Health care costs in the United States and elsewhere have been the subject of policy discussion for many years. Hospitals and insurers (including governments) are particularly interested in controlling costs while maintaining effective care. However, to manage costs it is important to understand what the costs are. Because of the methods used to reimburse hospitals in the past, little effort was devoted to the costs of individual services.

A project at the University of Utah Hospital is addressing this. The project tracks outcomes and costs at detailed levels. (There are over two million rows in the database for costs and staff time, for example.) The project team tracks costs for supplies, staff, and so on, at the patient level. As a result, the hospital has detailed cost per minute information that helps them manage patient care and cost.

For example:

The hospital has been able to calculate, for instance, the cost per minute in the emergency room (82 cents). In the surgical intensive care unit ($1.43), and in the operating room for an orthopedic surgery case ($12).

Source: Kolata, Gina, "What Are a Hospital's Costs? Utah Systems Is Trying to Learn," The New York Times, September 7, 2015.

The article provides information on the cost per minute in the three areas of the hospital: emergency room, intensive care unit, and the operating room. For what decisions might this information be useful? For what decisions would it not be useful?

Thank you in advance!