Distribution of variable vs fixed costs of hospital care.

CONTEXT: Most strategies proposed to control the rising cost of health care are aimed at reducing medical resource consumption rates. These approaches may be limited in effectiveness because of the relatively low variable cost of medical care. Variable costs (for medication and supplies) are saved if a facility does not provide a service while fixed costs (for salaried labor, buildings, and equipment) are not saved over the short term when a health care facility reduces service. OBJECTIVE: To determine the relative variable and fixed costs of inpatient and outpatient care for a large urban public teaching hospital. DESIGN: Cost analysis. SETTING: A large urban public teaching hospital. MAIN OUTCOME MEASURES: All expenditures for the institution during 1993 and for each service were categorized as either variable or fixed. Fixed costs included capital expenditures, employee salaries and benefits, building maintenance, and utilities. Variable costs included health care worker supplies, patient care supplies, diagnostic and therapeutic supplies, and medications. RESULTS: In 1993, the hospital had nearly 114000 emergency department visits, 40000 hospital admissions, 240000 inpatient days, and more than 500000 outpatient clinic visits. The total budget for 1993 was $429.2 million, of which $360.3 million (84%) was fixed and $68.8 million (16%) was variable. Overall, 31.5% of total costs were for support expenses such as utilities, employee benefits, and housekeeping salaries, and 52.4% included direct costs of salary for service center personnel who provide services to individual patients. CONCLUSIONS: The majority of cost in providing hospital service is related to buildings, equipment, salaried labor, and overhead, which are fixed over the short term. The high fixed costs emphasize the importance of adjusting fixed costs to patient consumption to maintain efficiency.

Costs of an emergency department-based accelerated diagnostic protocol vs hospitalization in patients with chest pain: a randomized controlled trial.

CONTEXT: More than 3 million patients are hospitalized yearly in the United States for chest pain. The cost is over $3 billion just for those found to be free of acute disease. New rapid diagnostic tests for acute myocardial infarction (AMI) have resulted in the proliferation of accelerated diagnostic protocols (ADPs) and chest pain observation units. OBJECTIVE: To determine whether use of an emergency department (ED)-based ADP can reduce hospital admission rate, total cost, and length of stay (LOS) for patients needing admission for evaluation of chest pain. DESIGN: Prospective randomized controlled trial comparing admission rate, total cost, and LOS for patients treated using ADP vs inpatient controls. Total costs were determined using empirically measured resource utilization and microcosting techniques. SETTING: A large urban public teaching hospital serving a predominantly African American and Hispanic population. PATIENTS: A sample of 165 patients was randomly selected from a larger consecutive sample of 429 patients with chest pain concurrently enrolled in an ADP diagnostic cohort trial. Eligible patients presented to the ED with clinical findings suggestive of AMI or acute cardiac ischemia (ACI) but at low risk using a validated predictive algorithm. MAIN OUTCOME MEASURES: Primary outcomes measured for each subject were LOS and total cost of treatment. RESULTS: The hospital admission rate for ADP vs control patients was 45.2% vs 100% (P<.001). The mean total cost per patient for ADP vs control patients was $1528 vs $2095 (P<.001). The mean LOS measured in hours for ADP vs control patients was 33.1 hours vs 44.8 hours (P<.01). CONCLUSIONS: In this trial, ADP saved $567 in total hospital costs per patient treated. Use of ED-based ADPs can reduce hospitalization rates, LOS, and total cost for low-risk patients with chest pain needing evaluation for possible AMI or ACI.

Model curriculum for physician training in emergency ultrasonography.

A model curriculum for the implementation and training of physicians in emergency medicine ultrasonography is described. Widespread use of limited bedside ultrasonography by emergency physicians will improve diagnostic accuracy and efficiency, increase the quality of care, and prove to be a cost-effective technique for the practice of emergency medicine.