Reducing arthroplasty costs via vendor contracts.

OBJECTIVE

To describe a method of reducing the costs of implants in hip and knee arthroplasty.

DESIGN

Implant costs were compared before and after the implementation of a 2-year contract with implant vendors, providing increased volume for decreased implant cost. An additional 20% of arthroplasties could be done outside the contract for research or special purposes.

SETTING

A regional health authority involving 2 acute care hospitals.

METHOD

Costs were obtained for 942 hip and knee arthroplasties performed in 1993/94 and compared with costs of 1656 hip and knee arthroplasties performed in 1996/97.

OUTCOME MEASURES

Implant cost and number of joint arthroplasty procedures performed.

RESULTS

A 40% decrease in the cost per implant for primary knee arthroplasty and an 18% decrease in the cost per implant for primary hip arthroplasty were achieved. A rebate, calculated as a percentage of volume used, was received from the vendor to support general orthopedic research and education. A new contract for 3 years has recently been signed with 3 vendors designated as primary vendors for 80% of the volume.

CONCLUSION

The vendor-contract economic strategy effectively reduced the cost of hip and knee arthroplasty and may be useful at other centres looking for cost reduction methods that maintain adequate patient care and support clinical research and education.