Assessing the Financial Impact of an Inpatient Acute Palliative Care Unit in a Tertiary Care Teaching Hospital

Abstract

Evidence suggests palliative care consult services yield cost improvements; few studies have examined the impact of an inpatient palliative care unit on hospital costs. This study estimates the cost avoidance of a single hospital's acute palliative care unit (APCU), building upon previous studies (1) by limiting pre-APCU costs to two days pre-APCU transfer, thereby minimizing bias from higher-cost first days of admission, and (2) by not limiting the study to cancer patients or patients who died, thereby presenting more comprehensive APCU costs. This retrospective study compares direct costs of care on an APCU with costs pre-APCU transfer from general medical units, intensive care units (ICU), and the emergency department (ED), and compares the direct costs of APCU patients with those of control patients. The data were entered into an SPSS(®) 17.0 (SPSS Inc., Chicago, IL) statistical software database. Paired and independent samples t-tests were conducted to test cost differences. Study patients were admitted or transferred to the APCU from October 2008 through January 2009. Control patients were inpatients during the same time period and met several matching criteria. The hospital's finance department provided direct costs, case mix index (CMI), and geometric mean length of stay, and the Department of Quality and Resource Management provided patients' demographic and administrative data. Of 209 patients transferred to the APCU, 50% transferred from a medical unit, 32% from an ICU, and 18% from the ED. Annualized, the total cost avoidance realized by transfers to the APCU was $848,556, over half of which came from ICU to APCU transfers. Cost avoidance is realized when patients transfer to an APCU even when conservative pre-APCU cost measures are used and when patients with varying diagnoses and discharge outcomes are included. This study demonstrates a replicable methodology for estimating the financial impact of an APCU.