Comparing clinical outcomes in high-volume and low-volume off-pump coronary bypass operation programs.

UNLABELLED: sites and then analyzed the patient and hospital characteristics that had an impact on clinical outcomes. RESULTS: The mortality rates for the high- and low-volume OPCAB facilities both averaged 2.9% (p = NS). Patients at the high-volume OPCAB facilities had significantly lower rates of major complications (shock/hemorrhage, neurologic, renal, and cardiac) than those at the low-volume OPCAB facilities. Of the seven minor complications, rates for six were lower in the high-volume OPCAB facilities, but none of the differences reached statistical significance. High-volume OPCAB sites were significantly more likely to discharge their patients directly home than were low-volume OPCAB sites (80% versus 66%; p = 0.001). CONCLUSIONS: The results suggested that surgical team experience and choice of approaches to performing CABG had an impact on patient outcomes.

Trends in outcome and costs of coronary intervention in the 1990s.

Our objective was to examine trends in outcome and cost of percutaneous coronary intervention (PCI) between 1990 and 1999. PCI has become the most common form of myocardial revascularization in recent years, rivaling the more established coronary artery bypass surgery. There has been increasing interest in improving outcome of PCI while also seeking to minimize cost. A total of 21,755 patients undergoing PCI were evaluated. Clinical data were gathered from the Emory Cardiovascular Database and financial data from the UB92 formulation of the hospital bill. Charges were reduced to cost using departmental cost-to-charge ratios. Costs were inflated to 1999 dollars using medical care inflation rates. Mortality varied without a significant trend from 0.63% to 0.44% (p = 0.64). The Q-wave myocardial infarction rate decreased from 0.68% to 0.40% (p = 0.0003). Emergent coronary surgery decreased from 3.50% to 1.25% (p <0.0001). Mean hospital inflation-adjusted cost decreased from $10,478 to $8,367 (p <0.0001). Length of stay after the procedure decreased from 2.8 to 1.8 days (p <0.0001). Outcome of PCI continues to improve, with a decrease in coronary surgery and Q-wave myocardial infarction but with no significant change in mortality. This was accomplished while also decreasing costs and length of stay. Whether these favorable trends will continue remains to be seen.

Hospital resource consumption in patients with diabetes and multivessel coronary disease undergoing revascularization.

OBJECTIVE: To identify factors responsible for the variation in real hospital costs and length of stay for patients with diabetes undergoing coronary angioplasty or coronary bypass surgery. STUDY DESIGN: Retrospective study of patients with diabetes and coronary artery disease treated at a single hospital. PATIENTS AND METHODS: The study population included 1809 patients with diabetes and multivessel (2-vessel or 3-vessel) coronary artery disease who underwent an initial coronary angioplasty or coronary bypass surgery between 1988 and 1996. After accounting for the extent and severity of the patient's coronary artery disease, a sequential model was used to assess if diabetic characteristics were independently associated with higher hospital resource utilization during revascularization. RESULTS: Multivariate regression results indicated that for patients with diabetes who underwent coronary angioplasty, a baseline creatinine level of > or = 2.0 mg/dL was associated with significantly higher hospital costs and longer length of stay. For patients with diabetes who underwent a coronary bypass surgery only, a baseline creatinine level of > or = 2.5 mg/dL was associated with higher hospital costs and longer hospital length of stay. CONCLUSIONS: After controlling for coronary risk factors, selected diabetes-specific characteristics are associated with higher hospital resource utilization. Risk adjustments in hospital reimbursement may be needed to assure that patients with diabetes who have cardiovascular disease have access to revascularization procedures.

Impact of patient characteristics, complications, and facility volume on the costs and time of cardiac catheterization and coronary angioplasty in 70 catheterization laboratories.

Although over 1 million procedures are performed in cardiac catheterization laboratories (CCLs) annually, little comparative data exist on costs or resource use in these settings. In this study, data from 70 CCLs were used to profile CCL times and total direct costs for 2 high-volume procedures: left heart catheterization (LHC) and percutaneous transluminal coronary angioplasty (PTCA) with or without stent placement. In total, 70,677 consecutive patient examinations for a 12-month period from January 1, 1998 to December 31, 1998 were analyzed. For LHC mean total direct costs averaged $306, whereas for PTCA catheterization laboratory costs averaged $3,172. The average total times for these procedures were 63 and 108 minutes, respectively. Seventy-two percent of the PTCA patients underwent coronary stenting with an associated incremental cost of $1,244. By multivariate linear regression, baseline patient characteristics such as age, gender, and clinical factors had little impact on total time and total costs. The major determinants of CCL time and cost were procedural factors (e.g., number and type of interventions) and in-lab complications, including profound hypotension, abrupt vessel closure, and emergency bypass surgery. Using facility procedure volume as a proxy for potential economies of scale, we found no relation between CCL volume and total direct CCL costs. There did appear to be a significant inverse relation between facility volume and total procedural time with CCLs that performed the highest volumes of LHC and PTCA procedures saving an average of 5 to 9 minutes per procedure. These findings may be useful in defining specific time and cost benchmarks for these commonly performed procedures and serve to underscore the critical role of reducing complications in both quality improvement and cost-saving efforts.

The role of cost effectiveness analysis in health care evaluation.

This paper provides an overview of the key elements of cost effectiveness analysis (CEA). CEA is a method for evaluating the relative costs and benefits of treatments and procedures. Typically, CEA compares a proposed intervention with (at least) one alternative intervention, yielding an incremental cost effectiveness ratio. This ratio reflects both the longevity and health status of the differing interventions and permits the researcher to more completely compare and evaluate the "payoff" of the interventions. This paper discusses different perspectives CEA studies might adopt, and reviews the major methods for measuring both outcomes and costs.

Economic aspects of transesophageal echocardiography and atrial fibrillation.

Cardiovascular disease is the leading cause of complications and death in the United States, affecting nearly 60 million Americans in 1998 and costing an estimated $274.2 billion. A major contributor to the costs of cardiovascular disease is atrial fibrillation (AF). AF is the most common sustained arrhythmia and affects > 2.2 million people and approximately 5% of all persons over the age of 60. Transesophageal echocardiography (TEE) with short-term anticoagulation has been proposed as a viable strategy to guide patients with AF. Here, we (1) review the current environmental context for a TEE-guided approach, (2) summarize the existing literature on the economic aspects of TEE, and (3) outline an economic framework for an economic analysis of TEE investigation or any major clinical therapy. We conclude that more powerful analytical tools are evolving to analyze the important economic, clinical, and social aspects of a patient's medical encounter.

A retrospective study of 6,671 patients comparing coronary stenting and balloon angioplasty.

OBJECTIVE: To determine whether coronary stenting, compared to percutaneous transluminal coronary angioplasty, reduces the incidence of five clinical endpoints during a six-month follow-up period. BACKGROUND: There is considerable debate concerning whether coronary stents improve clinical outcomes, especially given the rapid growth in the use of coronary stents and their economic impact. METHODS: Study population included a total of 6,671 consecutive patients at 32 hospitals in 16 different states who underwent single or multi-vessel revascularization during 1997. Patients were divided into one of two groups: those who only underwent standard balloon angioplasty (PTCA) for all treated vessels and those who received coronary stents (STENT) in all treated vessels. RESULTS: STENT patients were significantly less likely to have emergency coronary artery bypass surgery (CABG) (p = 0.001) or die during initial procedure (p = 0.034) but were more likely than PTCA patients to be treated for hematoma (p = 0.002) and bradycardia (p = 0.004). After accounting for difference in patient characteristics, risk factors, procedure complications, and number of devices utilized, the estimated odds-ratio indicates that coronary stenting, compared to PTCA, significantly (p < 0.05) reduced adverse outcomes for only one clinical event, myocardial infarction. CONCLUSIONS: Compared to balloon angioplasty patients, coronary stent patients have no statistically significant differences in regard to additional percutaneous coronary intervention or coronary artery bypass during a six-month follow-up period. Since direct cardiac catheterization lab costs associated with coronary stenting is nearly 2.5 times greater than standard balloon angioplasty, our results suggest the cost-effectiveness of coronary stenting, especially for "hard" clinical outcomes, needs to be established.

Applying the resource-based relative value scale to the Emory angioplasty versus surgery trial.

The resource-based relative value scale developed for use in the Medicare fee schedule can also be very useful in profiling and comparing physicians' cardiovascular utilization across different medical activities. This article applies relative value units (RVUs) to data from the Emory Angioplasty versus Surgery Trial. The Emory Angioplasty versus Surgery Trial was a randomized clinical trial to determine the efficacy of percutaneous transluminal coronary angioplasty (PTCA) versus coronary artery bypass surgery (CABG). All physician services in the clinical trial provided to 2 groups of patients--those undergoing CABG and those receiving PTCA-over the course of 4 years were assigned physician work RVUs (representing the intensity of physician work required) and total RVUs (representing both the intensity and practice costs). Physician charges were also compiled. These data were used to profile and compare physician services to the 2 groups of patients by type of service, distribution over time, and clinical department. Comparisons based on RVUs contrast sharply with differences based on charges. Mean physician charges, in 1996 dollars, were $27,158 for CABG patients and $21,491 for PTCA patients, a 26% difference (p <0.001). Physician work RVUs generated an 18.3% difference (p = <0.001). Using total RVUs, the difference between the 2 groups was 3.3% (p = 0.249). Resource-based relative value weights are a valuable tool for analyzing and comparing physicians' use of cardiovascular resource. The results suggest that conclusions about physician resource utilization based on physician charges should be carefully evaluated. When possible, physician work RVUs should be compiled and evaluated along with physician charges.

Preventable hospitalizations in primary care shortage areas. An analysis of vulnerable Medicare beneficiaries.

BACKGROUND: Health care outcomes among vulnerable elderly populations (defined in this study as Medicare beneficiaries who rated their overall general health as "fair" or "poor") are a growing concern. Recent studies suggest that potentially preventable hospitalizations may be useful for identifying poor ambulatory health care outcomes among vulnerable populations. OBJECTIVES: To determine if Medicare beneficiaries in fair or poor health are at increased risk of experiencing a preventable hospitalization if they reside in primary care health professional shortage areas. DESIGN: A survey of Medicare beneficiaries from the 1991 Medicare Current Beneficiary Survey. PATIENTS: Medicare beneficiaries living in the community. RESULTS: Medicare beneficiaries in fair or poor health were 1.82 times more likely to experience a preventable hospitalization if they resided in a primary care shortage area (95% confidence interval, 1.18-2.81). After controlling for educational level, income, and supplemental insurance, Medicare beneficiaries in fair or poor health were 1.70 times more likely to experience a preventable hospitalization if they resided in a primary care shortage area (95% confidence interval, 1.09-2.65). CONCLUSIONS: Medicare beneficiaries in fair or poor health are more likely to experience a potentially preventable hospitalization if they live in a county designated as a primary care shortage area. Provision of Medicare coverage alone may not be enough to prevent poor ambulatory health care outcomes such as preventable hospitalizations. Improving health care outcomes for vulnerable elderly patients may require structural changes to the primary care ambulatory delivery system in the United States, especially in designated shortage areas.

Economics, health-related quality of life, and cost-effectiveness methods for the TACTICS (Treat Angina With Aggrastat [tirofiban]] and Determine Cost of Therapy with Invasive or Conservative Strategy)-TIMI 18 trial.

Concern over escalating health care costs has led to increasing focus on economics and assessment of outcome measures for expensive forms of therapy. This is being investigated in the Treat Angina With Aggrastat [tirofiban] and Determine Cost of Therapy with Invasive or Conservative Strategy (TACTICS)-TIMI 18 trial, a randomized trial comparing outcome of patients with unstable angina or non-Q-wave myocardial infarction treated with tirofiban and then randomized to an invasive versus a conservative strategy. Hospital and professional costs initially and over 6 months, including outpatient costs, will be assessed. Hospital costs will be determined for patients in the United States from the UB92 formulation of the hospital bill, with costs derived from charges using departmental cost to charge ratios. Professional costs will be determined by accounting for professional services and then converted to resource units using the Resource Based Relative Value Scale and then to costs using the Medicare conversion factor. Follow-up resource consumption, including medications, testing and office visits, will be carefully measured with a Patient Economic Form, and converted to costs from the Medicare fee schedule. Health-related quality of life will be assessed with a specific instrument, the Seattle Angina Questionnaire, and a general instrument, the Health Utilities Index at baseline, 1, and 6 months. The Health Utilities Index will also be used to construct a utility. By knowing utility and survival, quality-adjusted life years will be determined. These measures will permit the performance of a cost-effectiveness analysis, with the cost-effectiveness of the invasive strategy defined and the difference in cost between the invasive and conservative strategies divided by the difference in quality-adjusted life years. The economic and health-related quality of life aspects of TACTICS-TIMI 18 are an integral part of the study design and will provide a comprehensive understanding of the impact of invasive versus conservative management strategies on a broad range of outcomes after hospitalization for unstable angina or non-Q-wave myocardial infarction.

The changing healthcare market and how it has influenced the treatment of cardiovascular disease--Part 1.

The dramatic transformations taking place in the healthcare environment have created a new paradigm for healthcare and pose far-reaching changes for cardiovascular care. This 2-part paper reviews these changes and discusses the major implications for cardiovascular specialists, based on literature reviews and summaries of legislative initiatives. The new healthcare paradigm focuses on a continuum of care, wellness maintenance and promotion, accountability for the healthcare of defined populations, and provider differentiation based on ability to add 'value' to the patient's healthcare outcome. This paradigm will become 'standard operating procedure' in the cardiovascular market. As a result, major areas of change in the cardiovascular environment include: continuing growth of managed care arrangements, expanding physician and other payment reforms, growing influence of state and private payer initiatives, expanding role of 'centers of excellence,' continuing surplus of physicians, growth in pharmaceuticals and new technologies, and extension of evidence-based guidelines. Practice guidelines, in particular, will become an integral part of medical practice and will represent the standards against which medical practice will be measured. Given the prominent position of cardiovascular disease in healthcare, cardiovascular specialists will remain in the forefront of these developments.

The changing healthcare market: outlook for the future of cardiovascular disease treatment--Part 2.

This paper, the second in a series of 2, reviews major developments and trends in the current healthcare arena that will affect cardiovascular disease (CVD) treatment over the next 10 years. The paper also discusses the implications and future outlook for cardiovascular services in a managed care environment.

The effect of primary care gatekeepers on the management of patients with chest pain.

OBJECTIVE: To determine whether patients with chest pain referred to a cardiologist from a gatekeeper managed care organization differ from those referred from an open-access managed care organization. STUDY DESIGN: Retrospective study using clinical and claims data from a cardiac network database. PATIENTS AND METHODS: We reviewed data from 1414 patients with chest pain or angina who were referred to a cardiologist between January 1, 1995, and June 30, 1996. We examined baseline clinical characteristics and subsequent physician practice patterns for these patients, who were referred from either a primary care gatekeeper model (n = 490) or an open-access model (n = 924). RESULTS: Although twice as many open-access patients were referred to a cardiologist, there were no differences in patient demographics or clinical characteristics at the time of referral. Cardiologists ordered similar diagnostic tests for patients from both types of managed care plans, and gatekeeper patients did not have a higher rate of abnormal tests. Rates of cardiac catheterization, coronary angioplasty, myocardial infarction, and hospitalization were similar in both groups. A significantly higher percentage of gatekeeper patients received a cardiac catheterization on the day of referral (7% versus 1%; P = .05). Open-access patients were significantly more likely to continue to be seen by a cardiologist (44% versus 28%; P < .01). Cardiology professional charges per patient were lower among gatekeeper patients ($972 +/- 1398 versus $1187 +/- 1897; P = .06), and total cardiology professional charges were significantly lower for the gatekeeper group because of the smaller number of patients seen. CONCLUSIONS: The type of cardiology services provided to patients with chest pain was not affected by the primary care administrative structure of the managed care organization, but the higher volume of patient referrals from the open-access plan may be an important consideration for cardiology practices participating in capitated contracts. The lower volume of referrals and coordination of care suggest potential cost advantages for the gatekeeper model.

Benchmarking cardiac catheterization laboratories: the impact of patient age, gender and risk factors on variable costs, device costs, total time and procedural time in 53 catheterization laboratories.

Coronary catheterization laboratories (CCLs) are the cornerstones of the delivery system for many cardiovascular procedures performed in the United States. However, few comprehensive data exist benchmarking physician activities in CCLs. This study benchmarks cost and time data on 82,548 consecutive patient encounters in 53 CCLs for the 18-month period of January 1997 through June 1998. The data are compiled from the OEP program, a relational database developed by Boston Scientific/Scimed (Maple Grove, Minnesota) for use in CCLs. CCL productivity (total time and procedure time) and cost (variable costs and device costs) benchmarks are created for: 1) left heart catheterization; 2) right and left heart catheterization; 3) percutaneous transluminal coronary balloon angioplasty (PTCA); 4) atherectomy; and 5) coronary stents. Results show the variable costs (those costs that vary in direct proportion to changes in CCL activities) for the five procedures are: $308, left heart catheterization; $395, right and left heart catheterization; $841, PTCA; $2,768, atherectomy; and $3,186, coronary stent. These variable costs are lower than the typical average costs reported for these procedures because they do not include hospital, laboratory, and physician costs, only the procedure-specific activity-related costs most directly controlled and/or influenced by CCL physicians or administrators. The total time for the left heart catheterization averaged 64 minutes and 84 minutes for the right and left heart catheterization, respectively, and procedural times averaged 25 and 32 minutes, respectively. For the major interventional procedures N PTCA, atherectomy, and coronary stents, total times averages were 102, 135, and 117 minutes, respectively. Procedural times for these procedures averaged between 60 and 65 percent of the total time. The major implications of these findings are discussed and limitations noted.

Improving cost and outcome of coronary surgery.

BACKGROUND: There has been increasing interest in improving the outcome of coronary surgery while also seeking to minimize cost. It was the purpose of the present study to determine changes in the outcome and cost of CABG between 1988 and 1996. METHODS AND RESULTS: The outcome and costs for 12,266 patients undergoing CABG were evaluated. Clinical data were gathered from the Emory Cardiovascular Database, and financial data were obtained from the UB92 formulation of the hospital bill. Charges were reduced to cost through the use of departmental cost-to-charge ratios. Costs were inflated to 1996 costs by using the medical care inflation rate. The patients became sicker, especially with increased incidences of hypertension, diabetes, and prior myocardial infarctions and a decrease in ejection fraction over the study period. Mortality rates tended to decrease from 4.7% to 2.7% (P = 0.07). After accounting for increasing indexes of severity of disease over the period, there was a significant decrease in death (OR, 0.90/y; P = 0.0001). Q-wave myocardial infarction rate fell from 4.1% to 1.3% (P < 0.0001). Mean hospital cost decreased from $22,689 to $15,987. Length of stay after surgery decreased from 9.2 to 5.9 days. After accounting for other variables, cost decreased by $1118 per year, and annual length of stay decreased by 0.55 day. CONCLUSIONS: The outcome of CABG continues to improve with declines in mortality rate and Q-wave myocardial infarction. This was accomplished while decreasing costs and length of stay. Whether these favorable trends will continue remains to be seen.

Does hospital procedure-specific volume affect treatment costs? A national study of knee replacement surgery.

OBJECTIVE: The long-run cost savings potential of private sector reform efforts, such as selective contracts with providers, depends in part on the relationship between procedure-specific volume and average hospital resources that are consumed in treating patients associated with that specific procedure. Study examines a model that estimates the relationship between hospital procedure-specific volume and average hospital treatment costs, using an elective surgical procedure as an example. DATA SOURCES: Medicare Provider Analysis and Review (MedPAR) files for 1989 for hospitalizations in which a Medicare beneficiary received a knee replacement (KR) surgery during 1989. Hospital information was obtained from the American Hospital Association's 1989 Annual Survey. All patient-level data were aggregated to the hospital level to create a data file, with the hospital as the unit of observation. STUDY DESIGN: This study used administrative claims data and regression analysis to estimate the effect of hospital procedure-specific volume on average hospital treatment costs of patients receiving KR surgery. We also examined the stability of the volume-cost relationship across hospitals of different sizes. PRINCIPAL FINDING: The average treatment costs associated with KR surgery are inversely related to a hospital's KR volume in the regression equation estimated using all hospitals performing KR surgery. The inverse relationship between cost and volume is found to be robust for different-size hospitals. CONCLUSIONS: The potential cost savings associated with performing KR surgery at incrementally higher hospital volume level can amount to as much as 10 percent of the hospital's average treatment cost. However, the incremental cost savings associated with increased patient volume depends on the hospital's current volume level and its size.

Factors related to potentially preventable hospitalizations among the elderly.

OBJECTIVES: The authors examine whether the odds of having a hospitalization associated with an ambulatory care sensitive condition can be explained by observed differences in a Medicare beneficiary's predisposing, enabling, and need characteristics. METHODS: A multivariate cross-sectional analysis of Medicare's administrative inpatient claims data and the Medicare Current Beneficiary Survey was conducted on a nationally representative sample of Medicare beneficiaries. Each Medicare beneficiary's hospital utilization was classified into one of three categories: (1) no hospital admissions; (2) hospitalized, but no hospitalizations for a potentially preventable condition; and (3) at least one potentially preventable hospitalization. RESULTS: The results suggest that being older, black, or living either in a core standard metropolitan statistical area (SMSA) county or a rural county significantly increases the odds of a preventable hospitalization, whereas having attended college, or having only Medicare insurance coverage reduces the odds of a preventable hospitalization. Further, those individuals who assess their health status as poor, have had coronary heart disease, a myocardial infarction, or diabetes, and required assistance with two or more of the six basic activities of daily living are at a greater risk of a preventable hospitalization. CONCLUSIONS: Policy efforts aimed at reducing the number of preventable hospitalizations among the elderly should address the complex health care delivery needs of those Medicare beneficiaries who have special health care needs because they are very old, black, live in core SMSA or rural counties, have poor overall health status, and have physical limitations. Efforts to reduce the number of Medicare beneficiaries who experience a preventable hospitalization may be cost-effective as these beneficiaries may account for up to 17.4% of Medicare's reimbursement for inpatient, outpatient, and physician services in our data set.

Expected hospital costs of knee replacement for rural residents by location of service.

This article assesses the relative cost of providing a specific procedure, knee replacement (KR) surgery, to rural residents in rural community-based hospitals rather than in urban hospitals. Costs are predicted using regression analysis with readily available data from Health Care Financing Administration's Medicare Provider Analysis and Review. The specification incorporates the effect of referral patterns on volume and the subsequent impact on costs in the different settings. The predicted cost per case was found to be lower in rural rather than urban hospitals across all patient types. Findings indicate scale economies exist for KR surgery in both the urban and rural hospital settings. Results also suggest the total cost of a hospitalization associated with KR surgery in rural hospitals is more sensitive to changes in procedure volume than in urban hospitals, providing preliminary support for increased regionalization of KR surgery in rural hospitals. While long-term outcome measures associated with successful KR surgery (improved function, reduced pain, etc.,) are not available, mortality rates and perisurgical complication rates were not significantly different between rural patients who received KR surgery in rural hospitals and those who received KR surgery in urban hospitals. Among rural hospitals, however, complication rates were significantly correlated with procedure volume (complication rates were significantly lower in rural hospitals that performed more than nine KR surgeries a year). Our results suggest KR surgery can be delivered efficiently in rural community-based settings and support the case for regionalization of this procedure. Key words: rural hospital; hospital cost; economics of scale; regionalization.

Predicting hospital costs among older decedents over time.

To explain the variation in total real hospital costs among elderly patients who died between 1984 and 1991, a cohort analytic study of the nationally representative sample of elderly subjects included in the Longitudinal Study on Aging (N = 7,527) was carried out. The cohort comprised the subset of 1,778 community-dwelling Americans who were age 70 years and older in 1984, had one or more subsequent hospital episodes, and died by 1991. Hospital charges for 1984 through 1991 were taken from the Medicare Automated Data Retrieval System. Annual hospital charges were adjusted for inflation (restated in 1984 dollars) using the hospital market basket component of the consumer price index. The natural logarithm of aggregated real charges was used in the analysis. Mean total real hospital charges were $24,956 (SD = $27,847). A standard multivariable regression model explained 9.7% of the variance in real total hospital charges. After incorporating additional measures reflecting a respondent's distribution (mean and standard deviation) of comorbidities (as measured by the number of ICD-9-CM codes [truncated at five]) during all hospitalizations in the observation window, the cause of death, and the concentration of charges in the last year of life, the explained variance increased to 29.3%. The most important explanatory factors were the two variables controlling for the distribution of comorbidity, the variable controlling for population density, and the dichotomous variable indicating that the patient's death was related to an acute myocardial infarction. Total real hospital resources consumed by elderly decedents vary substantially. The concentration of resources consumed in the last year of a respondent's life was only marginally significant in predicting total real hospital charges over an 8-year observation window.

The use of a break-even analysis: financial analysis of a fast-track program.

OBJECTIVE: To calculate the financial break-even point and illustrate how changes in third-party reimbursement and eligibility could affect a program's fiscal standing. METHODS: Demographic, clinical, and financial data were collected retrospectively for 446 patients treated in a fast-track program during June 1993. The fast-track program is located within the confines of the emergency medicine and trauma center at a 1,050-bed tertiary care Midwestern teaching hospital and provides urgent treatment to minimally ill patients. A financial break-even analysis was performed to determine the point where the program generated enough revenue to cover its total variable and fixed costs, both direct and indirect. RESULTS: Given the relatively low average collection rate (62%) and high percentage of uninsured patients (31%), the analysis showed that the program's revenues covered its direct costs but not all of the indirect costs. CONCLUSIONS: Examining collection rates or payer class mix without examining both costs and revenues may lead to an erroneous conclusion about a program's fiscal viability. Sensitivity analysis also shows that relatively small changes in third-party coverage or eligibility (income) requirements can have a large impact on the program's financial solvency and break-even volumes.