Relationship of hospital size, case volume, and cost for coronary artery bypass surgery: Analysis of 12,774 patients operated on in Massachusetts during.

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Presentation transcript:

Relationship of hospital size, case volume, and cost for coronary artery bypass surgery: Analysis of 12,774 patients operated on in Massachusetts during fiscal years 1995 and 1996 David M. Shahian, MD, Gerald J. Heatley, MS, George A. Westcott, MSHPM The Journal of Thoracic and Cardiovascular Surgery Volume 122, Issue 1, Pages 53-64 (July 2001) DOI: 10.1067/mtc.2001.113750 Copyright © 2001 American Association for Thoracic Surgery Terms and Conditions

Fig. 1 Scatterplots of average direct cost versus case volume for each hospital by DRG and year. The Journal of Thoracic and Cardiovascular Surgery 2001 122, 53-64DOI: (10.1067/mtc.2001.113750) Copyright © 2001 American Association for Thoracic Surgery Terms and Conditions

Fig. 2 A, The percent change in case volume for each hospital between fiscal years 1995 and 1996 (DRG 106) is depicted in black bars along with the corresponding percent change in direct costs, depicted in gray hatched bars. There is no linear correlation between the changes observed for the two variables across the spectrum of 12 hospitals (r = 0.005). Both the magnitude and the direction of the relationship varied. In some instances, both variables increase; in others, both decrease. Only at 6 hospitals were the changes in the two variables inversely related. B, Similar data are plotted for DRG 107. Again, there is no linear relationship (r = 0.267), and for only 5 hospitals was the change in the two variables inversely related. The Journal of Thoracic and Cardiovascular Surgery 2001 122, 53-64DOI: (10.1067/mtc.2001.113750) Copyright © 2001 American Association for Thoracic Surgery Terms and Conditions

Fig. 3 A typical average cost curve. Average cost falls as volume increases and as fixed costs are distributed over a larger number of procedures. This reaches a plateau, which may encompass a broad range of volume, over which average and marginal costs are equal, and volume does not significantly affect average cost. In the short term, significant volume expansion may excxeed hospital resource capacity, and the resulting opportunity or bottleneck costs may increase average CABG cost. The Journal of Thoracic and Cardiovascular Surgery 2001 122, 53-64DOI: (10.1067/mtc.2001.113750) Copyright © 2001 American Association for Thoracic Surgery Terms and Conditions

Fig. 4 The hypothetical average cost curves for two hospitals (H1 and H2). Comparing two hospitals, the more efficient H2 will achieve a given level of cost (C1) at a significantly lower volume of cases (V1) than that required (V2) to achieve the same cost level at hospital H1. Conversely, at the same level of volume (V2), hospital H2 will have significantly lower costs (C2) than hospital H1 (C1). The Journal of Thoracic and Cardiovascular Surgery 2001 122, 53-64DOI: (10.1067/mtc.2001.113750) Copyright © 2001 American Association for Thoracic Surgery Terms and Conditions