Factors Associated with Costs of Hospitalization of Severely Mentally Ill Patients

Background: Efforts to contain costs associated with general medical care include particular efforts for psychiatric disorders. Hospitalization represents the largest component of costs for psychiatric care and there is growing interest in balancing clinical needs against limiting costs of inpatient psychiatric care of patients with severe mental illnesses. This study aimed to evaluate clinical factors associated with actual costs of inpatient psychiatric care. Method: We evaluated a cohort of 589 hospitalized psychiatric patients with severe mental illnesses at a nonprofit, university-affiliated psychiatric hospital for factors associated with annualized total costs of inpatient care over a three-year period, using bivariate and multivariate analyses. Results: As expected, days-hospitalized was the major determinant of total costs of hospital care. In addition, several clinical and treatment factors also were associated significantly and independently with costs in multivariate modeling. These included presence of psychosis, electroconvulsive treatment, specialist consultations, use of multiple antipsychotics or of clozapine, and being discharged to a supervised living arrangement, but not sex, age, marital status, employment, or substance abuse. Discussion: As expected, costs of psychiatric hospitalization were dominated by per-diem charges, but also influenced by other, potentially modifiable treatment factors generally associated with more severe psychotic illnesses. The study is based on actual costs rather than on insurer-reimbursements and a large study-sample, though at a single institution. Specific factors identified encourage focusing on patient characteristics associated with greater costs and redoubled efforts to apply and improve alternative, cost-effective interventions such as partialhospital and intensive outpatient treatment.