Can We Estimate Total Episode Costs for Surgical Spine Patients Using TDABC?

Introduction: Time-driven activity-based costing (TDABC) measures dollars required to provide every component in a healthcare episode, as a function of time. With the advent of bundled payment models, it is important to understand exactly how much it costs to deliver care. This study uses TDABC to understand the true costs of surgical episodes for cervical myelopathy. This is the first attempt at estimating total episode costs in spine surgery, from outpatient through inpatient, via TDABC.

Methods: In a single-center retrospective study at a large tertiary academic institution, TDABC was employed to measure pre- and post-operative personnel costs (including providers, nursing, therapy, and administrative staff) and total intra-operative costs, in US dollars, of the care episodes of 63 patients who underwent elective spine surgery for cervical myelopathy. Cost patterns among different surgical approaches (anterior, posterior, anterior/posterior) were analyzed using a one-way analysis of variance.

Results: There was no significant difference between total pre-operative costs between any of the approaches. The total anterior intra-operative cost was significantly cheaper than the posterior approach (mean difference -$6,410.80; 95% CI = -$9,147.04:-$3,674.57; p < 0.01) and the anterior/posterior approach (mean difference -$14,685.62; 95% CI = -$19,331.61:-$10,039.63; p < 0.01). The total posterior intra-operative cost was significantly cheaper than the anterior/posterior approach (mean difference -$8,274.82; 95% CI = -$12,762.62=-$3,787.01; p < 0.01). This trend continued between total post-operative personnel costs between anterior and posterior approaches (mean difference -$4,136.90; 95% CI = -$7,256.64:-$1,017.15; p = 0.06). Total episode costs were cheaper for anterior compared to posterior approaches (mean difference -$10,434.99; 95% CI = -$14,200.11:-$6,778.78, p < 0.001) and anterior/posterior (mean difference -$17,048.38; 95% CI = -$23,441.37:-$10,655.39, p < 0.001). The total posterior episode cost was also cheaper than anterior/posterior (mean difference -$6,613.39; 95% CI = -$12,788.71:-$438.06; p = 0.033).

Conclusion : This data describes cost differences between spine surgical approaches in dollar values based on time. Anterior approaches were significantly cheaper compared to posterior in terms of total cost and neurosurgery, nursing, and therapist personnel. This is the first study to apply TDABC for precise costing of complete spine surgery episodes. Our methodology may be critical for future bundled payment models.