Where are the costs in perioperative care? Analysis of hospital costs and charges for inpatient surgical care.

BACKGROUND: Many health-care institutions are emphasizing cost reduction programs as a primary tool for managing profitability. The goal of this study was to elucidate the proportion of anesthesia costs relative to perioperative costs as determined by charges and actual costs.
METHODS: Costs and charges for 715 inpatients undergoing either discectomy (n = 234), prostatectomy (n = 152), appendectomy (n = 122) or laparoscopic cholecystectomy (n = 207) were retrospectively analyzed at Stanford University Medical Center from September 1993 to September 1994. Total hospital costs were separated into 11 hospital departments. Cost-to-charge ratios were calculated for each surgical procedure and hospital department. Hospitalization costs were also divided into variable and fixed costs (costs that do and do not change with patient volume). Costs were further partitioned into direct and indirect costs (costs that can and cannot be linked directly to a patient).
RESULTS: Forty-nine (49%) percent of total hospital costs were variable costs. Fifty-seven (57%) percent were direct costs. The largest hospital cost category was the operating room (33%) followed by the patient ward (31%). Intraoperative anesthesia costs were 5.6% of the total hospital cost. The overall cost-to-charge ratio (0.42) was constant between operations. Cost-to-charge ratios varied threefold among hospital departments. Patient charges overestimated resource consumption in some hospital departments (anesthesia) and underestimated resource consumption in others (ward).
CONCLUSIONS: Anesthesia comprises 5.6% of perioperative costs. The influence of anesthesia practice patterns on "downstream" events that influence costs of hospitalization requires further study.