The effect of utilization on health care costs

This report analyzes the effect of utilization on health care costs. Two important aspects of utilization are examined: (1) the type of obstetric delivery utilized; (2) the extent of utilization of hospital facilities. A retrospective review of the type of delivery employed by five different physicians to deliver 494 primiparous patients revealed cesarean section rates varying from 16% to 40%. Average charges incurred by 100 patients who had undergone uncomplicated abdominal hysterectomies varied by as much as 26%. A simple formula to project cost is included.