BUSI 629 Week 3 Discussion Board Forum 3 Example

Discussion Board Forum 3: Costs, Production and Volume

BUSI 629 Economic Analysis in Healthcare, Discussion Board Forum 3

Thread by [Student Name]

The hospital, its procedure volumes and the classmates are composites; the textbook and the peer-reviewed sources cited are real.

Our 260-bed hospital performs about 240 flexible bronchoscopies a year, split between the endoscopy suite and the intensive care unit. Our five reusable bronchoscopes are nine years old, repair bills have climbed and the vendor has quoted about $210,000 to replace the fleet, plus a service contract. A second vendor offers single-use bronchoscopes at about $300 each. Our respiratory therapy director favors replacing the fleet, arguing that a disposable scope at $300 is far more expensive than the few dollars of cleaning supplies a reusable scope needs after each case. That comparison, I argued, confuses variable cost with total cost.

Lee (2015) distinguishes fixed costs, which do not change with the number of procedures over the planning period, from variable costs, which rise with each procedure, and defines average cost as total cost divided by output. A reusable fleet carries large fixed costs: purchase price spread over its useful life, service contracts, repair reserves, reprocessing equipment and the staff time to clean, test and store each scope. Its variable cost per use, cleaning supplies and some technician time, is small. A single-use scope is the opposite, almost all variable cost. As volume rises, the reusable fleet's fixed costs are spread over more procedures and its average cost falls, which is what economists call economies of scale. At some volume, the two options cost the same. Below that break-even point, the low-fixed-cost option wins; above it, the low-variable-cost option wins.

Published studies show where the break-even point can fall, and how much it depends on local conditions. Thiboutot et al. (2026) followed 25 reusable bronchoscopes through their use cycle in a U.S. endoscopy unit and calculated a per-use cost of about $198 to $202 once capital, servicing, staffing and reprocessing were included, compared with $300 to $400 for single-use scopes. Their sensitivity analysis showed per-use cost falling steeply as volume rose: reusable scopes were the better choice above about 900 procedures a year, single-use scopes below about 400, and the two were roughly equal in between. Flandes et al. (2025), studying 1,394 bronchoscopies at a Spanish university hospital, reached a very different threshold: reusable scopes were already cheaper above about 50 procedures a year, at €203 per procedure against €259, with the advantage leveling off beyond 250. They also found that reusable scopes cost €349 to €392 per procedure when used outside working hours, when reprocessing staff are paid premium rates, and that high-risk procedures that frequently damage scopes erase the reusable advantage.

Because the published thresholds differ so widely, I calculated our own. Our fleet's fixed costs come to about $67,000 a year: $42,000 in depreciation on the quoted replacement, a $15,000 service contract and about $10,000 in repairs. The variable cost of each reusable use, cleaning chemicals, test supplies and technician time, is about $45. Each single-use scope costs $300. The break-even volume is therefore $67,000 divided by the $255 difference in variable cost, or about 263 procedures a year. At our current 240 procedures, single-use scopes are slightly cheaper overall, but we are close enough to the break-even point that modest growth would reverse the answer. Our ICU performs about a third of its bronchoscopies at night, where the Flandes et al. (2025) finding about after-hours reprocessing costs applies directly.

I recommended a mixed approach: replace the fleet with two reusable scopes for scheduled daytime procedures in the endoscopy suite, where volume is steady and reprocessing staff are on duty, and use single-use scopes in the ICU and after hours. That cuts fixed costs sharply while keeping the low variable cost for the predictable daytime volume. Two factors outside the per-use comparison support the split: single-use scopes remove the risk of infection from inadequately reprocessed scopes for the sickest patients, while the smaller reusable fleet limits the medical waste our sustainability committee has raised. We will review the split if annual volume rises above 300. The cheapest option per procedure depends less on the price tag than on how many procedures share the fixed costs, and that number differs for every hospital.

Reply to Hannah

Hannah, your thread asked whether your urology practice should keep its reusable flexible ureteroscopes or switch to single-use models, and you leaned toward reusable scopes because their price per case looked lower. The same fixed-cost logic applies, and a recent study gives precise figures. Zekraoui et al. (2026) performed a micro-cost analysis at a Canadian center doing about 418 ureteroscopies a year and found total annual costs for its reusable fleet, including acquisition, repair and reprocessing, of about $102,421, or $245 per procedure. Reusable scopes became cheaper than single-use models above about 130 cases a year for one lower-priced single-use device and above 83 cases for another. The fleet needed a repair roughly every 20 procedures, most often for leaks at the distal tip. Lee (2015) notes that repairs and maintenance belong in cost analysis even though they arrive irregularly, and this study shows they are a large share of reusable cost. If your practice performs well above 130 cases a year, your instinct to keep reusable scopes is probably right, but I would suggest tracking your own repair rate, since frequent repairs raise the effective fixed cost and move the break-even point higher. Keeping a few single-use scopes for times when reusable ones are out for repair could also protect your schedule without changing the overall economics. Repair turnaround matters as much as repair cost, a point the study's repair log makes vivid: a scope away for three weeks is fixed cost producing nothing, and canceled cases carry their own price in lost revenue and frustrated patients. If your vendor's loaner program is unreliable, the value of a small single-use backup stock rises. Finally, ask whether your reprocessing is done in house or contracted, since that choice shifts some reprocessing from fixed to variable cost and changes your break-even point again.

Reply to Derrick

Derrick, your thread concluded from volume alone that your large hospital should stay with reusable scopes for every case. A recent randomized cohort study suggests case mix also matters. Unno et al. (2025) compared reusable digital ureteroscopes with single-use scopes in 178 complex kidney stone operations that combined two approaches. Single-use scopes cost $840 per case and reusable scopes $1,499, because the reusable scopes needed repair after a median of only 13.5 cases, and the break-even point for the reusable scope was 156 cases. Scope damage was more likely with supine positioning, prior stenting and denser stones. Lee (2015) explains that variable costs can rise with the intensity of use, not only with the number of uses, and in complex cases repairs behave like a variable cost tied to each procedure. That changes the comparison: a high-volume department might use reusable scopes for routine cases and single-use scopes for the complex cases most likely to damage them. Single-use scopes in that study required more laser energy and longer operating times, about 12 minutes more per case, so the savings must be weighed against room time. I would suggest sorting your cases by complexity and calculating repair costs separately for each group before deciding that one device fits every procedure. The analysis can be done with data your department already has, the repair log, the case schedule and stone characteristics recorded in operative notes. If complex cases account for most repairs, routing them to single-use scopes could extend the life of the reusable fleet and lower its average cost for the routine cases it handles best. That is a case where mixing options beats choosing one, and it mirrors the split fleet I proposed for bronchoscopes in my own thread this week, because each device is used where its cost structure is strongest.

References

Flandes, J., Giménez, A., Álvarez, S., & Giraldo-Cadavid, L. F. (2025). A micro-costing analysis of single-use and reusable flexible bronchoscope usage in the bronchoscopy service at a tertiary care university hospital. Journal of Bronchology & Interventional Pulmonology, 32(2). https://doi.org/10.1097/LBR.0000000000001008

Lee, R. H. (2015). Economics for healthcare managers (3rd ed.). Health Administration Press.

Thiboutot, J., Wang, D., Pai, C., Huang, S., & Yarmus, L. (2026). Cost implications for single-use and reusable flexible bronchoscopes. Respiration, 105(8), 844-852. https://doi.org/10.1159/000550563

Unno, R., Taguchi, K., Hamamoto, S., Yanase, T., Kawase, K., Sugino, T., & Yasui, T. (2025). Cost of reusable vs. single-use ureteroscopes in complex renal surgeries: A randomized cohort study. World Journal of Urology, 43(1), 680. https://doi.org/10.1007/s00345-025-05957-y

Zekraoui, O., Lee, N., Kim, J., Belliveau, S., Alghamlas, A., Meskawi, M., Elterman, D., Benard, F., Chughtai, B., & Bhojani, N. (2026). Micro-cost analysis of reusable compared to affordable single-use flexible ureteroscopes. Canadian Urological Association Journal, 20(2), 31-36. https://doi.org/10.5489/cuaj.9327