Wide Differences in the Estimation of Cost in Endovenous Laser Therapy for Varicose Veins

PURPOSE: To investigate differences in cost of endovenous laser therapy (EVLT) using a top-down approach derived from the Annual Report versus a clinically orientated, bottom-up approach at a single hospital. METHODS: Information was obtained from: the day-case activity Service Line Report (SLR) income statement for general surgery, comparative data from the National Audit Commission, reference costs from the hospital finance department on 69 patients and calculations on individual treatment times and session slots (2 EVLT's per 3.5 hr session) on 37 consecutive patients. Duration of treatment, consumables (over 3) pound and staff pay were also recorded. Overheads were estimated at 15% and adjustments were made based on location and length of stay. RESULTS: Using a top-down approach with SLR data the total cost of EVLT was estimated at 963.78 pound per treatment after adjustments for services and consumables. This compares with 1,073.34 pound using national data. The hospital reference costs per treatment ranged from 767.56 pound overall by local procedure code (HRG-QZ10B) to 2,353.79 pound with individual samples. In the bottom-up approach median duration of EVLT was 86 mins (95% CI: 82-95, IQR: 26). With timed treatments median cost per individual treatment was 597.68 pound (95% CI: 587.65-621.25, IQR: 67.87) compared to 647.28 pound per session slot. CONCLUSION: Cost estimations of EVLT demonstrate an up to 4-fold difference. Lack of clinical engagement in the top-down approach leads to overestimations. Overheads are underestimated with a bottom-up approach. This variability should be accounted when comparing treatments or interpreting cost-effectiveness analyses.