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Clinical process cost analysis

C A Marrin1, L C Johnson, V L Beggs

  • 1Dartmouth Medical School, Hanover, New Hampshire, USA.

The Annals of Thoracic Surgery
|October 6, 1997
PubMed
Summary
This summary is machine-generated.

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Clinical process cost analysis reveals that personnel time and operating room activities are major cost drivers in lung cancer treatment. Reengineering care processes is key to reducing healthcare expenses.

Area of Science:

  • Healthcare Management
  • Health Economics
  • Surgical Oncology

Background:

  • Reimbursement systems create pressure for cost reduction in healthcare.
  • Current cost knowledge and process understanding are limited.
  • A method to link care activities with actual costs is needed.

Purpose of the Study:

  • To introduce and apply clinical process cost analysis.
  • To determine the actual costs of lung cancer operative treatment.
  • To identify key cost drivers and inform cost-reduction strategies.

Main Methods:

  • Detailed flow diagrams of care activities were constructed.
  • Costs were calculated for each activity and linked to the process.
  • The method was applied to Diagnosis Related Group 75 for lung cancer surgery.

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Main Results:

  • Total costs ranged from $6,400 to $7,700.
  • Personnel time was the primary cost driver (55%).
  • Operating room expenses constituted 40% of total costs; costs decreased during hospitalization.

Conclusions:

  • Clinical process cost analysis offers detailed insights into care costs and processes.
  • This analysis can guide the reengineering of care processes for cost reduction.