Is academic managed care an oxymoron?

Background: A review of 1993 data on length of stay (LOS) and charges for diagnosis-related group (DRG) 195 (complicated cholecystectomies) showed that Maricopa Medical Center charged more and had longer LOS than all other area hospitals. Methods: Twenty DRG 195 charts were analyzed for the causes of the inefficiencies. The remaining cholecystectomy DRGs were similarly analyzed. Results: Analysis of the charts for DRG 195 showed that 55% of the patients had laparoscopic conversions. Charges and LOS varied significantly because of the conversions, increased preoperative hospital days and increased operative times. Moreover, 30% of patients were more than 70 years old. Comparisons of other cholecystectomy DRGs showed similar inefficiencies, indicating a hospital system's problem. Conclusions: Diagnosis-related group delta analysis is a powerful performance improvement tool. Once problem areas are identified and corrected, monitoring prospective data produces rapid analysis of quality of care and cost improvements. The models can serve as a means for teaching hospitals to become more competitive and satisfy the Joint Commission on Accreditation of Healthcare Organizations requirements for patient-care improvements.