Time-Driven Activity-Based Costing Analysis Identifies Use of Consumables and Operating Room Time as Factors Associated With Increased Cost of Outpatient Primary Hip Arthroscopic Labral Repair

Abstract

Purpose: To use time-driven, activity-based costing (TDABC) methodology to investigate drivers of cost variation and to elucidate preoperative and intraoperative factors associated with increased cost of outpatient arthroscopic hip labral repair.

Methods: A retrospective analysis of data from January 2020 to October 2021 was performed. Patients undergoing primary hip arthroscopy for labral repair in the outpatient setting were included. Indexed TDABC data from Avant-garde Health's analytics platform were used to represent cost-of-care breakdowns. Patients in the top decile of cost were defined as high cost, and cost category variance was determined as a percent increase between high and low cost. Analyses tested for associations between preoperative and perioperative factors with total cost. Surgical procedures performed concomitantly to labral repair were included in subanalyses.

Results: Data from 151 patients were analyzed. Consumables made up 61% of total outpatient cost with surgical personnel costs (30%) being the second largest category. The average total cost was 19% higher for patients in the top decile of cost compared to the remainder of the cohort. Factors contributing to this difference were implants (36% higher), surgical personnel (20% higher), and operating room (OR) consumables (15% higher). Multivariate linear regression modeling indicated that OR time (Standardized β = 0.504; P < .001) and anchor quantity (standardized β = 0.443; P < .001) were significant predictors of increased cost. Femoroplasty (Unstandardized β = 15.274; P = .010), chondroplasty (Unstandardized β = 8.860; P = .009), excision of os acetabuli (unstandardized β = 13.619; P = .041), and trochanteric bursectomy (Unstandardized β = 21.176; P = .009) were also all independently associated with increasing operating time.

Conclusions: TDABC analysis showed that OR consumables and implants were the largest drivers of cost for the procedure. OR time was also shown to be a significant predictor of increased costs.

Level of evidence: Level IV, economic analysis.