Dive Brief:
- Several years ago, Dr. Vivian Lee at the University of Utah Health Care started a query about the costs of hospital goods and services that are saving money and improving care.
- Special software tracks costs for items ranging from drugs to a doctor's time in the operating room and outcomes, such as days in the hospital and readmissions.
- The University's costs have declined 0.5% annually, versus costs at other academic medical centers nearby which have increased 2.9% over the past few years.
Dive Insight:
Armed with information on the cost of labor, supplies and labs, the hospital has cut costs and revised practices for more efficient and effective care. While the software is still a work in progress, it includes robust features. For example, it contains a menu that compares each doctor's costs and outcomes with others' in the department. Calculated costs include emergency room cost per minute (82 cents), surgical intensive care per minute ($1.43) and operating room per minute for orthopedic surgery ($12).
Other medical centers are trying to calculate costs in light of the Affordable Care Act's focus on value-based care, including the Mayo Clinic and MD Anderson. The program's success is attracting attention. Sylvia Matthews Burwell, HHS secretary, visited the University of Utah Health Center last month to see their results. An economist and professor at Harvard, Michael Porter, called the results "epic progress."