The Return on Investment of Implementing a Continuous Monitoring System in General Medical-Surgical Units*

Abstract

To evaluate the cost savings attributable to the implementation of a continuous monitoring system in a medical-surgical unit and to determine the return on investment associated with its implementation. Return on investment analysis. A 316-bed community hospital. Medicine, surgery, or trauma patients admitted or transferred to a 33-bed medical-surgical unit. Each bed was equipped with a monitoring unit, with data collected and compared in a 9-month preimplementation period to a 9-month postimplementation period. Two models were constructed: a base case model (A) in which we estimated the total cost savings of intervention effects and a conservative model (B) in which we only included the direct variable cost component for the final day of length of stay and treatment of pressure ulcers. In the 5-year return on investment model, the monitoring system saved between $3,268,000 (conservative model B) and $9,089,000 (base model A), given an 80% prospective reimbursement rate. A net benefit of between $2,687,000 ($658,000 annualized) and $8,508,000 ($2,085,000 annualized) was reported, with the hospital breaking even on the investment after 0.5 and 0.75 of a year, respectively. The average net benefit of implementing the system ranged from $224 per patient (model B) to $710 per patient (model A) per year. A multiway sensitivity analyses was performed using the most and least favorable conditions for all variables. In the case of the most favorable conditions, the analysis yielded a net benefit of $3,823,000 (model B) and $10,599,000 (model A), and for the least favorable conditions, a net benefit of $715,000 (model B) and $3,386,000 (model A). The return on investment for the sensitivity analysis ranged from 127.1% (25.4% annualized) (model B) to 601.7% (120.3% annualized) (model A) for the least favorable conditions and from 627.5% (125.5% annualized) (model B) to 1739.7% (347.9% annualized) (model A) for the most favorable conditions. Implementation of this monitoring system was associated with a highly positive return on investment. The magnitude and timing of these expected gains to the investment costs may justify the accelerated adoption of this system across remaining inpatient non-ICU wards of the community hospital.