David H. Stone, Alexander J. Horvath, Philip P. Goodney, Robert M. Zwolak, Randall R. De Martino, Daniel Walsh, Brian Nolan, Eva M. Rzucidlo, Richard J. Powell
Dartmouth-Hitchcock Medical Center, Lebanon, NH.
OBJECTIVES: Endovascular aneurysm repair (EVAR) is associated with significant device costs that place it at odds with efforts to constrain health care expenditures. This study examines costs and operating margins associated with EVAR at a tertiary care academic medical center.
METHODS: All infrarenal EVARs performed from April 2011 to March 2012 were identified (n=129). Among this cohort, 49 patients met standard commercial IFU guidelines, were treated using a single manufacturer device, and billed to Medicare DRG 238. Of these 49 patients, net technical operating margins were calculated in conjunction with the hospital finance department. EVAR implant costs were determined for each procedure. DRG 238 costs and LOS were benchmarked against other academic medical centers using UHC 2012 data.
RESULTS: Among the studied EVAR cohort (age 75, 82% male, mean LOS 1.7 days), mean technical costs totaled $31,672. Graft implants accounted for 52% of the technical costs. Institutional overhead was 17% ($5,495) of total technical costs. EVAR associated technical operating margins were -$4,015 per procedure (Figure 1). Margin losses were amplified when professional costs and revenues were included. Institutional costs and LOS were in the lowest quartile nationally when benchmarked against comparable centers using UHC DRG 238 costs.
CONCLUSIONS: EVAR is associated with negative operating margins among Medicare beneficiaries, and device costs account for more than 50% of the technical costs. These data indicate EVAR must undergo care delivery redesign including device cost reduction for this practice to remain sustainable.
AUTHOR DISCLOSURES: R. R. De Martino: Nothing to disclose; P. P. Goodney: Nothing to disclose; A. J. Horvath: Nothing to disclose; B. Nolan: Nothing to disclose; R. J. Powell: Nothing to disclose; E. M. Rzucidlo: Nothing to disclose; D. H. Stone: Nothing to disclose; D. Walsh: Nothing to disclose; R. M. Zwolak: Nothing to disclose.
Posted April 2013