An empirical examination of surgeon experience, surgeon rating, and costs in perioperative services

• Published date: 01 July 2018
• Date: 01 July 2018
• DOI: http://doi.org/10.1016/j.jom.2018.04.002

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Journal of Operations Management

journal homepage: www.elsevier.com/locate/jom

An empirical examination of surgeon experience, surgeon rating, and costs

in perioperative services

Sriram Venkataraman

a,∗

, Lawrence D. Fredendall

b

, Kevin M. Taaffe

c

, Nathan Huynh

d

,

Gilbert Ritchie

e

a

Department of Management Science, Darla Moore School of Business, University of South Carolina, 1014 Greene St., Columbia, SC 29208, United States

b

Department of Management, College of Business, Clemson University, 100 Sirrine Hall, Clemson, SC 29634, United States

c

Department of Industrial Engineering, Clemson University, 269 Freeman Hall, Clemson, SC 29634, United States

d

Department of Civil and Environmental Engineering, University of South Carolina, 300 Main St., Columbia, SC 29208, United States

e

Perioperative Product Strategy, Integrated Business Systems & Services, United States

ARTICLE INFO

Keywords:

Healthcare

Surgeon experience

Surgeon quality

Perioperative services

ABSTRACT

We examine how physicians affect the flow of patients through Perioperative Services (POS) on the day of

surgery by studying the effects of surgeon experience and surgeon quality (measured by Healthgrades rating) on

patients' flow. We control for the work environment created by the POS manager's resource allocation decision,

which determines the utilization levels of the three POS departments: Pre-operative (PreOp), Operating Room

(OR), and Post Anesthesia Care Unit (PACU). Using patient level data from a large teaching hospital, we find that

POS managers in all three departments view overtime costs as more important than idle time costs, which

implies that they keep capacity slack available for patient care in each department. Further, our findings suggest

that highly experienced surgeons take ownership of their patients' experience in the POS and that their patients

spend less time in PreOp and the OR. We argue that not only do more experienced surgeons perform surgical

procedures more efficiently, but they also coordinate better with PreOp to reduce patient waiting time there. We

find that a surgeon's rating has no direct effect on a patient's actual surgery time in the OR, but that the effect of

surgeon experience on actual surgery time is higher, in magnitude, for a lower-rated surgeon than for a higher-

rated surgeon. Finally, we conduct a counterfactual analysis and find that highly experienced surgeons reduce

the total length of a patient's stay in the POS.

1. Introduction

Patients undergoing surgery in the Perioperative Services (POS) unit

of a hospital proceed sequentially from the Pre-operative holding de-

partment (PreOp) to the Operating Room (OR) and then to the Post

Anesthesia Care Unit (PACU) during the surgical process. After patients

are discharged from the PACU, they either go home or enter the hos-

pital as an inpatient. There are multiple reasons to improve our un-

derstanding of the factors affecting patient flow through the POS. First,

surgical procedures present an immediate patient safety risk and there

are gaps in our understanding of how the various care processes, sur-

geon characteristics, and hospital factors affect each other (Birkmeyer

et al., 2001). Second, the operations of the POS is important to a hos-

pital's financial success (Gupta, 2007). The POS system provides 55 to

65 percent of a hospital's gross margin (Peters and Blasco, 2004) and it

is also a significant cost center, accounting for 100 percent of ambu-

latory patients' costs and 25 percent of in-patient costs (Berry et al.,

2008). The regular time costs of OR procedures range from

$1

5

per

minute for tracheostomy (Bacchetta et al., 2005)to

$50

per minute for

cardiac surgery (Choi et al., 2012).

The POS capacity setting process affects daily operations and patient

safety in the POS. The POS manager establishes the available capacity

by scheduling ORs to be open for a set number of hours. The capacity

setting process seeks to balance the workload among the ORs to control

both OR under- and over-utilization, since the OR is the most expensive

and constrained department in the POS system and maximizing its ef-

ficiency is important (Dexter and Traub, 2002;Marjamaa and Kirvela,

2007). A common approach to do this is to create block schedules,

which means that the POS scheduler allocates the OR capacity to dif-

ferent surgical specialities. Surgeons in each specialty then schedule

https://doi.org/10.1016/j.jom.2018.04.002

Received 9 February 2016; Received in revised form 1 April 2018; Accepted 10 April 2018

∗

Corresponding author.

E-mail addresses: sriram.venkataraman@moore.sc.edu (S. Venkataraman), flawren@clemson.edu (L.D. Fredendall), taaffe@clemson.edu (K.M. Taaffe),

huynhn@cec.sc.edu (N. Huynh), gritchie@ibss.net (G. Ritchie).

Journal of Operations Management 61 (2018) 68–81

Available online 10 July 2018

0272-6963/ © 2018 Published by Elsevier B.V.

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