Research

The costing of operating theatre time in a secondary-level state sector hospital: A quantitative observational study

J P Samuel, A Reed

Abstract


Background. There is no established costing model for operating theatres (OTs) in South Africa (SA), yet both health sectors have existing charges for OT time: in the state sector, Uniform Patient Fee Schedule (UPFS) rates, and in the private sector, rands per minute (ZAR/min) rates. Understanding the cost of providing the separate components of a health service is important for planning and funding purposes.

Objectives. Primary objective: To develop a costing model that would allow calculation of the ZAR/min cost of OT time. Secondary objective: To determine the actual costs, in order to establish the comparable costs that would be included in the ZAR/min charges for OTs in the private health sector.

Methods. The OTs in a secondary-level, state sector hospital in Cape Town were used in this quantitative observational study to develop a top-down costing model for OTs in SA. The inclusive costing model was developed in a consultative process with professionals, managers and experts from the state and private sectors. The model was then populated with costs for the month of August 2018. Costs were considered in the categories of full costs, shared costs, and capital or annualised costs.

Results. Owing to uncertainty in costing of OTs, two models – with different annualisation times assigned to the capital costs – were developed to demonstrate the difference. For shared costs, correction factors were determined using either an activity-based (workload) factor or a more generic estimation of workload using theatre nursing staff as a percentage of total hospital nursing staff.To determine a ZAR/min cost of creating a minute of available theatre time, all the annual costs were divided by minutes that the OTs are explicitly available, each year, to provide patient care. The model was then populated with costs using the appropriate correction factors. The longer annualisation model costed OT time at ZAR31.46 per minute, and the shorter annualisation model at ZAR33.77 per minute. In both the longer and shorter capital annualisation models, nursing was the largest contributor to costs at 36% and 33%, respectively, followed by construction costs at 9% and 11%, and then OT equipment at 8% and 11%.

Conclusions. An inclusive, top-down costing model for OTs in SA was developed. This costing model will support work to develop costing for individual procedures and the appropriate charge for planned and emergency OT time, and to better determine budgeting for OT services. Meaningful critique of the model will improve its fidelity, and is likely to increase its utility, especially as SA moves towards universal health coverage.


Authors' affiliations

J P Samuel, Department of Anaesthesia and Perioperative Medicine, Faculty of Health Sciences, University of Cape Town, South Africa

A Reed, Department of Anaesthesia and Perioperative Medicine, Faculty of Health Sciences, University of Cape Town, South Africa; Western Cape Department of Health, Cape Town, South Africa

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Keywords

Operating theatres; Costing models; Theatre time; Top-down costing

Cite this article

South African Medical Journal 2021;111(6):595-600. DOI:10.7196/SAMJ.2021.v111i6.15345

Article History

Date submitted: 2021-05-31
Date published: 2021-05-31

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