Preoperative spirometry and laparotomy: blowing away dollars.

STUDY OBJECTIVE: Increasing evidence indicates that routine preoperative diagnostic spirometry (pulmonary function tests [PFTs]) before elective abdominal surgery does not predict individual risk of postoperative pulmonary complications and is overutilized. This economic evaluation estimates potential savings from reduced use of preoperative PFTs. DESIGN: Analyses of (1) real costs (resource consumption to perform tests) and (2) reimbursements (expenditures for charges) by third-party payers. SETTING: University-affiliated public and Veterans Affairs hospitals. PATIENTS: Adults undergoing elective abdominal operations. MEASUREMENTS AND RESULTS: Average real cost of PFTs was $19.07 (95% confidence interval [CI], $18.53 to $19.61), based on a time and motion study. Average reimbursement expenditure by third-party payers for PFTs was $85 (range, $33 to $150; 95% CI, $68 to $103), based on Medicare payment of $52 and a survey of nine urban US hospitals with a spectrum of bed sizes and teaching status. Estimates from published literature included the following: (1) annual number of major abdominal operations, 3.5 million; and (2) proportion of PFTs not meeting current guidelines, 39% (95% CI, 0.31 to 0.47). Local data were used when estimates were not available in the literature: (1) proportion of laparotomies that are elective, 76% (95% CI, 0.73 to 0.79); and (2) frequency of PFTs before laparotomy, 69% (95% CI, 0.54 to 0.84). Estimated annual national real costs for preoperative PFTs are $25 million to $45 million. If use of PFTs were reduced by our estimate for the proportion of PFTs not meeting current guidelines, potential annual national cost savings would be $7,925,411 to $21,406,707. National reimbursement expenditures by third-party payers range from more than $90 million to more than $235 million. If use were reduced, potential annual savings in reimbursements would be $29,084,076 to $111,345,440. Potential savings to Medicare approach $8 million to $20 million annually. CONCLUSION: Reduced use of PFTs before elective abdominal surgery could generate substantial savings. Current evidence indicates reduced use would not compromise patients' outcomes.

Costs of diabetes in Texas, 1992.

OBJECTIVE: To estimate direct and indirect costs of diabetes in Texas in 1992. RESEARCH DESIGN AND METHODS: For most direct medical costs, we relied on third party and provider billing databases, including Medicare, Medicaid, VA facilities, public hospitals, and others. The researchers identified people with diabetes in the respective databases, located all records of their care, and sorted records as clearly, probably, or probably not attributable to diabetes on the basis of principal diagnoses. In most cases, costs were valued as allowable or paid charges. Some medical costs, such as private insurance, were estimated from national data and state surveys. Indirect costs included current short- and long-term disability costs and the discounted present value of future costs of mortality. Disability estimates relied on National Health Interview Survey (NHIS) data and U.S. Department of Labor wage data applied to Texas. Mortality estimates were based on death certificates. RESULTS: Total costs clearly or probably attributable to diabetes among Texans in 1992 were estimated at $4.0 billion. Direct medical costs were approximately $1.6 billion. Indirect costs were estimated at $2.4 billion. the largest direct costs were paid by Medicare. Most indirect costs were from long-term disability. CONCLUSIONS: This study demonstrates methods for conducting cost of illness studies at the state level. In a state like Texas, with a large and growing Mexican-American population, estimation of current and future economic costs of diabetes is vital for development of strategies to minimize social and economic consequences of diabetes.

Problems in interpreting cost effectiveness in clinical trials. Experimental versus implementation costs.

OBJECTIVE: To demonstrate the difficulty of estimating cost effectiveness of alternative implementation strategies using clinical trial data. DESIGN: Two examples drawn from a hearing-aid intervention trial and a physical-therapy trial for frail elderly are used to demonstrate how alternative implementation strategies may affect cost effectiveness. Sensitivity analysis is used to document a range of possible economic outcomes for each example and show how assumptions based on trials may bias implementation decisions. MAIN OUTCOME MEASURES: Costs and cost-effectiveness ratios are estimated for alternative implementation strategies and compared with trial results. MAIN RESULTS: Staffing and equipment substitutions, reconfigurations, and economies of scale can reduce the cost of trial interventions substantially. Such resource alterations as well as protocol and target group modifications may also have an impact on effectiveness. In both examples effectiveness can be reduced by as much as 50% and under certain conditions alternative implementation strategies will still be cost effective. CONCLUSIONS: Cost effectiveness of implementations can differ substantially from a trial when different resources or target populations are incorporated. Institutions must conduct preimplementation studies which consider alternative resource configurations before adopting an intervention based on trial results.