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Costs of occupational injuries in agriculture.

OBJECTIVE: This study was conducted to estimate the costs of job-related injuries in agriculture in the United States for 1992. METHODS: The authors reviewed data from national surveys to assess the incidence of fatal and non-fatal farm injuries. Numerical adjustments were made for weaknesses in the most reliable data sets. For example, the Bureau of Labor Statistics (BLS) Annual Survey estimate of non-fatal injuries is adjusted upward by a factor of 4.7 to reflect the BLS undercount of farm injuries. To assess costs, the authors used the human capital method that allocates costs to direct categories such as medical expenses, as well as indirect categories such as lost earnings, lost home production, and lost fringe benefits. Cost data were drawn from the Health Care Financing Administration and the National Council on Compensation Insurance. RESULTS: Eight hundred forty-one (841) deaths and 512,539 non-fatal injuries are estimated for 1992. The non-fatal injuries include 281,896 that led to at least one full day of work loss. Agricultural occupational injuries cost an estimated $4.57 billion (range $3.14 billion to $13.99 billion) in 1992. On a per person basis, farming contributes roughly 30% more than the national average to occupational injury costs. Direct costs are estimated to be $1.66 billion and indirect costs, $2.93 billion. CONCLUSIONS: The costs of farm injuries are on a par with the costs of hepatitis C. This high cost is in sharp contrast to the limited public attention and economic resources devoted to prevention and amelioration of farm injuries. Agricultural occupational injuries are an underappreciated contributor to the overall national burden of health and medical costs.

Accidents, Occupational↗

Getting the cost right in cost-effectiveness analyses.

OBJECTIVE: The authors examined different ways of measuring unit costs and how methodological assumptions can affect the magnitude of cost estimates and the ratio of treatment costs in comparative studies of mental health interventions. Four methodological choices may bias cost estimates: study perspective, definition of the opportunity cost of resources, cost allocation rules, and measurement of service units. METHOD: Unit costs for outpatient services, individual therapy, and group therapy were calculated under different assumptions for a single community mental health center (CMHC). Using hypothetical service utilization profiles, the authors used the unit costs to calculate the costs of mental health treatments provided by two programs of the CMHC. RESULTS: The unit costs for an hour of outpatient services ranged from $108 to $538. The unit costs for an hour of therapy varied by 156%; unit costs were lowest if the management perspective was assumed and highest if the economist perspective was assumed. The ratio of the outpatient costs in the two treatment programs ranged from 0.6 to 1.8. CONCLUSIONS: The potential errors introduced by methodological choices can bias cost-effectiveness findings based on randomized control trials. These errors go undetected because crucial methodological information is not reported.

Ambulatory Care↗

Ecological costs of induced resistance.

There has been rapid progress in detecting the genetic or allocation costs of induced resistance. In addition to these 'internal' costs, ecological costs may result from external mechanisms, that is, from the detrimental effects of resistance on the plant's interactions with its environment. All evolutionarily relevant costs affect a plant's ability to perform under natural conditions. The conceptual separation of different forms of resistance costs simplifies the study of mechanisms by which these costs arise. Yet, integrative measures of fitness must be applied under natural conditions so that researchers can fully understand the costs and benefits of induced resistance.

Animals↗

Assessing the cost of a cardiology residency program with a cost construction model.

BACKGROUND: Although the total costs of graduate medical education are difficult to quantify, this information is of great importance in planning over the next decade. METHODS AND RESULTS: A cost construction model was used to quantify the costs of teaching faculty, cardiology fellows' salaries and benefits, overhead (physical plant, equipment, and support staff), and other costs associated with the cardiology residency program at the University of Texas-Houston during the 1996 to 1997 academic year. Surveys of cardiology faculty and fellows, checked by the program director, were conducted to determine the time spent in teaching activities; access to institutional and departmental financial records was obtained to quantify associated costs. The model was then developed and examined for a range of assumptions concerning cardiology fellows' productivity, replacement costs, and the cost allocation of activities jointly producing clinical care and education. The instructional cost of training (cost of didactic, direct clinical supervision, preparation for teaching, and teaching-related administration, plus the support of the teaching program) was estimated at $73,939 per cardiology fellow per year. This cost was less than the estimated replacement value of the teaching and clinical services provided by cardiology fellows, $100,937 per cardiology fellow per year. Sensitivity analysis, with different assumptions on cardiology fellows' productivity and replacement costs, varied the cost estimates but generally represented the cardiology residency program as an asset. CONCLUSIONS: Cost construction models can be used as a tool to estimate variations in resource requirements resulting from changes in curriculum or educators' costs. In this residency, the value of the teaching and clinical services provided by cardiology fellows exceeded the cost of the resources used in the educational program.

Cardiology↗

A cost-construction model to assess the total cost of an anesthesiology residency program.

BACKGROUND: Although the total costs of graduate medical education are difficult to quantify, this information may be of great importance for health policy and planning over the next decade. This study describes the total costs associated with the residency program at the University of Texas--Houston Department of Anesthesiology during the 1996-1997 academic year. METHODS: The authors used cost-construction methodology, which computes the cost of teaching from information on program description, resident enrollment, faculty and resident salaries and benefits, and overhead. Surveys of faculty and residents were conducted to determine the time spent in teaching activities; access to institutional and departmental financial records was obtained to quantify associated costs. The model was then developed and examined for a range of assumptions concerning resident productivity, replacement costs, and the cost allocation of activities jointly producing clinical care and education. RESULTS: The cost of resident training (cost of didactic teaching, direct clinical supervision, teaching-related preparation and administration, plus the support of the teaching program) was estimated at $75,070 per resident per year. This cost was less than the estimated replacement value of the teaching and clinical services provided by residents, $103,436 per resident per year. Sensitivity analysis, with different assumptions regarding resident replacement cost and reimbursement rates, varied the cost estimates but generally identified the anesthesiology residency program as a financial asset. CONCLUSIONS: In most scenarios, the value of the teaching and clinical services provided by residents exceeded the cost of the resources used in the educational program.

Anesthesiology↗

Micro-costing analysis: a measure of accountability.

A description of a micro-costing analysis conducted by the Psychiatric Occupational Therapy Department at Rush-Presbyterian St. Luke's Medical Center is reported. Analysis enabled a department manager to establish cost estimates for the services provided by the department. Included are data reflective of both costs and overhead. The analysis generates information concerning the relative amount of labor used, projected annual volumes, costs for direct and indirect labor, overtime, direct and indirect supplies, allocated cost, and cost for each identified evaluation and/or treatment. Access to cost information enables the department manager to realistically establish charges and to assess efficient use of personnel and supplies. The micro-costing analysis provides a vehicle to communicate departmental needs to the hospital administration based upon documented use of resources, and justified by a thorough cost breakdown.

Computers↗

Cost of coronary artery bypass surgery: a pilot study.

The increasing concern about the high cost of health care led the authors to conduct a pilot study on the overall cost and cost variability for patients who underwent coronary artery bypass grafting. They reviewed the charts of 50 randomly selected patients to determine actual costs of catheterization and bypass grafting. Four patients had single-vessel disease, 12 double- and 34 triple-vessel disease and 13 had moderate to severe impairment of ventricular function. The length of hospital stay ranged from 8 to 43 days (mean 16.5 days). The duration of stay in the recovery room and intensive care unit ranged from 21 to 356 hours (mean 91.6 hours). Operative time ranged from 2 to 6.5 hours (mean 3.95 hours). Using several accepted cost-allocation methods, the authors developed a valid, complete breakdown of clinical and nonclinical costs. Total cost was directly related to the length of hospital stay, left ventricular function, secondary diagnosis and number of diseased vessels. Further studies will address clinical factors related to cost and cost effectiveness of coronary artery bypass grafting as opposed to other forms of treatment for coronary artery disease.

Adult↗

Principles of cost-effective resource allocation in health care organizations.

Cost-effectiveness analysis (CEA) is a method of economic evaluation that can be used to assess the efficiency with which health care technologies use limited resources to produce health outputs. However, inconsistencies in the way that such ratios are constructed often lead to misleading conclusions when CEAs are compared. Some of these inconsistencies, such as failure to discount or to calculate incremental ratios correctly, reflect analytical errors that, if corrected, would resolve the inconsistencies. Others reflect fundamental differences in the viewpoint of the analysis. The perspectives of different decision-making entities can properly lead to different items in the numerator and denominator of the cost-effectiveness (C/E) ratio. Producers and consumers of CEA need to be more conscious of the perspectives of analysis, so that C/E comparisons from a given perspective are based upon a common understanding of the elements that are properly included.

Cost-Benefit Analysis↗

Lifetime costs for medical services: a methodological review.

OBJECTIVES: Guidelines for economic evaluation studies recommend that modeling be undertaken to estimate long-term, downstream costs. In this study, we conduct a review of a sample of studies that estimated the lifetime medical care costs for a variety of conditions. METHODS: We developed a categorization of the elements for a lifetime-costing study and based on these elements, we abstracted information from a sample of 33 papers in the following areas: study subject, purpose, scope, methods (including time profile, utilization, and cost), and results. RESULTS: We analyzed papers that were observational, models or that combined the two approaches. The time profiles were estimated from registry and published data. Utilization data were obtained from administrative data, chart reviews, and professional opinion. Costs were obtained from administrative and financial records and were estimated using all charges, allocated costs, and provider payments. We noted wide variations in methods and reporting practices. CONCLUSIONS: Following current guidelines (CCOHTA), lifetime models can be more easily interpreted and applied if investigators are more clear in their study aims, if they incorporate assumptions that are based on current data, if they follow current methodological practices (such as deflation, discounting, and sensitivity analyses), and if reporting is more transparent.

Canada↗

Charging for intensive care using direct nursing hours as the cost marker.

The hypothesis that direct nursing hours correlate with the cost of a patient stay in intensive care was tested. One hundred and thirty-nine patients were studied and the data collected included: (a) direct nursing hours applied to each patient; (b) a daily TISS score: (c) a detailed costing of each patient (all costs are shown in N.Z.$). There was a strong correlation between the direct nursing hours and the total cost per patient (r2 = 0.98) (total cost = 54 x direct nursing hours + 344). Also a strong correlation existed between the total TISS scores and the total costs per patient (r2 = 0.96) (total cost = 67.13 x TISS). Direct nursing hours offer a relatively simple and logical method of allocating costs per patient.

Direct Service Costs↗

A cost-effectiveness analysis of aspirin versus oral anticoagulants after acute myocardial infarction in Italy -- equivalence of costs as a possible case for oral anticoagulants.

AIMS: The recent publication of two large trials of secondary prevention of coronary artery disease with oral anticoagulants (WARIS and ASPECT) has caused a revival of the interest for this antithrombotic therapy in a clinical setting where the use of aspirin is common medical practice. Despite this, the preferential use of aspirin has been supported by an American cost-effectiveness analysis (JAMA 1995; 273: 965). METHODS AND RESULTS: Using the same parameters used in that analysis and incidence of events from the Antiplatelet Trialists Collaboration and the ASPECT study, we re-evaluated the economic odds in favor of aspirin or oral anticoagulants in the Italian Health System, which differs significantly in cost allocation from the United States system and is, conversely, similar to other European settings. Recalculated costs associated with each therapy were 2,150 ECU/ patient/year for oral anticoagulants and 2,187 ECU/patient/year for aspirin. In our analysis, the higher costs of oral anticoagulants versus aspirin due to a moderate excess of bleeding (about 10 ECU/ patient/year) and the monitoring of therapy (168 ECU/ patient/year) are more than offset by an alleged savings for recurrent ischemic syndromes and interventional procedures (249 ECU/ patient/year). CONCLUSIONS: Preference of aspirin vs. oral anticoagulants in a pharmaco-economical perspective is highly dependent on the geographical situation whereupon calculations are based. On a pure cost-effectiveness basis, and in the absence of data of direct comparisons between aspirin alone versus I.N.R.-adjusted oral anticoagulants, the latter are not more expensive than aspirin in Italy and, by cost comparisons, in other European countries in the setting of post-myocardial infarction.

Administration, Oral↗

Potential cost effectiveness of intravenous tissue plasminogen activator versus streptokinase for acute myocardial infarction.

OBJECTIVE: An economic evaluation of the potential incremental benefits of intravenous tissue plasminogen activator (tPA) versus streptokinase (SK) for treatment of acute myocardial infarction. DESIGN: Cost effectiveness analysis from a third-party payer perspective (Ontario Ministry of Health). ECONOMIC INPUTS: Fully allocated costs for cardiovascular procedures and hospitalization for myocardial infarction were obtained anonymously for four Ontario teaching hospitals and converted to 1988 Canadian dollars. Professional charges were taken from the provincial health insurance fee schedule and drug costs obtained from the manufacturers. CLINICAL INPUTS: The baseline analysis was for nonelderly patients with uncomplicated myocardial infarctions; sensitivity analyses allowed extrapolation to higher risk subgroups. Short and longer term mortality and short term invasive procedure rates were estimated using data from clinical trials. MAIN RESULTS: If tPA achieves a 1% short term mortality advantage over SK with no advantages for other survivors, cost per life-year gained can be comparable to other cardiovascular interventions at $58,600. In the absence of immediate survival advantages, but assuming greater left ventricular preservation, the constant annual hazard rate advantage must be about 0.5% per year for competitive cost effectiveness ratios. CONCLUSIONS: A full range of projections is presented to help guide the policy decisions that will arise in the wake of the Global Utilization of SK and tPA for Occluded Coronary Arteries (GUSTO) trial. The analysis also illustrates the general importance of considering longer term effects of in-hospital therapies for acute myocardial infarction.

Cost-Benefit Analysis↗

Resource allocation and the cost of quality.

The costs of producing quality medical care and the proper allocation of resources to assure quality are major contemporary concerns. Minimalists attempt to improve quality and lower costs through the application of the theory, "less is more." Bureaucracies make the same attempt through the denial of payments for "unnecessary" services. Governments and insurers try to "improve quality" by impeding the flow of new technology so that costs will be restricted (presumably allowing society better access to current care modalities). All impose regulations and requirements on medical practice. Each of these approaches is examined individually and substantial problems with their application in actual practice are illustrated. Genuine quality is not a cost or resource allocation problem. Quality is free.

Costs and Cost Analysis↗

Changing the admission process for elective surgery: an economic analysis.

This study compared the costs of an inpatient elective surgical admission process with an outpatient based same day admission programme in patients undergoing laparoscopic cholecystectomy. The effect of this process change on annual surgical volume and case flow (number of procedures performed per surgical bed) in the year before the initiation of same-day method (1989/90) and subsequent to the widespread use of the process (1992/93), was also assessed. Costs incurred by 53 patients who underwent preoperative anaesthetic and surgical assessment as outpatients and were admitted as an outpatient on the day of surgery (SD Group) were compared with those incurred by 11 patients who entered hospital on the day before surgery and underwent anaesthetic and other assessments as inpatients (IP Group). Nursing, radiology, laboratory, operating room, rehabilitation and clinic costs were obtained for each patient. The remaining costs were not amenable to individual attribution and were assigned to each group as a percentage of the allocated costs. The cost per case in the SD Group was $360 less than in the IP Group, reflecting decreased nursing costs incurred by the SD Group. Between the period 1989/90 and 1992/93, the number of surgical beds declined 15.7%; however, surgical volume decreased by only 5.4%. Total case flow improved by 12.2%, that for elective and non-elective surgery increasing by 14.1% and 9.5%, respectively. Elective surgery, where same day admission was used, showed the greatest improvement in case flow. We conclude that a same day admission process reduces cost and serves to enhance hospital productivity.

Adult↗

Determination of VA health care costs.

In the absence of billing data, alternative methods are used to estimate the cost of hospital stays, outpatient visits, and treatment innovations in the U.S. Department of Veterans Affairs (VA). The choice of method represents a trade-off between accuracy and research cost. The direct measurement method gathers information on staff activities, supplies, equipment, space, and workload. Since it is expensive, direct measurement should be reserved for finding short-run costs, evaluating provider efficiency, or determining the cost of treatments that are innovative or unique to VA. The pseudo-bill method combines utilization data with a non-VA reimbursement schedule. The cost regression method estimates the cost of VA hospital stays by applying the relationship between cost and characteristics of non-VA hospitalizations. The Health Economics Resource Center uses pseudo-bill and cost regression methods to create an encounter-level database of VA costs. Researchers are also beginning to use the VA activity-based cost allocation system.

Accounting↗

Building bridges with clinicians.

Clinical and ancillary staff need and welcome the opportunity to be involved in healthcare financial management. To provide them with the financial tools they need, a group of clinical and nonclinical professionals identified the key components of a curriculum that addressed financial, managerial, and cost accounting, along with training objectives that include understanding cost allocation, trend analysis, and variance analysis.

Allied Health Personnel↗

Analysis of hospital cost in total knee arthroplasty. Does length of stay matter?

In this study, actual hospital total joint expenditures were analyzed, and the effect of decreased length of stay on these actual costs was determined. Expenditures were stratified per hospital and accounting conventions into fixed and variable costs. Hospital costs associated with 15 index knee arthroplasty procedures from fiscal years 1992, 1993, and 1994 were analyzed. Expenditures were standardized to inflation-controlled 1994 dollars. Average length of stay for knee arthroplasty procedures decreased 30% during this period (range, 8.7-6.1 days). Also, expenditures for total knee arthroplasty decreased only 13% (range, $17,415-$15,200) in inflation-controlled 1994 dollars. Using inflation-controlled dollars, analysis of variable costs revealed a continued rise of $278 during this period. Therefore, essentially all the cost reductions achieved were in the fixed component of cost allocated to each patient. Length of stay reductions, although beneficial, did not reduce hospital variable expenses significantly. Expenditure reductions were most exclusively in fixed costs. However, the overall total fixed hospital costs were largely unchanged. Thus, it is necessary to decrease variable costs (implant and supply costs) to significantly reduce hospital expenditures.

Aged↗