Revisiting the economic efficiencies of observation units

Ibrahim M. Abbass, Trudy M. Krause, Salim S. Virani, J. Michael Swint, Wenyaw Chan, Luisa Franzini

Research output: Contribution to specialist publicationArticle

11 Citations (Scopus)


Background: Recent studies cast doubt about the economic efficiency of observation units (OUs). Objective: We aimed to reexamine the cost savings of OUs compared with inpatient care. Methods: Claims for 15,851 patients who were admitted to inpatient or OUs between January 2009 and December 2012 following emergency room (ER) visits for chest pain were retrospectively examined. The two groups were compared for total cost of episode, length of stay (LOS), and utilization rates of diagnostic procedures, including standard exercise and echocardiography stress tests, myocardial perfusion imaging (MPI), coronary computed tomography angiography (CCTA), and computed tomography (CT) chest scans. Total costs of care and LOS were adjusted for age, gender, risk scores, and comorbidities using quantile regression. Results: More than 37% of the sample was admitted to inpatient units (n=5,890) vs 62.7% to OUs (n=9,961). Patients admitted to inpatient units had more comorbidities and longer LOS during their ER visit (median 1.5 adjusted days; 10th percentile=1, 90th percentile=3) vs. median 21 adjusted hours for OUs (20, 23). The adjusted median cost of OUs was $5,411 ($4,652, $7,157) vs. $6,946 for inpatient admission ($5,978, $18,683). The estimated adjusted cost saving of OUs was $1,535 (95% CI=$1,206, $1,411) compared with inpatient admission. About 37% of patients admitted to OUs stayed longer than 24 hours. Compared with patients admitted to inpatient units, patients in OUs also received more MPI (35.8% vs. 31.5%), CT scans (13.2% vs. 10.4%), standard exercise test (45.6% vs. 33.8%) and echocardiography stress test (8% vs. 3.4%). Conclusion: Despite the increased proportion of patients exceeding the 24-hour LOS and the increased utilization of advanced imaging procedures, OUs are still less costly compared with inpatient admission.

Original languageEnglish
Number of pages7
Specialist publicationManaged Care
Publication statusPublished - 2015
Externally publishedYes


  • Costs
  • Diagnostics
  • Imaging
  • Inpatient
  • Length of stay
  • Observation units


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