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Cost of outpatient endoscopic sinus surgery from the perspective of the Canadian government: a time-driven activity-based costing approach

Authors

  • Jennifer Au MD, MSc,

    1. Division of Otolaryngology–Head and Neck Surgery, Department of Surgery, University of Calgary, Calgary, Alberta, Canada
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  • Luke Rudmik MD, FRCSC

    Corresponding author
    1. Division of Otolaryngology–Head and Neck Surgery, Department of Surgery, University of Calgary, Calgary, Alberta, Canada
    • Correspondence to: Luke Rudmik, MD, FRCSC, Division of Otolaryngology–Head and Neck Surgery, Department of Surgery, University of Calgary, Foothills Medical Centre, South Tower Suite 602, 1403 - 29th St. NW T2N 2T9, Calgary, Alberta, Canada; e-mail: Lukerudmik@gmail.com

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  • Potential conflict of interest: None provided.

Abstract

Background

The time-driven activity-based costing (TD-ABC) method is a novel approach to quantify the costs of a complex system. The aim of this study was to apply the TD-ABC technique to define the overall cost of a routine outpatient endoscopic sinus surgery (ESS) from the perspective of the Canadian government payer.

Methods

Costing perspective was the Canadian government payer. All monetary values are in Canadian dollars as of December 2012. Costs were obtained by contacting staff unions, reviewing purchasing databases and provincial physician fee schedules. Practical capacity time values were collected from the College and Association of Registered Nurses of Alberta. Capacity cost rates ($/min) were calculated for all staff, capital equipment, and hospital space.

Results

The overall cost for routine outpatient ESS was $3510.31. The cost per ESS case for each clinical pathway encounter was as follows: preoperative holding ($49.19); intraoperative ($3296.60); sterilization ($90.20); postanesthesia care unit ($28.64); and postoperative day ward ($45.68). The 3 major cost drivers were physician fees, disposable equipment, and nursing costs. The intraoperative phase contributed to 94.5% of the overall cost.

Conclusion

This study applied the TD-ABC method to evaluate the cost of outpatient ESS from the perspective of the Canadian government payer and defined the overall cost to be $3510.31 per case.

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