The Financial Burden of Cancelled Surgeries: Implications for Performance Improvement

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The Financial Burden of Cancelled Surgeries: Implications for
Performance Improvement
Claudia Campbell, Ph.D., Arthur Mora, M.H.A., Stephanie Russo,
M.P.H., C.P.H., Nadira Abdur-Rahman, Nakeisha Pierre, M.D., Frank
Rosinia, M.D., Sabrina Bent, M.D., M.S.
Introduction: Cancellations in the operating room (OR) contribute
to decreased OR efficiency and therefore impact revenue. While a
number of studies have examined the sources of cancellation of
elective surgical procedures, few studies have estimated the costs
associated with these cancellations in a US academic medical center.
Understanding the magnitude of these opportunity costs can be
used to justify the use of more resources to prevent cancelled
surgeries and to improve processes which contribute to
cancellations. This study examines the characteristics and costs of
the cancelled outpatient surgical procedures that occurred in a
single academic medical center in 2009. The procedures were
either cancelled after the patient arrived or because the patient
failed to show up (“no shows”) on the day of surgery.
Methods: Financial data and OR metrics from Tulane University
Medical Center in 2009 were analyzed following IRB approval. A
preliminary analysis reviewed 4876 scheduled elective outpatient
surgical procedures. Hospital revenue was calculated based on
Medicare payment rates. Commercial rates were discounted by
20% for revenue analysis.
Results: The overall cancellation rate, defined as patient “no
shows” plus cancellations after arrival divided by all scheduled
procedures, was 6.7 %, 327 of 4876 scheduled cases. Rates of
cancellation varied by specialty and by day of the week. (See Tables
1 and 2) 32.4 % of cancellations were attributed to “no shows.”
Using Medicare payment rates, estimated total hospital revenue
losses for cancelled surgeries, n= 327, was $1,487,850, or $4,550 per
cancelled case, in 2009. (See Table 3) In the 13.8% of the 327

cancelled cases where a reason was recorded, 44% of cancellations
were due to the patient being ill on the day of surgery, 24% to
patient failure to comply with pre-operative instructions and 31%
to institutional issues such as unavailability of beds or equipment.
Cancellations were higher among patients who did not have a
preoperative clinic visit, 10.64%, as compared to 3.92% of those
with preoperative clinic visits.
Table 1. Cancellation by Specialty
Specialty
Total, n
Cancelled
After Arrival, n
No shows, n
Cancellation Rate, %
Cardiology
13
2
0
15.38
General Surgery
1334
89
41
9.75
Neurosurgery
320
22
5
8.44
Obstetrics/Gynecology
51
1
0
1.96
Oncology
4
0
0
0
Ophthalmology
676
12
6
2.66
Orthopedics
1140
31
8
3.42
Otolaryngology
245
14
7
8.57
Pediatrics
156
13
1
8.97
Plastic Surgery
72
8
0
11.11
Radiology
64
9
5
21.88
Thoracic Surgery
202
23
1
11.88
Urology
599
23
6
4.84
Total
4876
247
80
6.71

Table 2. Cancellation by Day of the Week
Day of the Week
Total, n
Cancelled, n
Cancellation Rate, %
Monday
1204
77
6.40
Tuesday
1087
61
5.61
Wednesday
932
68
7.30
Thursday
951
76
7.99
Friday
702
45
6.41
Total
4876
327
6.74
Table 3. Loss Revenue by Specialty
Specialty
Total, n
Total Loss
Revenue, $
Revenue Loss
Per Case, $
General Surgery
45
211,810
4,707
Neurosurgery
2
2,825
1,412
Ophthalmology
11
40,712
3,701
Orthopedics
11
78,962
7,178
Otolaryngology
9
14,913
1,657
Pediatrics
6
34,186
5,697
Plastic Surgery
3
7,628
2,542
Radiology
6
13,156
2,193

Thoracic Surgery
7
38,804
5,543
Urology
4
30,179
7,545
Total
104
473,175
4,550
Conclusions: A significant amount of revenue is lost from
cancelled cases. Costs of cancellations in some specialties have
greater impact than others. Pre-operative visits have the potential
to prevent cancellations, increasing productivity and improving
financial performance. Further research is needed to understand
how to reduce cancellations associated with problems originating in
the hospital or physician practice.
Summary: Cancelled elective outpatient surgical procedures result
in opportunity costs which can be substantial. This revenue loss
may support the allocation of additional resources toward
perioperative services and process improvements aimed at
decreasing cancellations.