

Is cancer surgery less costly at high volume hospitals?


As the cost of treating cancer in the United States continues to rise — colon cancer surgery alone accounts for more than $1 billion in Medicare costs each year — Vivian Ho, Baker Institute Chair in Health Economics, and Thomas Aloia, a surgeon at The Methodist Hospital, are researching the factors that lead to higher costs, and how best to control them.

In 2008, the investigators determined that surgeons who perform more of certain types of cancer surgeries each year have lower hospital costs per patient; however, they found that hospitals that perform more of the operations do not experience lower average costs.

With a three-year, $815,000 grant from the National Cancer Institute, Ho and Aloia now seek to understand this counterintuitive phenomenon. They are examining multiple data sources to determine the cost determinants of six complex cancer operations commonly performed on patients with colorectal, lung, esophageal and pancreatic cancer.

Ho hypothesizes that “high volume” hospitals provide higher quality care and lower costs due to fewer surgery-related complications, but that these cost savings are hidden by the investments that hospitals must make to provide superior care, such as better-equipped intensive care units and more advanced patient monitoring.

The results of Ho’s research could have important implications for identifying cost-effective approaches to providing cancer surgery.

“Our analyses will shed light on whether referring patients to high-volume providers, lowering Medicare reimbursement rates to discourage low-volume providers or disseminating best practices among providers will restrain cost growth and improve the quality of patient care,” Ho said.

Health Policy