Cost measurement in laparoscopic surgery: results from an activity-based costing application

Activity Based Costing (ABC) techniques are designed to support advanced cost analysis in different organizations. Centred on organization activities and processes, it provides more accurate cost information on cost objects using appropriate cost drivers and constitutes a powerful costing model to improve efficiency and effectiveness in delivering products and services. ABC can be successfully applied also in Health Care organizations, where the patient is the main “object” of the activities performed. In addition, in can be fruitfully used in costing the resource consumption of new medical technology devices or surgery processes to assess their economic impact on health care costs. The purpose of this paper is to describe an Activity based costing model designed to measure and control resources consumption and cost when a new technology is applied in health care processes. An ABC model has been defined in relation to laparoscopic technologies applied to surgical cases, designing a health care “activity hierarchy” based on the processes of a specific local unit organization. The output of the application has been a full cost of laparoscopic surgery to be compared with the correspondent DRG current value. As a further result, the paper shows how the ABC model is able to generate different cost figures referred to activity levels or aggregations able to support decision making especially when the introduction of a new surgical technology has to be economically assessed. Propositions are finally made to generate discussion about the effectiveness of the existing cost accounting systems in the health care organizations and on the need for the wider diffusion of ABC techniques in this service sector.Activity-Based Costing, Economic assessment of surgery techniques

Cost Measurement in Laparoscopic Surgery: Results from an Activity-Based Costing Application

Activity Based Costing (ABC) techniques are designed to support advanced cost analysis in different organizations. Centred on organization activities and processes, it provides more accurate cost information on cost objects using appropriate cost drivers and constitutes a powerful costing model to improve efficiency and effectiveness in delivering products and services. ABC can be successfully appl ied also in Health Care organizations, where the patient is the main “object” of the activities performed. In addition, in can be fruitfully used in costing the resource consumption of new medical technology devices or surgery processes to assess their eco nomic impact on health care costs. The purpose of this paper is to describe an Activity based costing model designed to measure and control resources consumption and cost when a new technology is applied in health care processes. An ABC model has been defined in relation to laparoscopic technologies applied to surgical cases, designing a health care “activity hierarchy” based on the processes of a specific local unit organization. The output of the application has been a full cost of laparoscopic surgery to be compared with the correspondent DRG current value. As a further result, the paper shows how the ABC model is able to generate different cost figures referred to activity levels or aggregations able to support decision making especially when the introdu ction of a new surgical technology has to be economically assessed. Propositions are finally made to generate discussion about the effectiveness of the existing cost accounting systems in the health care organizations and on the need for the wider diffusio n of ABC techniques in this service sector.Activity-Based Costing; Economic assessment of surgery techniques

Cost Measurement in Laparoscopic Surgery: Results from an Activity-Based Costing Application

Activity Based Costing (ABC) techniques are designed to support advanced cost analysis in different organizations. Centred on organization activities and processes, it provides more accurate cost information on cost objects using appropriate cost drivers and constitutes a powerful costing model to improve efficiency and effectiveness in delivering products and services. ABC can be successfully appl ied also in Health Care organizations, where the patient is the main “object” of the activities performed. In addition, in can be fruitfully used in costing the resource consumption of new medical technology devices or surgery processes to assess their eco nomic impact on health care costs. The purpose of this paper is to describe an Activity based costing model designed to measure and control resources consumption and cost when a new technology is applied in health care processes. An ABC model has been defined in relation to laparoscopic technologies applied to surgical cases, designing a health care “activity hierarchy” based on the processes of a specific local unit organization. The output of the application has been a full cost of laparoscopic surgery to be compared with the correspondent DRG current value. As a further result, the paper shows how the ABC model is able to generate different cost figures referred to activity levels or aggregations able to support decision making especially when the introdu ction of a new surgical technology has to be economically assessed. Propositions are finally made to generate discussion about the effectiveness of the existing cost accounting systems in the health care organizations and on the need for the wider diffusio n of ABC techniques in this service sector

Process view and cost management of a new surgery technique in hospital

Purpose – The purpose of this paper is to analyze the potentiality in the application of process analysis and activity-based costing (ABC) in a healthcare setting to produce usable, useful and correct information on resource consumption and processes. The paper aims to analyze changes applied to the traditional costing model in order to represent the work flow of the organization and the related additional information usable by decision makers at different levels. In particular, the paper is focused on economic analysis related to the introduction of a new surgical technique in healthcare. Design/methodology/approach – An empirical case study is developed in a Tuscan hospital from September 2005 to March 2006, data being collected through interviews to employees and direct observations. Findings – Several factors are found to be critical in such a process analysis and in an ABC implementation in healthcare. First, the need to ground the development of the model structure on the specific characteristics of the organizational setting and the clinical work performed. Second, a problem of culture and language, because professionals have difficulties in understanding the language of activities, and they cannot accept a model designed to measure their work; therefore, some resistances may occur. Third, the constraint of information; in fact more precise estimation may be limited by the information available, as in this case. Research limitations/implications – The paper provides a framework for future research. The replication of the methodology in other hospitals, in order to test the validity of the model and to compare results, can be interesting and another can be the analysis of benefits that the application of the system can provide (in terms of improved efficiency) through a longitudinal analysis. Originality/value – The paper contributes to the field study of ABC and process analysis in healthcare. The original contribution of the model lies in the classification of activities in a hierarchy across the organization, which allows a more precise identification of cost driver; and in the “hybrid” nature (a combination of cost centres and activities) of the model. The latter allows one to identify a “full cost” of the patient. Keywords - Cost drivers, Health services, Activity based costs, Surgery Paper type - Case stud

A prospective non-randomized controlled, multicenter trial comparing Appendectomy and Conservative Treatment for Patients with Uncomplicated Acute Appendicitis (the ACTUAA study)

Purpose: Acute appendicitis (AA) is among the most common causes of lower abdominal pain and admissions to the emergency department. Over the past 20 years, there has been a renewed interest in the conservative management of uncomplicated AA, and several studies demonstrated that an antibiotic-first strategy is a viable treatment option for uncomplicated AA. The aim of this prospective non-randomized controlled, multicenter trial is to compare antibiotic therapy and emergency appendectomy as treatment for patients with uncomplicated AA confirmed by US and/or CT or MRI scan. Methods: All adult patients in the age range 18 to 65 years with suspected AA, consecutively admitted to the Surgical Department of the 13 participating Italian Hospitals, will be invited to take part in the study. A multicenter prospective collected registry developed by surgeons, radiologists, and pathologists with expertise in the diagnosis and treatment of uncomplicated acute appendicitis represents the best research method to assess the long-term role of antibiotics in the management of the disease. Comparison will be made between surgical and antibiotic-first approaches to uncomplicated AA through the analysis of the primary outcome measure of complication-free treatment success rate based on 1-year follow-up. Quality of life, length of hospital stay, pain evaluation, and time to return to normal activity will be evaluated as secondary outcome measures. Trial registration: Clinicaltrials.gov ID: NCT03080103