The use of robotics is already relatively wide-spread in manufacturing and warehousing environments. But since the year 2000, they are also known for giving surgeons a helping hand in what has become “a digital operating room”. The market is (still) being dominated by California-based giant Intuitive Surgical – with an installed base of around 4,000 systems in 2016 (of which 67% is US-centered). Since its inception, Intuitive’s flagship system (Da Vinci) has assisted roughly 5 million procedures worldwide, of which 850,000 took place in 2017. In 2000, things started off with a mere 1,000. RBC Capital, an investment bank, estimates that the share of robot-assisted procedures will only increase – to 35% of total worldwide procedures in 2024.
The push of robotics in the operating theater is no surprise. On the one hand, more and more physicians are convincing their (medical) board of the added value (in quality and efficiency of care) of a surgical robot. On the other hand, the market for robotic surgery increases – partly because its capabilities are being discovered to work well on more and more types of procedures (supply-driven). Secondly, because of the growing incidence of chronic (from urological, over gynecologic and thoracic to orthopedic) diseases that simply ask for robotic assistance. The bulk of several, more complicated, procedures is already robot-assisted, think prostatectomies (90%) and hysterectomies (70%).
Big buts… cannot lie
Given the advanced capabilities (more intuitive control, haptic feedback, miniaturization able to support finer surgery, etc.) and analytics (machine learning and AI) make you expect that penetration of robotics in the OR will go smoothly (cfr ‘Robotic surgery.. the future!’). There are a few big buts however.
The first one is scientific medical evidence of the superior quality of care of robot-assisted procedures. Widespread heard advantages of robotic surgery are less time in the OR and hospital, quicker patient recovery and reduced risk of complications. Scientific evidence proves the dominance robot-assisted and laparoscopic procedures over conventional open ones – but this supremacy is not all that clear between the former two. At least this is what payers in healthcare systems today think, proven by the lack of reimbursement of investment in equipment and robotics instruments towards care centers.
This relates to the second but: the financial pressure robotic surgery puts on (already constrained) hospital budgets. With a multi-million-euro investment for the equipment, a considerable maintenance fee, plus the cost of (limited reusable called ‘reposables’) instruments – the Da Vinci system is expensive at the outset. Getting an objective view of the economic relevance of such an investment, however, requires estimating economic gains across the ‘patient journey’. Comparing robotic versus open procedures can amount to multiple thousands of € per procedure (considering the full cost of the procedure, including a decrease in length of stay). But for different, often more complicated, procedures, the Da Vinci system seems to be competitive (both in terms of financial and medical outcome). If the future makes surgical robots cheaper, its benefits will surely spread and its contribution to value-based healthcare will only rise.
Give and take
The coming two years will be pivotal for robotic surgery. The market will open up and ‘give’ care centers a break. Increased competition of both challenging start-ups (think Auris, MMI and CMR) and incumbents (Medtronic, Johnson & Johnson and the like), together with mergers and acquisitions between other vendors, will bring greater affordability of systems and more technological innovation.
However, financial viability of robotic surgery programs for care centers is there for ‘the taking’ today. There are several measures that hospitals can already implement that lower the costs of robotic surgery (even without the advent of lower-cost systems).
Planning a higher caseload
Allowing and planning a higher caseload onto current robotic systems will allow to push up utilization. Current OEE (‘Overall Equipment Effectiveness’, a performance metric that evaluates how effectively a manufacturing operation is utilized) of expensive medical infrastructure is as low as 40%, a metric that would send shivers down the spine of many operational and financial controllers in industrial environments, who are used to over 90%. Increasing utilization brings economies of scale and lowers fixed costs – all the more important since these make up ~30% of the total cost of ownership of a robotic system.
Forging partnerships or engaging in hospital networks
One way to create scale is by forging partnerships or engaging in hospital networks. This will not only increase OEE, but this will also enable physicians to stock up the necessary experience time on the robot (allowing them to race down the learning curve). Finally, this will give care givers more flexibility in balancing the portfolio of robotics procedures, both from a financial and a quality of care point of view.
Choosing the right portfolio of robotics procedures
Choose the portfolio of robotics procedures wisely. The overall return of a robotic surgery program can be improved by carefully selecting the type and volume of procedures to be included, from different points of view.
- Strategic point of view: including the procedures that are important for the positioning & strategy of the hospital (network).
- Financial point of view: Different procedures have a different financial impact based on a multitude of factors (volume, OR-time, length of stay, probability of readmission and differing reimbursement patterns for equipment and reposables, etc.). Getting a clear sight on the ‘net result’ of (types of) robotic surgery procedures is paramount to construct the portfolio wisely. Balancing the portfolio can be done by increasing the share of procedures with a lower negative impact on the total cost of the program. Generally, this will be the case for (medium to) complex procedures where the added value of robotics in terms of time and care efficiency pays off – compared to conventional laparoscopic or open procedures.
- Rationalization point of view: if the added value of performing certain types of procedures on a robotic system is not at all clear, or the financial burden simply too high, laparoscopic surgery can still prove a valuable alternative (both in terms of financial impact and medical outcome). This is especially the case for low-cost hospitals or hospitals under budget pressure. Manufacturers of laparoscopic devices should (and will) be creative to make laparoscopic surgery more accessible to facilitate the use of video-endoscopic surgery, which up to now seems to have a similar efficacy as robotic surgery.
Reducing operating time
Reduce time in the OR by reducing operating time (console time). In this sense, it is possible to attribute a higher share of ‘robot-time’ to highly efficient surgeons or train dedicated robotics surgeons with higher efficiency (again, depending on hospital or network strategy). In many cases, we still see room to decrease non-operative time in an OR dedicated to robotic surgery (before the console time starts) using a lean room set-up, a clear role and task divisions, parallel tasking, and providing back-up material. Studies on robot-assisted gynecological procedures (cfr. ‘A financial analysis of operating room charges for robot-assisted gynaelogic surgery’, B. Zeybek, T. Oge, C. Kilic, M. Borahay and G. Kilic) find the (median) time before operations to begin to amount to 55 minutes – already increasing cost per procedure with 2-3k ($).
Standardization of instruments
There appear to be big cost differences between surgeons, related to instrument use. Standardization of instruments across surgeons in similar procedures is estimated to be able to yield considerable cost savings – even more important since additional instruments can be limited use. For example, using 4 instead of 5 instruments by using only one needle driver saves up to € 290 – which can amount to 15-20% of the cost difference between robot-assisted and laparoscopic procedures.
Developing a clear governance
Like every multi-million € investment, a robotic system should be encompassed by a program with clear governance. Developing a clear vision on use and expansion of the system, developing a metrics system for sound reporting and follow up (both in terms of case load, quality and financial impact), establishing clear accountabilities in the form of a steering committee and communicating to stakeholders inside and outside the care center – are only a few of the structured benefits a formal program can yield.
Back … from the future
Robotic surgery has been and will revolutionize the operating room in the years to come. The market will open up and new players will pave the way towards lower cost-systems and more technological innovation to increase adoption rates. Some healthcare visionaries say the future is here. It does make sense for hospital boards to take a step back and think of the way robotic surgery programs are measured and managed today.
Getting the basics right today will drastically improve the financial viability of current robotics programs – and help to build capabilities that will be a lever towards more ‘value for money’ in the future. Robotic surgery is a lever towards the holy grail of true value-based healthcare; a concept much talked about but seldom achieved in healthcare. Because that in the end, is what the age of robotics is all about.
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Download our paper about ‘Robotics in a digital OR: the journey towards value-based healthcare‘.