Pediatric neurosurgery through the lens of time-driven activity-based costing: a pilot study

Kiana Y. Prather Division of Pediatric Neurosurgery, Oklahoma Children’s Hospital, Department of Neurosurgery, University of Oklahoma Health Sciences Center, Oklahoma City, Oklahoma

Search for other papers by Kiana Y. Prather in
jns
Google Scholar
PubMed
Close
 BS
,
Burak Ozaydin Division of Pediatric Neurosurgery, Oklahoma Children’s Hospital, Department of Neurosurgery, University of Oklahoma Health Sciences Center, Oklahoma City, Oklahoma

Search for other papers by Burak Ozaydin in
jns
Google Scholar
PubMed
Close
 MD
,
Mikayla Peters Division of Pediatric Neurosurgery, Oklahoma Children’s Hospital, Department of Neurosurgery, University of Oklahoma Health Sciences Center, Oklahoma City, Oklahoma

Search for other papers by Mikayla Peters in
jns
Google Scholar
PubMed
Close
 MS
,
Emily Tally Division of Pediatric Neurosurgery, Oklahoma Children’s Hospital, Department of Neurosurgery, University of Oklahoma Health Sciences Center, Oklahoma City, Oklahoma

Search for other papers by Emily Tally in
jns
Google Scholar
PubMed
Close
 MHA
,
Kristin Zieles Division of Pediatric Neurosurgery, Oklahoma Children’s Hospital, Department of Neurosurgery, University of Oklahoma Health Sciences Center, Oklahoma City, Oklahoma

Search for other papers by Kristin Zieles in
jns
Google Scholar
PubMed
Close
 MBA
,
Michael E. Omini Division of Pediatric Neurosurgery, Oklahoma Children’s Hospital, Department of Neurosurgery, University of Oklahoma Health Sciences Center, Oklahoma City, Oklahoma

Search for other papers by Michael E. Omini in
jns
Google Scholar
PubMed
Close
 MS
,
Joanna E. Gernsback Division of Pediatric Neurosurgery, Oklahoma Children’s Hospital, Department of Neurosurgery, University of Oklahoma Health Sciences Center, Oklahoma City, Oklahoma

Search for other papers by Joanna E. Gernsback in
jns
Google Scholar
PubMed
Close
 MD
,
Virendra R. Desai Division of Pediatric Neurosurgery, Oklahoma Children’s Hospital, Department of Neurosurgery, University of Oklahoma Health Sciences Center, Oklahoma City, Oklahoma

Search for other papers by Virendra R. Desai in
jns
Google Scholar
PubMed
Close
 MD
,
Karl E. Balsara Division of Pediatric Neurosurgery, Oklahoma Children’s Hospital, Department of Neurosurgery, University of Oklahoma Health Sciences Center, Oklahoma City, Oklahoma

Search for other papers by Karl E. Balsara in
jns
Google Scholar
PubMed
Close
 MD
, and
Andrew Jea Division of Pediatric Neurosurgery, Oklahoma Children’s Hospital, Department of Neurosurgery, University of Oklahoma Health Sciences Center, Oklahoma City, Oklahoma

Search for other papers by Andrew Jea in
jns
Google Scholar
PubMed
Close
 MD, MBA, MHA
Restricted access

Purchase Now

USD  $45.00

JNS + Pediatrics - 1 year subscription bundle (Individuals Only)

USD  $536.00

JNS + Pediatrics + Spine - 1 year subscription bundle (Individuals Only)

USD  $636.00
USD  $45.00
USD  $536.00
USD  $636.00
Print or Print + Online Sign in

OBJECTIVE

Time-driven activity-based costing (TDABC) is a method used in cost accounting that has gained traction in health economics to identify value optimization initiatives. It measures time, assigns value to time increments spent on a patient, and integrates the cost of material and human resources utilized in each episode of care. In this study, the authors report the first use of TDABC to evaluate costs in a pediatric neurosurgical practice.

METHODS

A clinical pathway was developed with a multifunction team. A time survey among each care team member, including surgeons, medical assistants (MAs), and patient service representatives (PSRs), was carried out prospectively over a 10-week period at a pediatric neurosurgery clinic. Consecutive patient encounters for Chiari malformation (CM), hydrocephalus, or tethered cord syndrome (TCS) were included. Encounters were categorized as new or established. Relative annual personnel costs, using the salary of a PSR as a reference (i.e., 1.0-unit cost), were calculated for all members using departmental financial data after adjustments. The relative capacity cost rates (minute−1) for each personnel, a representation of per capita cost per minute, were then derived, and the relative costs per visit were calculated.

RESULTS

A total of 110 visits (24 new, 86 established) were captured, including 40% CM, 41% hydrocephalus, and 19% TCS encounters. Surgeons had the highest relative capacity cost rate (118.4 × 10−6), more than 10-fold higher than that of an MA or PSR (10.65 × 10−6 and 9.259 × 10−6, respectively). Surgeons also logged more time with patients compared with the rest of the care team in nearly all visits (p ≤ 0.002); consequently, the total visit costs were primarily driven by the surgeon cost (p < 0.0001). Overall, surgeon cost constituted the vast majority of the total visit cost (92%–93%), regardless of whether the visits were new or established. Visit costs did not differ by diagnosis. On average, new visits took longer than established visits (p < 0.001). This difference was largely driven by new CM visits (44.3 ± 13.7 minutes), which were significantly longer than established CM visits (29.8 ± 9.2 minutes; p = 0.001).

CONCLUSIONS

TDABC may reveal opportunities to maximize value by highlighting instances of variability and high cost in each module of care delivery. Physician leaders in pediatric neurosurgery may be able to use this information to allocate costs and streamline value care pathways.

ABBREVIATIONS

AI = artificial intelligence; APP = advanced practice provider; CM = Chiari malformation; MA = medical assistant; PSR = and patient service representative; TCS = tethered cord syndrome; TDABC = time-driven activity-based costing.
  • Collapse
  • Expand
  • 1

    Sethi RK, Drolet CE, Pumpian RP, et al. Combining time-driven activity-based costing and lean methodology: an initial study of single-level lumbar fusion surgery to assess value-based healthcare in patients undergoing spine surgery. J Neurosurg Spine. 2022;37(5):639645.

    • PubMed
    • Search Google Scholar
    • Export Citation
  • 2

    Ali DM, Leibold A, Harrop J, Sharan A, Vaccaro AR, Sivaganesan A. A multi-disciplinary review of time-driven activity-based costing: practical considerations for spine surgery. Global Spine J. 2023;13(3):823839.

    • PubMed
    • Search Google Scholar
    • Export Citation
  • 3

    McLaughlin N, Upadhyaya P, Buxey F, Martin NA. Value-based neurosurgery: measuring and reducing the cost of microvascular decompression surgery. J Neurosurg. 2014;121(3):700708.

    • PubMed
    • Search Google Scholar
    • Export Citation
  • 4

    Kaplan AL, Agarwal N, Setlur NP, et al. Measuring the cost of care in benign prostatic hyperplasia using time-driven activity-based costing (TDABC). Healthc (Amst). 2015;3(1):4348.

    • PubMed
    • Search Google Scholar
    • Export Citation
  • 5

    Kaplan RS, Anderson SR. Time-driven activity-based costing. Harvard Business Review. November 2004. Accessed December 19, 2023. https://hbr.org/2004/11/time-driven-activity-based-costing

    • PubMed
    • Search Google Scholar
    • Export Citation
  • 6

    Porter ME. What is value in health care? N Engl J Med. 2010;363(26):24772481.

  • 7

    Fendrick AM, Martin JJ, Weiss AE. Value-based insurance design: more health at any price. Health Serv Res. 2012;47(1 Pt 2):404413.

  • 8

    Filson CP, Hollingsworth JM, Skolarus TA, Clemens JQ, Hollenbeck BK. Health care reform in 2010: transforming the delivery system to improve quality of care. World J Urol. 2011;29(1):8590.

    • PubMed
    • Search Google Scholar
    • Export Citation
  • 9

    Demeere N, Stouthuysen K, Roodhooft F. Time-driven activity-based costing in an outpatient clinic environment: development, relevance and managerial impact. Health Policy. 2009;92(2-3):296304.

    • PubMed
    • Search Google Scholar
    • Export Citation
  • 10

    Au J, Rudmik L. Cost of outpatient endoscopic sinus surgery from the perspective of the Canadian government: a time-driven activity-based costing approach. Int Forum Allergy Rhinol. 2013;3(9):748754.

    • PubMed
    • Search Google Scholar
    • Export Citation
  • 11

    Inverso G, Lappi MD, Flath-Sporn SJ, Heald R, Kim DC, Meara JG. Increasing value in plagiocephaly care: a time-driven activity-based costing pilot study. Ann Plast Surg. 2015;74(6):672676.

    • PubMed
    • Search Google Scholar
    • Export Citation
  • 12

    Lee CI, Enzmann DR. Measuring radiology’s value in time saved. J Am Coll Radiol. 2012;9(10):713717.

  • 13

    Öker F, Özyapıcı H. A new costing model in hospital management: time-driven activity-based costing system. Health Care Manag (Frederick). 2013;32(1):2336.

    • PubMed
    • Search Google Scholar
    • Export Citation
  • 14

    Ziemann M, Erikson C, Krips M. The use of medical scribes in primary care settings: a literature synthesis. Med Care. 2021;59(suppl 5):S449-S456.

  • 15

    Gidwani R, Nguyen C, Kofoed A, et al. Impact of scribes on physician satisfaction, patient satisfaction, and charting efficiency: a randomized controlled trial. Ann Fam Med. 2017;15(5):427433.

    • PubMed
    • Search Google Scholar
    • Export Citation
  • 16

    Abraham CM, Norful AA, Stone PW, Poghosyan L. Cost-effectiveness of advanced practice nurses compared to physician-led care for chronic diseases: a systematic review. Nurs Econ. 2019;37(6):293305.

    • PubMed
    • Search Google Scholar
    • Export Citation
  • 17

    Birkmeyer JD, Sharp SM, Finlayson SR, Fisher ES, Wennberg JE. Variation profiles of common surgical procedures. Surgery. 1998;124(5):917923.

  • 18

    Wennberg J, Gittelsohn. Small area variations in health care delivery. Science. 1973;182(4117):11021108.

  • 19

    Russell LB. Completing costs: patients’ time. Med Care. 2009;47(7 suppl 1):S89S93.

Metrics

All Time Past Year Past 30 Days
Abstract Views 269 269 269
Full Text Views 35 35 35
PDF Downloads 36 36 36
EPUB Downloads 0 0 0