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Cardiology Economics 101: An Ongoing Education

January 28, 2011
by Joe Marion
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If one had the luxury of designing hybrid cath/surgical procedures from the bottom up, perhaps there would be fewer systems and staff required

Last August I blogged on the opportunity for the hybrid room in cardiology (Cardiology’s Hybrid … and I don’t mean the Chevy Volt!). My emphasis then was on the technology of managing a procedure room that combines cardiac catheterization procedures with surgical procedures, and why the hybrid room approach makes sense.

This week I gained additional insight into the economics of the hybrid room, and the factors affecting its adoption while discussing it with a client of mine. The interesting thing is the logic going on at what I suppose are many institutions looking to implement the technology, particularly the economics of it.

I learned more about why facilities are interested in the hybrid room. One such interest I learned about this week involves the application for Percutaneous Valve Replacement procedures such as the Transcatheter Aortic Valve Implantation, or TAVI. In this procedure, a compressed valve replacement is delivered via a catheter and inflated into position over the defective valve. It is a promising alternative to surgical procedures for patients that might not be candidates for surgical alternatives.

Clearly this is an interesting blend of cardiac catheterization and surgical procedures. My prior thinking was based on another facility’s concerns with easily shifting from a cath procedure to a surgical one, such as in the case where angioplasty is tried and ruled out in favor of a graft procedure. The TAVI procedure more or less requires the hybrid room, since it is a combination of cath and surgical procedures.

From the research done by my client, the original economics of justifying such a room was predicated on the cost tradeoff between the higher cost of the implantable valve, versus the increased length of stay for more invasive surgical implantation. This sounded plausible until further analysis suggested that in reality the difference in length of stay is not differential enough to make up the valve cost difference. The volume of exams is also a crucial factor in determining the economics. What is interesting is that one site studied by my client concluded that the economics were more about the “trickle-down” effect that having such a room had on the ability to pull in additional heart and vascular business! In other words, it takes money to make money!

While I understand these economics, my informatics mindset wants to address the other side of the equation as well. As relayed to me, the observation of one of these TAVI procedures involved at least sixteen people in the exam room! This included the surgical team, the valve prep team, the anesthesiologist team, not to mention the nurses, and radiological technologists. As in my prior hybrid room discussion, my concern is that these procedures are being assembled from separate surgical and cardiology system and staffing perspectives. For example, separate systems and staff are required to monitor the cardiac cath versus the surgical portion of the procedure.

If one had the luxury of designing these procedures and systems from the bottom up, perhaps there would be fewer systems and staff required. In such a case one might be able to dramatically impact the cost of such a procedure, thereby shifting the economics to a more favorable position. It reminds me of the early days of CT when everyone was worried about the higher cost of a CT scanner and how could it be justified based on the higher procedure cost. That is until CT took hold and demonstrated that a CT scan oftentimes eliminated the need to do other procedures initially, thereby lowering the total diagnostic cost.

In the case of hybrid cath/surgical procedures, perhaps with enough forethought it can be demonstrated that the overall cost can be lowered; thereby building sufficient volume to justify the procedure’s cost. I look forward to the next round of economics debate!

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Joe Marion

Founder and Principal, Healthcare Integration Strategies

Joe Marion

www.hisconsultant.com

Joe Marion is founder and Principal of Healthcare Integration Strategies, specializing in the...