Time-driven Activity-based Costing of Multivessel Coronary Artery Bypass Grafting across National Boundaries to Identify Improvement Opportunities: Study Protocol

F.  Erhun; B.  Mistry; T.  Platcheck; A.  Milstein; V.G.   Narayanan; R. S. Kaplan

Article | BMJ Open

Time-driven Activity-based Costing of Multivessel Coronary Artery Bypass Grafting across National Boundaries to Identify Improvement Opportunities: Study Protocol

by F. Erhun, B. Mistry, T. Platcheck, A. Milstein, V.G. Narayanan and R. S. Kaplan

Abstract

Coronary artery bypass graft (CABG) surgery is a common treatment for coronary artery disease—a disease that affects over 10% of US adults and is a major cause of morbidity and mortality. In 2005, the mean cost for a CABG procedure among Medicare beneficiaries in the USA was $32,000. The same operation reportedly costs less than $2000 to produce in India. The proposed study will (1) identify the difference in the costs incurred to perform CABG surgery at three Joint Commission accredited hospitals, two in U.S. and one in India, and (2) characterize the opportunity to reduce the cost of performing CABG surgery. We use time-driven activity-based costing (TDABC) to quantify the hospitals' costs of producing elective, multivessel CABG. TDABC estimates the costs of a given clinical service by combining information about the process of patient care delivery (specifically, the time and quantity of labor and non-labor resources utilized to perform each activity) with the unit cost of each resource used to provide the care. We will conduct a variance analysis of labor costs to separate out price and quantity effects across the three hospitals to reveal opportunities to bend the cost curve for CABG production in the USA.

Keywords: Activity Based Costing and Management; Health Disorders; Health Care and Treatment; United States; India;

Format: Electronic

Read Now

Citation:

Erhun, F., B. Mistry, T. Platcheck, A. Milstein, V.G. Narayanan, and R. S. Kaplan. "Time-driven Activity-based Costing of Multivessel Coronary Artery Bypass Grafting across National Boundaries to Identify Improvement Opportunities: Study Protocol." BMJ Open 5, no. 8 (2015).

Leaders at six hospitals conducted a research study to assess and compare the health outcomes and costs of pediatric aerodigestive care. Four of the hospitals delivered care with an integrated practice unit (IPU) while two delivered care traditionally, with isolated specialists. The study used time-driven activity-based costing as a tool to measure and compare costs across the six sites. The results demonstrate that the four IPU sites improved clinical outcomes and had lower costs of care.

Value-based care models are becoming instrumental in structuring clinical care delivery in our healthcare climate. Our objective was to determine the value associated with implementation of a Family-Centered Care Coordination (FCCC) program for neonates undergoing tracheostomy.

Article | American Heart Journal

Are Cost Advantages from a Modern Indian Hospital Transferable to the United States?

R. S. Kaplan, F. Erhun, V.G. Narayanan, B. Mistry, K. Brayton, et al, R. S. Kaplan, F. Erhun, V.G. Narayanan, B. Mistry and K. Brayton, et al

We use time-driven activity-based costing to estimate the cost of personnel and space for an elective coronary artery bypass graft (CABG) surgery at two U.S. hospitals, Intermountain and Baylor Heart, and Narayana Health (NH), in India. All three hospitals use modern management methods to achieve excellent patient outcomes. We use variance analysis to remove the effect of differential prices paid for personnel and space at the three hospitals. NH, even at U.S. price levels, retains a cost advantage over the two U.S. hospitals by shifting tasks to less-credentialed and/or less-experienced personnel, supervised by highly-skilled personnel, a practice facilitated by NH’s high annual CABG volume. NH offsets some of its task downshifting cost savings by having lower-skilled employees spend more time counseling patients and their families for in-hospital and home recovery. NH’s cost-saving practices could be captured by U.S. hospitals by relaxing hospital and health professional licensing regulations, encouraging greater family participation in inpatient care, and performing complex surgeries in high-volume regional centers of excellence.

Keywords: Time-Driven Activity-Based Costing; Health Care and Treatment; Cost; Organizational Structure; Performance Efficiency; India; United States;

Citation:

Kaplan, R. S., F. Erhun, V.G. Narayanan, B. Mistry, and K. Brayton, et al. "Are Cost Advantages from a Modern Indian Hospital Transferable to the United States?" American Heart Journal 224 (June 2020): 148–155. View Details

Cite View Details Read Now Read Now

Faculty & Research

Time-driven Activity-based Costing of Multivessel Coronary Artery Bypass Grafting across National Boundaries to Identify Improvement Opportunities: Study Protocol

Abstract

Citation:

About the Authors

More from these Authors