Implementation and financial analysis of an operating room satellite pharmacy.

The rationale and implementation of an operating room (OR) pharmacy satellite is described, and the first-year savings are evaluated. The OR in an 874-bed university teaching hospital, consisting of 17 rooms for inpatients, 6 rooms for ambulatory patients, and a postanesthesia care unit, lacked comprehensive pharmacy services; this resulted in poor drug-use control and accountability, varied controlled-substance audit trails, and suboptimal patient services. A task force examined other institutions' OR pharmacy satellites and chose to implement a satellite that provides all pharmaceuticals and i.v. admixtures by using case trays for each surgical patient. One year after implementation of the satellite, inventory in the operating-room areas was reduced by 56.5%, annual pharmaceutical costs by 2.6% (adjusted for inflation), and average cost per patient by 8.0% (adjusted for inflation). First-year cost reductions and revenue identification exceeded operating costs for materials, supplies, and labor by $271,755. Implementation of an OR pharmacy satellite reduced the net cost of providing pharmaceutical services to the OR.     

Time and cost requirements for decentralized pharmacist activities

Time and cost requirements for pharmaceutical services in patient-care areas at a 548-bed university hospital were studied. The study was conducted in 1987 and 1988 to (1) define the clinical and distributive activities of decentralized pharmacists, (2) develop time standards for each activity, (3) determine whether the time requirements of decentralized pharmacists depend on the type of patient involved, (4) determine the actual costs of decentralized pharmacist services for various types of patient, and (5) compare costs with reimbursement for clinical pharmacy services. Time standards were established based on data from seven patient categories representing a cross section of the institution's patients. The mean frequency of each activity and the total time and cost per patient day for all activities were determined. Pharmacist time spent daily in each patient-service category ranged from 2.3 hr for low-intensity medical care to 20.8 hr for trauma-burn intensive care. Decentralized pharmacists spent approximately 50% of their time on clinical activities in all patient-service categories. The daily cost per patient day for clinical activities was lowest for low-intensity medical care and highest for adult intensive care. The institution's daily charge for clinical activities ($10/admission and $10/day) exceeded the cost of clinical services during the study period. The decentralized pharmacist time requirement per patient day, and thus the costs of delivering pharmaceutical services, varied by patient-service category. The provision of clinical services generated a profit. A pharmacy workload analysis system that can identify costs and correlate them with patient types can be valuable in hospital pharmacy management.     

Pharmacoeconomic impact of critically ill surgical patients

Financial information on 131 patients and drug-related information on 176 patients admitted to a surgical intensive care unit (ICU) were prospectively collected. The average stay was nearly five days and patients received 8.6 drugs per day for a total average exposure of 12.2 different drugs. Antibiotics and analgesics were used in over 90 percent of patients. The patients' diagnoses fit into 53 different diagnosis-related groups (DRG). Hospital costs were significantly greater than DRG payment for an average revenue loss of $17,803 per patient. Patients with a primary diagnosis of sepsis had the largest revenue loss, averaging $54,738. One hundred patients were revenue losers. Total hospital stay was statistically longer than DRG-projected length of stay. Pharmacy charges averaged 13.6 percent of total hospital charges. Patients receiving systemic antifungals, triple antibiotics, catecholamines, and total parenteral nutrition had high hospital and pharmacy costs. This study suggests that ICU patients are costly to hospitals and that drug use is expensive. We suggest that increased pharmacy involvement in the care of ICU patients may help curtail escalating drug costs in these patients.     

Clinical guidelines and pharmacist intervention program for HIV-infected patients requiring granulocyte colony-stimulating factor therapy

Guidelines, implemented by clinical pharmacists, were developed by the pharmacy and therapeutics subcommittee on a dedicated service caring for hospitalized patients with human immunodeficiency virus infection or the acquired immunodeficiency syndrome (AIDS) who required granulocyte colony-stimulating factor (G-CSF) therapy. Drug use and evaluation was conducted on all patients with AIDS who were prescribed G-CSF, and education was provided to medical house staff. Clinical data from chart review and laboratory and billing data bases of the hospital medical information system were compared for the 9-month intervention period (IP) with data from the 9-month preintervention period (PIP). Comparing the IP and PIP, the mean number of G-CSF doses (0.29 vs 0.51) and pharmacy costs per day ($112 vs $200) decreased, with no change in the number of patients requiring G-CSF. The 1.3 pharmacist interventions per patient resulted in a decrease to 2.4 doses per admission from a baseline of 5.9 (p<0.0001). Mean hospital stay (11.9 vs 13.8 days) and mean number of days of neutropenia did not differ for IP and PIP groups. Effectively implemented pharmacist-based interventions can decrease hospital costs without increasing patient morbidity.     

Using serum creatinine concentrations to screen for inappropriate dosage of renally eliminated drugs

The impact on drug therapy and costs of a program to identify and correct unadjusted dosage in renally impaired patients is described. The program was instituted in May 1988 by the clinical pharmacy staff at a 272-bed hospital. Each day the clinical pharmacist uses laboratory data to list patients with serum creatinine concentrations greater than 1.5 mg/dL. The pharmacist screens the pharmacy profiles of listed patients and calculates creatinine clearance for patients receiving renally eliminated drugs. If, after reviewing the patient's medical record, the pharmacist judges that a dosage adjustment may be appropriate, he writes a confidential note to the physician. From May 1988 through June 1989, 2341 patients with elevated serum creatinine were monitored. During that period, 162 notes were left; recommendations from 142 (88%) of the notes were accepted by physicians. Most of the notes were written for patients receiving antimicrobials or histamine H2-receptor antagonists. The program, which requires 20-30 minutes of pharmacist time per day, avoided $5003 in drug acquisition costs and cost $2700 to administer during the one-year period. When the costs associated with drug preparation and administration are considered, net cost avoidance was $5040. An intervention program in which notes to physicians are written when patients with abnormal serum creatinine values are receiving drugs for which a dosage adjustment appears indicated (1) has medical staff acceptance, (2) helps to satisfy standards of the Joint Commission on Accreditation of Healthcare Organizations, and (3) saves money.     

Costs of training drug-administration technicians

The costs associated with training drug-administration pharmacy technicians in a 1000-bed university teaching hospital were determined. Data were collected between January 1 and December 31, 1983, for the personnel acquisition phase and four training phases of the technician training program. The study phases were further divided into direct and indirect costs. The pharmacy department interviewed 56 applicants for the training program, of which 19 were accepted; 15 of the 19 (79%) trainees successfully completed the program and were hired. Four nine-week training sessions were conducted. The cost per training hour was $15.69, the cost per trainee was $5,683, and the total training cost of the program was $85,245. Although these cost data are specific to this hospital, they may assist other hospitals in the financial management of pharmacy technician training programs.     

Justification of an operating-room satellite pharmacy

The pharmacy department's documentation of medication handling and control in a 24-suite operating room (OR) complex to justify implementation of an OR pharmacy satellite is described. At a 937-bed hospital, medication inventory, charge capture, and procedures for handling controlled substances were assessed to justify an OR pharmacy both financially and in terms of patient safety. Actual medication charges to patients using the OR billing system were compared with theoretical pharmacy charges based on medication administration records; results indicated that an OR pharmacy would increase gross revenue by $671,606 annually. New collectible revenue from increased charge capture was projected to be $71,926, considering payer mix, reimbursement rates, and current payment methods. The cost of medication inventory in the OR complex was $75,576; a $55,000 inventory reduction and $50,000 annual decrease in drug wastage was projected. First-year personnel costs associated with an OR pharmacy were estimated at $79,872 and equipment and renovation costs at $5,000. New collectible revenue to the institution, after expenses, was projected at $79,959 from the first year of operation and $277,569 after five years. Controlled-substance documentation was incomplete; 19% of fentanyl and 31% of sufentanil removed from inventory were not recorded as administered, returned, or wasted. The results indicated that, at this institution, approximately three OR complex full-time equivalents could be relieved from medication-related activities. Based on the potential for improved patient safety and new revenue generation, implementation of an OR satellite pharmacy was recommended to the hospital administration.     

Comparative analysis of drug distribution costs for controlled versus noncontrolled oral analgesics

Total costs for controlled substance oral analgesics and non-controlled analgesics were compared for patients at a 548-bed university hospital. During 1983, all cost elements involved in drug delivery (excluding large-volume parenterals) were identified. Direct and indirect pharmacy labor costs were determined. Personnel costs were calculated from time studies of nurses (in 1979-80) and pharmacy technicians (in 1982). Other pharmacy costs, based on the hospital's 1982 data, included inventory holding costs, computer services, supplies, and drug acquisition costs. Costs were calculated for four oral analgesics--acetaminophen with codeine, aspirin with codeine, ibuprofen, and zomepirac sodium--used during a 30-day period in 1981. For all medications, total average cost per dose for 1,949,418 doses was $2.44, of which 41% was drug acquisition cost. Personnel costs for pharmacy and nursing accounted for 43% and 11%, respectively, of total costs. For 46% of 5111 oral analgesic doses, frequency of administration was at least four times daily. Average purchase cost per dose for the oral analgesics was $0.15, while total costs for the controlled and non-controlled drugs were $1.02 and $0.50, respectively. For the four oral analgesics in this study, cost was affected by dosage schedule and controlled or noncontrolled status. Calculation of the total average cost per dose is useful in projecting annual costs and in identifying areas for cost reduction.     

Pharmaceutical services in an extracorporeal shock wave lithotripsy center

Satellite pharmacy services in a hospital's extracorporeal shock wave lithotripsy (ESWL) center are described. At an 833-bed hospital, an ESWL center was opened in 1985. The existing surgical pharmacy satellite provided pharmaceutical services to the ESWL center with no addition of pharmacy staff. Drug boxes for the ESWL procedure were prepared, and the ESWL area was provided with a limited stock of infusion and irrigation fluids, drugs, and supplies. After each ESWL procedure, the box was checked for patient charges and restocked. Charge slips for floor-stock items were also placed in the box. The initial pharmacy cost to supply the ESWL unit was $500. The satellite pharmacist provides distributive functions, drug information, and quality assurance. Estimated annual pharmacy revenue from the ESWL is $239,240. Pharmacists' new role in the ESWL was beneficial to the pharmacy department and to the hospital.     

Economic consequences of two drug-use control systems in a teaching hospital

Length of stay (LOS), total cost per admission (TCA), and pharmacy cost per admission (DCA) were determined for two drug-use control systems in a 1058-bed university hospital; a centralized unit dose drug distribution system served as a control. The two study systems were (1) pharmacist monitoring of drug therapy in the patient-care area and (2) centralized pharmacist monitoring of computerized patient profiles. LOS data were collected retrospectively for 659 patients admitted during a seven-month control interval. LOS, TCA, and DCA data were collected prospectively for 496 patients admitted during a five-month experimental interval. Each study system was assigned to one of three teams making rounds among intact patient groups. LOS differences were compared between intervals and by month. After corrections were made for differences in patient mix, the drug-use control system in which pharmacists were assigned to the patient-care area yielded a 1.5-day-shorter average LOS, $1293 lower average TCA (p less than 0.05), and $155 lower average DCA than under the unit dose system. The drug-use control system in which pharmacists were assigned to monitor patients' drug therapy from a central location was associated with a 0.13-day-shorter average LOS, $235 lower average TCA, and $55.13 lower average DCA than under the unit dose system. No systematic differences between teams, other than drug-use control system, appeared to explain the differences in LOS, TCA, and DCA. A drug-use control system based in a patient-care area, overseen by clinically experienced pharmacists, may result in shorter LOSs and lower total costs than centralized systems for general-medical inpatients of teaching hospitals.     

Azithromycin versus erythromycin for community-acquired pneumonia: a cost-minimization analysis.

The costs of i.v. erythromycin versus azithromycin (in terms of medication use and treatment of adverse effects) when these drugs were used with other antimicrobials to treat community-acquired pneumonia (CAP) were compared. The medical records of patients receiving i.v. azithromycin or erythromycin as part of combination antimicrobial therapy for the treatment of CAP at a 473-bed level 1 trauma center in Kentucky were retrospectively reviewed. Data were collected for patients treated from December 1, 1997, through March 31, 1998. Patient data collected included occurrence of phlebitis or pain at the injection site, number of line changes due to phlebitis, and culture results. Cost data collected included drug acquisition cost, pharmacy cost of drug preparation, nursing time to administer the agent, cost of drug supplies, and cost of managing complications. Three time-and-motion studies were conducted to determine technician preparation time and pharmacist verification time. The medical records of 62 patients were identified and reviewed; 50 patients were enrolled in the study (25 in the azithromycin group and 25 in the erythromycin group). The average total days of therapy was 5.1 for the azithromycin group and 5.6 for the erythromycin group. The average total cost, including the cost of complications ($4.36 per patient in the erythromycin group), was $66.46 in the azithromycin group and $96.56 in the erythromycin group. The difference in costs between the two groups was not significant. There was no significant cost difference between azithromycin- and erythromycin-containing combination antimicrobial therapy in the treatment of CAP.     

Microcost analysis of inpatient dispensing and administration of oral solids

The labor cost of dispensing, administering, and monitoring unit dose oral solid dosage forms (UDs) in a large teaching hospital was determined by microcost analysis. The costs associated with UDs dispensed by the midnight central pharmacy and by a satellite pharmacy were evaluated by use of both work-sampling and time-and-motion studies. Pharmacy personnel activities were classified as direct, auxiliary, or nonproductive. A nursing productivity index was used to determine the nursing time consumed in the administration and monitoring of UDs. The pharmacy labor cost was lowest ($0.14 each) for UDs dispensed from the central pharmacy in the 24-hour medication cart. For each UD that was not dispensed in the 24-hour cart, the labor cost was $0.25 for the central pharmacy and $1.37 for the satellite pharmacy. It took nurses 223.8 sec to administer and monitor a scheduled UD, for a cost of $0.82. The total nursing time spent per nonscheduled UD for administration and monitoring was 574.2 sec; the cost was $2.11. Microcost analysis can be used to isolate the costs of dispensing oral solids in an inpatient setting.     

Effect of pharmacist participation on a medical team on costs, charges, and length of stay

The financial impact of pharmacist participation on a medical team in a tertiary-care teaching hospital was studied prospectively. Two medical teams, one with and one without a pharmacist, operated simultaneously for 11 months. Physicians and a pharmacist on the teams rotated monthly during the first five months of the study. Subsequently, the hospital administrator, who was unaware that the controlled study was under way, permanently assigned an attending physician to the team that did ot have a pharmacist. After patients' discharge, pharmacy costs, pharmacy charges, hospital charges, and length of stay (LOS) were compared for the two teams. Data analysis was separated into four phases: phase 1, during which attending physicians rotated monthly; phase 2, with a permanent attending physician; phase 3, which encompassed the entire 11 months; and phase 4, which encompassed the 11-month period but omitted patients whose LOS exceeded 30 days. Data were analyzed for a total of 619 patients on the two teams. In phase 1, the team with a pharmacist had significantly lower per-patient pharmacy costs, pharmacy charges, hospital charges, and LOS. In phase 2, no significant differences were found between the teams. In phase 3, the only significant difference was that the team with a pharmacist had lower pharmacy costs and pharmacy charges. In phase 4, the team that included a pharmacist had significantly lower pharmacy costs ($105 difference), pharmacy charges ($368 difference), hospital charges ($2065 difference), and LOS (1.3-day difference). Participation of pharmacists on the medical team can significantly reduce pharmacy costs and charges, hospital charges, and LOS.     

Charging for hospital pharmaceutical services: combined product-service per diem fees.

The development of a per diem hospital pharmacy charge is reviewed after five years of use. The itemized pharmacy charges for every tenth patient (total of 250 patients) admitted to the hospital during a three-month period were studied to determine the average daily charges for drugs and pharmaceutical services. Six categories of rates were designated, based on the type of hospital service. A comparison of the actual charges and the projected per diem rate indicated that the per diem rate would produce the same revenue as the itemized charging method. A procedure for periodically monitoring the per diem rate was also established. The per diem pharmacy charges range from $3.50 (for patients admitted to the psychiatric service) to $12 (surgical patients). Intravenous solutions, i.v. admixtures, normal human serum albumin, drugs administered in the intensive care and cardiac care units, and drug with an acquistion cost of more than $10 are not included in the per diem charging system. The per diem system enabled the hospital to reduce administrative and accounting costs while continuing to provide quality pharmaceutical services.     

Analyzing pharmacy charges using DRGs

Pharmacy charges at a 316-bed community hospital were analyzed using diagnosis-related groups (DRGs). All patients admitted to the hospital between January 1, 1983, and August 31, 1983, were retrospectively categorized by DRG. For the 20 most expensive DRGs for the pharmacy department in terms of pharmacy charges, the following data were compiled: number of patients, total pharmacy charges, mean hospital and pharmacy charges per patient, mean length of stay, pharmacy charges as a percentage of hospital charges, and DRG distribution and total pharmacy charges by major diagnostic category ( MDC ). A total of 10,550 patients were assigned to 390 DRGs. For the 20 most expensive DRGs, the mean total pharmacy charges and number of patients per DRG were $83,457 and 140, respectively. DRG 107 (coronary bypass) and MDC 5 (diseases and disorders of the circulatory system) had the highest pharmacy charges in the respective DRG and MDC categories. Pharmacy charges as a percentage of hospital charges ranged from 4.1% to 32% for the 20 most expensive DRGs. While there appeared to be a direct relationship between high hospital charges and length of stay for the most expensive DRGs, there did not appear to be a direct relationship between these two measures and high pharmacy charges. Until hospitals have data on actual cost per case and on cost per DRG for each department, analysis of pharmacy charge data by DRG for establishing pharmacy priorities may be a reasonable approach.     

Analysis of workload and staffing requirements for a critical-care satellite pharmacy

A study to determine the workload and the staffing requirements of a proposed critical-care satellite pharmacy is reported. Data for all patients admitted to the adult surgical intensive-care units (SICUs) of an acute-care teaching hospital were recorded for 30 days. Both clinical and distributive data were collected, such as the number and times of patient admissions to the SICUs, the times medication orders were written and their nature, the number and types of drugs administered per patient per day, the number of medication profile reviews per day, and the number and types of interventions. Productivity standards were determined for specific clinical and distributive tasks and used to project the staffing requirements of the new satellite pharmacy. It was determined that proposed changes in distributive services, including expansion of the i.v. admixture program and implementation of a syringe-pump infusion system, would increase the pharmacist and technician staffing requirements by 1.91 and 6.77 hours per day, respectively. Expansion of clinical services, such as pharmacokinetic monitoring, would increase the pharmacist staffing requirements by 8.68 hours per day. It was estimated that the SICU satellite pharmacy could save the hospital more than $200,000 per year. Hospital administration approved a request to increase staffing by 3 full-time-equivalent (FTE) pharmacists and 1.6 FTE technicians. Workload analyses and projections of staffing requirements must incorporate measurements for clinical as well as distributive services.     

Pharmacoeconomic evaluation of treatment of penetrating abdominal trauma.

The hospital, pharmacy, and antibiotic costs for patients with penetrating abdominal trauma were compared with reimbursement received; these costs were also analyzed to assess the potential impact of a total prospective pricing system (PPS). During a four-year period, 46 patients admitted solely for penetrating abdominal trauma were retrospectively evaluated: their discharge summaries indicated that, for 9 patients, reimbursement was based on diagnosis-related groups (DRGs) under the PPS; 9 patients had private insurance; and 28 were classified as "self-paying/no insurance." All costs, corrected for inflation, were reported in 1989 dollars. Antibiotics represented 22.5%, 1.7%, and 0.5% of pharmacy, hospital, and DRG reimbursement, respectively; pharmacy costs were 8.5% of hospital costs and 2.3% of DRG reimbursement. For all 46 patients, a net loss of $295 per patient was incurred. Four patients accounted for 43% of the hospital costs. If the hospital had been reimbursed for all of these patients by prospective pricing and DRGs, it would have had a median profit of $9730 in 42 of 46 patients. Costs exceeded DRG reimbursement in the remaining four patients by a median of $8210. Antibiotic costs and pharmacy costs represent a small portion of hospital costs and DRG reimbursement for patients with penetrating abdominal trauma; thus, cost containment efforts in these patients should be directed at other ancillary services and length of stay.     

Cost of acute hospitalization and post-discharge follow-up care for meningococcal disease in the US

The combined costs of acute hospitalization and post-discharge follow-up care in patients with meningococcal disease have not been widely documented. In this study, data were retrospectively analyzed from three large databases of hospital discharge records and commercial insurance claims in the US. Cases of meningococcal disease were defined as admissions with an ICD-9-CM diagnosis code in the range of 036.x. From the 2005 HCUP Nationwide Inpatient Sample, 349 (weighted N=1,710) meningococcal-related hospitalizations were identified with a mean facility cost (in 2009 dollars) of $19,526 per admission. Similar estimates ($18,119 and $20,066, respectively) were obtained from 268 admissions identified in the LifeLink (formerly PharMetrics) database during 1999-2007 and from 1,058 hospitalizations in the Perspective Comparative Database (PCD) during 2000-2007. Using insurance claims from LifeLink, we estimated that payers incur an additional $26,178 in non-facility (professional and other ancillary) costs during the course of a meningococcal admission, as well as $22,230 in additional medical and pharmacy expenses for post-discharge care during the ensuing year. The majority of follow-up costs ($14,637) were attributed to repeat hospitalizations. Mean length of stay for meningococcal disease was consistently estimated across databases at 8 to 9 days. Data from the PCD further suggested that meningococcal disease carries, on average, nearly 2 days of intensive care unit utilization. In conclusion, hospital admissions for meningococcal disease are costly to payers. These costs are heightened when non-facility services and post-discharge care are also considered. Awareness of the full cost burden of meningococcal disease is needed when evaluating vaccination programs targeting the disease.