Does merging operations always increase cost-effectiveness? An analysis of combined adult/pediatric versus stand-alone pediatric laboratory services

Abstract

An analysis of acuity adjusted health center data from participating Canadian institutions was performed to evaluate the relative cost-effectiveness of adult, pediatric, and combined adult/pediatric health centers. Acuity adjusted costs were then adjusted for the different rates of pay in each laboratory. A synthesis was performed to model the cost-effectiveness of a theoretical combination of stand-alone adult and pediatric laboratories based on a 12% pediatric caseload. The results arising from the model were then compared with existing combined adult/pediatric health centers. The laboratory costs of the modelled adult/pediatric health centers (mean = 134, SD = 15, n = 11) are significantly (p < 0.05) lower than the existing combined adult/pediatric institutions. The actual costs of existing combined adult/pediatric laboratories average 13.4% more than the modelled combination of existing stand-alone pediatric and adult facilities. The results of this analysis should at least serve as a cautionary note for those who are considering merging pediatric and adult health center laboratory services for the purpose of achieving greater cost-effectiveness.