ECONOMICS

Surgical facilities and operating room suites are aggressively managing costs as a strategy to maintain profitability. Managed care has transformed the operating room suite, including the PACU, from a revenue center to a cost center.

Cost Structure

Hospitals have traditionally used a "top-down" costing approach that breaks down department expenditures to determine how much delivering care costs. This method estimates a department's costs for a patient by multiplying departmental charges for a patient (from the patient's hospital bill) by the cost-to-charge ratio, which is the ratio of a department's total costs (as derived from budget expenses) to total charges attributed to that department (from all patients' hospital bills).

In a study of 715 inpatients undergoing either diskectomy, prostatectomy, appendectomy, or laparoscopic cholecystectomy, 3.85% of the total costs for a patient's hospitalization was allocated to the PACU.^[14] However, PACU charges (as appeared on the patient's hospital bill) were 3.2% of the overall hospital charge. The mean cost-to-charge ratio for the PACU is 0.54 ( Table 71-1 ). The differing cost-to-charge ratios are due to hospitals marking up the charges for services in one area (i.e., the PACU) to invest in other unreimbursed hospital departments (i.e., medical records) or to pay for the development of new clinical programs.

Let's assume that the charge as it appears on a patient's hospital bill for a 1-hour PACU stay is $325. Assuming a cost-to-charge ratio of 0.54, the actual total cost to the hospital of caring for a patient in the PACU is $175.50/hr (0.54 × $325). Thirty-three percent of this PACU cost is variable. This suggests that for each hour of reduction in PACU stay, hospital costs may decrease by $57.92 (0.33 × $175.50), which is the variable cost to the hospital for running the PACU. This cost contrasts with fixed costs (e.g., for medical records support), which are independent of the duration of PACU stay.

The PACU has a high fixed cost component (cost does not change in proportion to the number of patients treated). This fixed cost component dictates whether a cost-reducing intervention (e.g., reducing the length of time that patients stay in the PACU) is likely to decrease hospital costs.

Cost-reducing interventions such as changes in medical practice patterns (e.g., to reduce PACU length of stay) have an impact only on variable costs.

2705

Appropriate strategies to increase PACU nursing productivity—fewer nurses care for more patients without working more hours—depend on how PACU nurses are paid.^[15] For example, decreases in PACU labor costs resulting from increases in the number of patients who bypass the PACU vary depending on how the staff is compensated.

Hospitals with full-time or part-time hourly employees with no minimum number of hours of work each day can "flex" staff based on the operating room schedule. In contrast, hospitals with salaried or full-time hourly employees with a minimum number of hours of work each day cannot adjust the number of operating room nurses on a day-to-day basis without having staff members "float" to units other than the PACU. As such, centers with higher variable cost/total cost fractions have a larger potential for cost reduction.