Counting what counts : time-driven activity-based costing in health care

Abstract

Introduction: Patients with multiple chronic conditions consume over 40% of health care resources. The si- loed nature of the health care system exacerbates these costs, and integrated care solutions are required to adequately meet their needs. However, such integrated multidisciplinary ap- proaches are seen as costly. Therefore, costing care for patients with multiple chronic conditions becomes important to support health care professionals, management, and policy makers understand the true financial impact of integrated multidisciplinary care.

Aim: The aim of this thesis is to explore how Time-Driven Activity-Based Costing (TDABC) can be applied to capture and compare the cost of integrated multidisciplinary versus traditional siloed care processes for patients with multiple chronic conditions.

Method: This thesis is comprised of four studies. Study I was a systematic review performed according to the PRISMA statement and used qualitative methods to analyze data through content analy- sis. Studies II to IV were based on a randomized controlled trial CareHND (NCT03362983). Study II used descriptive statistics to describe patient diagnostic data, Charlson Comorbidity Index scores, and performed a comparison of care utilization patterns between integrated mul- tidisciplinary care and traditional care. Study III adopted a mixed-methods approach to perform a TDABC analysis of integrated multidisciplinary care. Study IV expanded on Study III to compare the costs of integrated multidisciplinary care to that of traditional siloed care.

Findings: Study I found that TDABC is an efficient and accurate tool for costing processes in health care, but has not been demonstrated to effectively cost care across the care continuum. Study II found that patients with multiple chronic conditions experience care that is characterized by high vol- ume and high variation, and no difference in care utilization was detected when comparing integrated multidisciplinary care to traditional siloed care. The TDABC cost analysis in Study III successfully estimated the outpatient care costs for patients with multiple chronic conditions. Study IV found that the integrated multidisciplinary care center saved a hospital an av- erage of 5,098.00 € per patient per year.

Discussion: This thesis demonstrates how TDABC can be applied to capture and compare costs of pro- cesses for patients with multiple chronic conditions. More broadly, this thesis demonstrates how to conceptualize and evaluate real-world care pathways for patients with multiple chronic conditions in order inform actionable changes to clinical management within hospitals. This thesis lays the groundwork for empowering hospitals and other providers to incorporate finan- cial analyses into their evidence development, quality improvement, and decision making, and to contribute to the wider financial and economic systems in health care.

Conclusion: This thesis demonstrates that a hospital-based integrated multidisciplinary care approach to a complex medical condition makes economic sense for the hospital and the system. The TDABC approach developed in this thesis project brought to light a set of core capacities which can be prioritized in future quality improvement efforts. Through these core capacities, clinical organizations will hopefully become empowered to make wise, value-driven decisions that will serve as the new incentive for organizational improvement. Information that demonstrates value delivery will make financial needs clear to managers and policy makers, who in turn should understand that evidence-based investment in care facilities and services will ultimately demonstrate a return, benefiting not only IMD-Care patients, but also the larger populations they serve.