DOI 10.1378/chest.113.4.896 1998;113;896-899Chest

 Warren, J. Peter Szidon and Steven KestenEllen H. Elpern, Kathleen G. Behner, Bryce Klontz, William H. Analysis of Hospital CostsLung Volume Reduction Surgery : An

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Lung Volume Reduction Surgery*An Analysis of Hospital Costs

Ellen H. Elpern, RN, MSN; Kathleen G. Behner, MRA; Bryce Klontz, RA;William H. Warren, MD; f. Peter Szidon, MD; and Steven Kesten, MD

Objective: Lung volume reduction surgery (LVRS) represents a potential breakthrough in themanagement of advanced emphysema, although questions remain about clinical and economicimplications of widespread application of LVRS. In this report, we describe hospital costs,excluding physicians' fees, for LVRS.Design: Hospital charges were obtained from billing records and converted to costs by applyingmultiple cost-to-charge ratios.Setting: A large, urban academic medical center.Patients: Fifty-two consecutive patients who received bilateral LVRS through a median sternot¬omy between April 1995 and August 1996.Results: Median hospital stay was 10 days (mean=14.8±12.8 days; range=3 to 48 days), including2 days (mean=6±9.2 days; range=1 to 35 days) in the ICU. One hospital death occurred. Hospitalcosts per case ranged from $11,712 to $121,829, with mean costs of $30,976 and median costs of$19,771. Costs were related significantly to duration of ICU stay and length of hospitalization.Patients who accrued the highest costs were significantly older than the remainder of the sample(69.3 years vs 62.4 years).Conclusions: Hospital costs of LVRS vary significantly but are related directly to hospital stay.Identification of factors associated with prolonged stays can be used in assessing benefits andrisks of LVRS against utilization of health-care dollars. (CHEST 1998; 113:896-99)

Key words: costs; economics; lung volume reduction surgery

Abbreviations: LVRS=lung volume reduction surgery; OR=operating room

/^ osts related to disability and treatment ofCOPD^^ comprise a substantial portion of total health¬care expenditures. Lung volume reduction surgery(LVRS) has emerged recently as a treatment modal¬ity for patients with advanced emphysema. LVRS hasthe potential to improve lung function, reduce dys¬pnea, and improve quality of life in selected individ¬uals with emphysema.1-3 Selection criteria for LVRSare presently evolving and variability among medicalcenters has been observed.4 Considerable debate hasensued about the proper role of LVRS in themanagement of emphysema.5-6

If LVRS becomes an established option for thetreatment of emphysema, it will be necessary toassess the financial implications to the health-caresystem. Given the prevalence of COPD in thiscountry, if even a small minority of individuals withCOPD were eligible for LVRS, the expenses for

*From Rush-Presbyterian-St. Luke's Medical Center, Chicago.Manuscript received April 29, 1997; revision accepted October14, 1997.Reprint requests: Ellen H. Elpern, RN, MSN, 1725 W. Harrison,Suite 836, Chicago, IL 60612

hospitals and payers would be large. Basic cost dataare necessary for an economic evaluation of LVRS.Costs incurred with LVRS have been reported infre¬quently. Therefore, we sought to analyze hospitalcosts for LVRS performed at our institution, includ¬ing total costs, distribution of costs, and relationshipamong costs and hospital course.

Materials and Methods

Study PopulationConsecutive patients with disabling dyspnea due to advanced

emphysema who had LVRS between April 1995 and August 1996were included in this analysis. All patients had LVRS performedby the same surgeon at a single academic medical center.

Patient Selection

Eligibility criteria for LVRS included the following: severe

emphysema, disabling dyspnea, nonsmoking for a minimum of 6months, age <75 years, hyperinflation on chest radiograph,heterogeneous disease with target areas for resection as noted byCT ofthe thorax, F¥Nl <40% predicted, PaC02 of <60 mm Hg,

896 Clinical Investigations

 1998 by the American College of Chest Physicians by guest on July 21, 2011chestjournal.chestpubs.orgDownloaded from

mean pulmonary artery pressure <35 mm Hg or pulmonaryartery systolic pressure <50 mm Hg (determined by pulmonaryartery catheterization or estimated by echocardiography), abilityto participate in preoperative and postoperative pulmonary reha¬bilitation, and absence of significant cardiac or neurologic disor¬ders. These selection criteria were refined over the study dura¬tion and early exceptions occurred as follows: two patients were

aged 78 years, one individual had a preoperative PaC02 of 71 mmHg, and six patients did not complete a full course of preopera¬tive pulmonary rehabilitation.

Operative TechniqueBilateral lung resections were performed via*median sternot¬

omy incisions. Upper lobe resections were performed in 49patients and lower lobe resections were performed in 3 individ¬uals. All resections were accomplished with stapling over bovinepericardium.

Postoperative ManagementWhenever possible, patients were extubated in the operating

room (OR) immediately after surgery. Postoperatively, patientswere transferred to the surgical ICU where they remained untilsuch time as they were fully alert, in hemodynamically stablecondition, and able to maintain adequate oxygenation and venti¬lation without mechanical ventilatory support. Pain managementwas provided by epidural catheters and patient-controlled anal¬gesia systems. Chest tubes were connected to 20 cm H20suction. Heimlich valves were used when persistent (>5 days) airleaks were present to allow for discharge from the hospital.Coughing, deep breathing, incentive spirometry, and early am-

bulation were employed routinely by the nursing staff. Patientswere encouraged to resume participation in pulmonary rehabil¬itation as soon as possible after hospital discharge.

Hospital Costs

Costs were defined as the dollar amount of resources utilizedto provide all aspects of the inpatient stay, including direct andindirect costs. Hospital costs excluded physicians' fees andoutpatient evaluations. Costs were calculated by applying multi¬ple cost-to-charge ratios to inpatient charges. In our institution,138 ratios are used that are updated annually. A step-downmethod was used to allocate indirect costs to cost centers. In thismethod, the indirect department that receives the least amountof services from other indirect departments and provides themost service to other departments allocates its costs first. Asimilar analysis follows to determine the order of cost allocationfor each remaining indirect department.7 Overhead costs such as

housekeeping costs were allocated to cost centers based on

square feet, while billing department costs were allocated basedon revenue.

Costs were divided into seven categories designated as routine,OR, ICU, respiratory therapy, pharmacy, laboratory, and radiol¬ogy. Routine costs included room and board costs for a non-ICUbed, associated nursing care, supplies, and overhead. ICU costsincluded ICU room, board, nursing care, supplies, and overhead.

Data AnalysisData were summarized as proportions, means, medians, or

ranges. Associations between costs and other variables were

determined by calculation of correlation coefficients (Pearson r).X2 and unpaired t tests were used to compare differences in costsbetween patient groups. Statistical significance was considered at

p<0.05.

Results

Patient PopulationThe study group included 52 patients: 27 men and

25 women. The ages of the patients ranged from 48to 78 years, with a mean of 63.5 years. Meanpreoperative pulmonary functions test results andarterial blood gas values for the group are found inTable 1. The mean FEV2 was 23% of predicted.Thirteen patients had preoperative PaC02 values>50 mm Hg. The primary insurer of this group was

Medicare (71%). Other sponsors included commer¬

cial insurers (17%), health maintenance organiza¬tions or preferred provider organizations (8%), andpublic aid (4%).

Hospital Course

Postoperative hospital stays ranged from 3 to 48days, with a mean of 14.8 days and a median of 10days. ICU stays ranged from 1 to 35 days, with a

median stay of 2 days and a mean ICU stay of 6 days.The most frequent postoperative complication was

prolonged (>7 days) air leak, experienced by 50% ofpatients (Table 2). Although most patients were ableto be extubated immediately postoperatively, 10subjects required >5 days of mechanical ventilation.Ten patients developed arrhythmias, none of whichwere life threatening or required cardioversion. Onepatient died during hospitalization on the fourthpostoperative day. Death followed the developmentof ARDS.

Costs

Total hospital costs for the entire sample were

$1,608,697. A frequency distribution of costs shownin Figure 1 demonstrated that costs in this samplewere not normally distributed. Hospital costs per

Table 1.Profiles of 52 Patients Selected for LVRS*Characteristic Mean Value±SD (% Predicted)

Age, yrGender, male/femaleFVC, LFEVi, LTLC, LRV, LDeo, mL/mm Hg/min6-min walk, feetpHPa02, mm HgPaC02, mm HgHC03, mEq/L

63.5±7.3; range: 48-7827/25

1.86±0.65(51)0.65±0.23 (23)6.6±2.1 (112)4.6±1.7(182)

5.86±4.0 (27)798 ±3317.41±0.0361±18.2

45.2±8.628.5±4.6

*TLC=total lung capacity; RV=residual volume; Dco=diffusingcapacity of the lung; HCOs=bicarbonate.

CHEST / 113 / 4 / APRIL, 1998 897

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Table 2.Hospital Course for 52 Patients ReceivingLVRS* ROUTINE

13%

Postoperative Complications No. (%) of SubjectsAir leak >7 dVentilator >5ArrhythmiasPneumonia

Hospital death

26(50)10 (19)10 (19)5 (10)1(4)

*Median hospital days, 10 (range, 3 to 48 days); median ICU days, 2

(range, 1 to 35).

case ranged from $11,712 to $121,829 with a mean of$30,976 and a median of $19,771. Costs were relatedsignificantly to length of hospital stay (r=0.88;p<0.01) and length of ICU stay (r=0.95; p<0.01). Abreakdown of costs according to specific cost cate¬

gories is depicted in Figure 2. ICU and OR costsaccounted for more than half (57%) of total hospitalcosts.

Cost comparisons were made of patients groupedaccording to age, gender, and the presence or ab¬sence of the following complications during hospital¬ization: air leak >7 days, mechanical ventilation >5days, pneumonia, and arrhythmias. No significantdifferences in costs were associated with differencesin age, gender, or air leak >7 days. Significant costincreases were associated with mechanical ventila¬tion >5 days (p<0.001), arrhythmias (p<0.001), andpneumonia (p<0.001).

Patients were divided into two groups according to

hospital costs: those whose costs were <$20,000 andthose whose costs were >$20,000. No significantdifferences were noted between groups for age, sex,forced expiratory volume, FEV1? PaC02, tension or

6-minute walk distance. Patients with costs

<$20,000 had an average FEVt of 0.71 L, comparedwith a mean value of 0.59 L for patients with costs of> $20,000, a difference that approached statisticalsignificance (p=0.06).

100+

80

60

40

20

0

COSTS$X103

10 15 20

NUMBER OF CASES

25 30

RESPIRATORYTHERAPY

9%

LABORATORY10%

PHARMACY4%

RADIOLOGY7% OPERATING

ROOM27%

Figure 1. Frequency distribution of total hospital costs forLVRS.

Figure 2. Breakdown of hospital costs for LVRS.

The eight patients whose hospital costs were

> $50,000 were compared with the remaining pa¬tients in the sample. As expected, the highest cost

group had significantly longer ICU stays (26.5 daysvs 2.7 days), total hospital days (39 days vs 11.1 days),postoperative arrhythmias (p=0.02), postoperativepneumonias (p=0.004), and prolonged ventilatordependence (p=0.022). Patients with the highesttotal hospital costs were significantly older thanothers in the sample (69.2±5.1 years vs 62.4±7.2years) (p=0.01). No other significant differenceswere found among demographic variables or preop¬erative indexes.

Discussion

We have assessed hospital expenses for LVRSperformed at an urban academic medical center. Wehave reported costs rather than charges becausecosts better reflect resources used than do charges,which are prices set by the institution. Hospital costs

per case were variable but substantial, ranging from$11,712 to $121,829 with a median of $19,771.Longer hospitalizations, particularly longer ICUstays, were associated with the highest hospital costs.This suggests that actions resulting in fewer postop¬erative complications, especially those requiring con¬

tinued ICU care, would reduce costs significantly.Although the population sample size in this study

was relatively small, we sought to uncover variablesassociated with patients most likely to accrue highhospital costs. Our findings and other preliminarydata8 suggest that advanced age should be exploredas a possible contributor to longer hospitalizationsand higher hospital costs.Few reported experiences with LVRS have in¬

cluded expense data. When mentioned, referencesto expenses are anecdotal with little, if any, descrip-

898 Clinical Investigations 1998 by the American College of Chest Physicians

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tion of patients, techniques, and methods used toestimate expenses. Charges are reported more oftenthan costs, although definitions of these terms are

rarely provided. Charges for LVRS via median ster¬

notomy are estimated to be $30,000 to $45,000.5-9Hospital charges of $17,513 have been reported forLVRS via laser thoracoscopy requiring a 10-dayhospital stay.10A detailed financial breakdown of costs of LVRS

was described by Albert and colleagues.11 Financialdata from 23 patients treated with LVRS at theUniversity of Washington Medical Center were re¬

viewed. The type of operative procedure performedwas not specified. Patients spent an average of 8 daysin the hospital and 1 day in the ICU. Median costs ofLVRS, including preoperative evaluation and hospi¬talization, and excluding professional fees, were es¬

timated to be $16,065. This compares with mediancosts for our sample, excluding physicians' fees, of$19,771 for a 10-day hospital stay with 2 ICU days.In both reports, most hospital expenses were attrib¬utable to room costs (ICU, general unit) and ORcosts. Total charges were related directly to length ofhospitalization.

Generalization of our results should be under¬taken cautiously. Numerous factors can potentiallyinfluence expenses reported for LVRS, includingdefinitions of expenses (costs, charges), methods forcalculating expenses, the hospital setting (academic,community), patient selection criteria, experienceand proficiency of the clinical team, operative tech¬nique, and clinical management protocols. Never¬theless, our sample of patients is similar to otherreported series of patients undergoing LVRS bymedian sternotomy1213 with respect to preoperativephysiologic profiles, operative technique, and occur¬

rences of postoperative complications. In addition,our method for estimating costs by applying cost-to-

charge ratios to observed charges is used commonlyto estimate hospital costs. Therefore, our hospitalcosts for the surgical admission are likely similar tothose other centers might anticipate, employing sim¬ilar cost accounting methods, selection criteria, andoperative technique.The description of costs noted in this and other

reports is perhaps best viewed as a preliminary stepto future studies in which cost consequences ofLVRS are considered. Cook and Ellrodt14 recentlydescribed economic evaluations that compare costsand consequences among alternate courses of action.

Examples of potential economic evaluations of LVRSinclude comparing hospital length of stay and costsof LVRS performed via thoracoscopy vs mediansternotomy (cost effectiveness); determining the ef¬fect of LVRS on patients' annual health-care expen¬ditures (cost benefit); and determining the impact ofLVRS on length of survival and quality of life (costutility). Given the prevalence of chronic obstructivelung disease in this country, continued reports are

necessary to determine whether sufficient benefit isprovided to justify expenditures.

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DOI 10.1378/chest.113.4.896 1998;113; 896-899Chest

J. Peter Szidon and Steven KestenEllen H. Elpern, Kathleen G. Behner, Bryce Klontz, William H. Warren,Lung Volume Reduction Surgery : An Analysis of Hospital Costs

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