Purpose
The purpose of this study was to determine the cost of the episode of care for primary
rotator cuff repair (RCR) from day of surgery to 90 days postoperatively using the
time-driven activity-based costing (TDABC) method. The secondary purpose of this study
was to identify the main drivers of cost for both phases of care.
Methods
This retrospective case series study used the TDABC method to determine the bundled
cost of care for an RCR. First, a process map of the RCR episode of care was constructed
in order to determine drivers of fixed (i.e., rent, power), direct variable (i.e., healthcare
personnel), and indirect costs (i.e., marketing, building maintenance). The study
was performed at a Midwestern tertiary care medical system, and patients were included
in the study if they underwent an RCR from January 2018 to January 2019 with at least
90 days of postoperative follow-up. In this article, all costs were included, but
we did not account for fees to provider and professional groups.
Results
The TDABC method calculated a cost of $10,569 for a bundled RCR, with 76% arising
from the operative phase and 24% from the postoperative phase. The main driver of
cost within the operative phase was the direct fixed costs, which accounted for 35%
of the cost in this phase, and the largest contributor to cost within this category
was the cost of implants, which accounted for 55%. In the postoperative phase of care,
physical therapy visits were the greatest contributor to cost at 59%.
Conclusion
In a bundled cost of care for RCR, the largest cost driver occurs on the day of surgery
for direct fixed costs, in particular, the implant. Physical therapy represents over
half of the costs of the episode of care. Better understanding the specific cost of
care for RCR will facilitate optimization with appropriately designed payment models
and policies that safeguard the interests of the patient, physician, and payer.
Level of Evidence
IV, therapeutic case series.
Key Words
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Article Info
Publication History
Published online: February 18, 2022
Accepted:
February 6,
2022
Received:
October 9,
2021
Footnotes
See commentary on page 2378
Full ICMJE author disclosure forms are available for this article online, as supplementary material.
Identification
Copyright
© 2022 Published by Elsevier on behalf of the Arthroscopy Association of North America
