Activity Wise Unit Cost of Blood Components in a Tertiary Care Hospital Blood Bank for the Year 2018

Abstract

The present study on cost of a unit of blood was conducted in blood bank of a tertiary care public hospital with an annual collection of 20,748. A retrospective chart review was done to calculate the activity wise annual unit cost of blood, based on WHO guidelines (Blood Safety Unit. safe blood and blood products: costing blood transfusion services, World Health Organization, Geneva, 1998). Cost of blood collection, processing and storage were included. Annualized economic cost of equipments, maintenance, personnel salaries, and consumables were enlisted. It was assumed that all component units prepared carried equal cost. The cost of building, maintenance and office stationary were excluded. Data extracted from records was compiled and analysed using MS Excel. The annual unit cost of blood with component preparation and NAT testing was Rs 1829. Unit cost of blood without NAT testing was Rs 1255. Unit cost of blood if total collection was in-house, that is, excluding expenditure on camps was Rs 1738. The cost of whole blood (that is, if no components were prepared) with ELISA testing, done to ascertain cost at basic functioning was Rs 2521. With NAT testing the unit cost increased by Rs 575, the additional expenditure being equally divided among all components. Expenditure on NAT was high which was 1/3rd of the total expenditure on consumables. The additional cost incurred on each unit due to expenditure on camps was small i.e. only Rs 91 with 30% collection from camps. Voluntary camps ensures safe blood at minimal cost increment and component separation reduces cost and permits judicious use. Hence these activities should be promoted.

Introduction

Blood transfusion is a vital part of patient care. The rising cost of Blood reflects the rising cost of healthcare globally. Though Blood is sourced from voluntary or replacement donors, its collection, processing, component preparation, testing, storage and distribution involves expenditure. To meet this expense, blood banks charge for the ready to issue blood unit but the cost may vary from country to country and region to region even within the same country. Blood Transfusion Services of a country may be centralized, regionalized, standalone, hospital based or some combination of them [1]. The cost of blood unit may even vary between government, private and Non-Governmental Organisation (NGO’s) managed blood banks [2], depending on their source of funding. Most government blood banks supply for free whereas the NGO and private blood banks charge the patients. The rates are not uniform and vary greatly from one blood bank to another.

There are different ways of calculating cost of a unit of blood. According to World Health Organisation (WHO) costing guidelines, economic cost is used for calculation that takes annualized value of capital goods. The societal perspective of cost calculation includes hidden costs like, cost incurred by the donor like loss of wages, loss in production, cost of travel to and from the blood centre etc. [3]. Costing of blood transfusion services is necessary for policy makers and transfusion service managers for planning and mobilizing resources needed to sustain an adequate supply of blood [2].

The cost of blood also varies in different transfusion services within India depending upon the facilities available like component separation unit, license for organizing blood donation camps and use of additional testing methods other than the mandatory tests. Published literature from India on costing of blood and components is scarce. National Blood Transfusion Council (NBTC) recommendations which are issued from time to time forms a bench mark for costing, the latest of which was on 1st June, 2017. Moreover cost estimates from other countries might not be applicable to India as health systems and policies differ from one country to another. The present study aimed to determine the activity wise cost of unit of blood based on costing guidelines provided by WHO, in a tertiary care public hospital of North India.

Materials and Methods

The Study Setting

This retrospective Chart Review was conducted at the Department of Transfusion Medicine, in a tertiary care public hospital in North India. The cost of unit of blood was calculated for the year 2018. The annual collection in the study hospital was 20,748 and 30% of blood was collected from outdoor camps. In addition to the mandatory ELISA tests, NAT testing is also performed at this blood bank. Approximately 70–80% of the collection was separated into components. The total number of components prepared in the study hospital was 47,069 on the year 2018.

Methodology for Calculation of Cost

Calculation was based on the costing tools provided by the Blood Safety Unit of WHO (World Health Organisation [2]). It was assumed that the cost of all blood components had equivalent costs. Activity wise annual expenditure was calculated, namely, cost incurred on Blood donation camps, collection, testing and processing of blood into components.

The total expenditure was calculated under two heads, capital cost and recurring cost. All items were enlisted and added up to derive the total annual expenditure. All consumable items received in the store were included in the calculation irrespective of their wastage during consumption. The total annual expenditure was then divided by the total number of blood and components prepared in the year 2018 in the hospital. The denominator included all blood and components produced irrespective of the fact that the components were transfused or discarded. Assuming that the cost was equivalent for all blood components, this value represented the ‘investment’ per unit of blood and component produced in the year.

The capital cost included the cost of equipments and their maintenance. Economic costs of equipment on an ‘annualized’ (cost per year) basis, was used to estimate the annual cost of equipments. Annualized cost takes into account the current value, average life of the equipment as 5 years-from the chart provided in the WHO costing guidelines [2], and a discount rate of 10% fixed by the World Bank, to calculate the ‘Annualisation factor’. Annualization factor of 3.791 was used for calculation. The cost of the equipment was divided by the annualization factor to calculate the annualized economic cost of the equipment [4]. Maintenance cost was calculated as 3% of the total equipment cost. The maintenance cost and annualized economic cost was added to determine the capital cost [2]. The recurring expenditure included staff salaries, consumables and miscellaneous items.

The type of blood bags routinely used in blood bank are double, triple and quadruple bags. Bags with inline filters are used specifically for Thalassemic patients. Semi Automated Column Agglutination method is used for red cell serology. Similarly a semi-automated system is used for ELISA. A fully equipped Mobile van, with four donor couches and other equipments for cold chain maintenance is used for blood donation camps.

Limitation of the study was that the expenditure incurred on the following items were not included in the calculation:

1. The cost of building and maintenance was not included in the capital cost as the blood bank is located in the premises of a large public hospital.

2. Large number of other resources that are provided free of charge, like, electricity bill and maintenance charges, office stationary material was also not included in recurring cost.

Data Collection and Compilation

Data related to expenditure was collected from the records available in the Blood Bank store and purchase department of the hospital. The record of staff salaries was taken from the administrative section. All data was entered in MS Excel spreadsheets separately.

Data Analysis

Unit cost was calculated in the following four ways:

This was done to understand the incremental cost by the addition of each activity.

• (A)Unit cost of components was calculated at the present level of functioning of the blood bank (blood collection from both camps and in house, mandatory TTI testing, NAT testing with 70–80% of the collection being separated into components).
• (B)Unit cost was calculated excluding the expenditure on NAT testing, all other activities remaining the same as in (A).
• (C)In the third way, the unit cost was calculated excluding the expenditure on voluntary donation camps, other activities remaining the same as (A).

  For the above three ways of costing the total expenditure was divided by total components prepared in the year 2018 which was 47,069 to determine the unit cost.

• (D)The fourth way was used to calculate the unit cost at basic minimum level of functioning of a blood bank i.e., without component separation with basic ELISA testing (excluding expenditure on component preparation and NAT testing). The expenditure was divided by total units collected in the year 2018 i.e., 20,748 units.

Result

The total annual expenditure of blood bank for the year 2018 was Rs 86,096,513.01. The expenditure on salary was Rs 33,124,056.00 which constituted 38.5% of total annual expenditure. The total consumable cost was Rs 42,533,290.65 which constituted 49.4% of total expenditure. Annualised expenditure for the annual year 2018 on blood bank equipments including the mobile van along with their maintenance cost was Rs 10,439,166.00 which accounted for 12.10% of the total cost (see Table 1).

Table 1.

Category of items included in the study

S. No.	Category	Total cost of each category	Percentage of total expenditure
1	Equipment	Rs 104,39,166	12%
2	Personnel’s salaries	Rs 3,31,24,056	39%
3	Consumables	Rs 4,25,33,291	49%
	Total expenditure	Rs 8,60,96,513	–

Activity wise cost of a unit of blood varied with the inclusion or exclusion of different activities. The annual unit cost of blood with component preparation and NAT testing was Rs 1829. Unit cost of blood without NAT testing was Rs 1255. Unit cost of blood if total collection was in-house, that is, excluding expenditure on camps was Rs 1738. The cost of whole blood (that is, if no components were prepared) with ELISA testing, done to ascertain cost at basic functioning was Rs 2521 (see Table 2).

Table 2.

Activity wise annual cost of a unit of blood

S. No.	Calculation by activity	Cost of equipment in INR (annexure 1)	Personnel Salary in INR (annexure 2)	Cost Of Consumables in INR (annexure 3)	Total number of units included	Total expenditure in INR	Unit cost in INR
1	Activity A	10,439166	33,124,056	42,533,291	47,069	86,096,513	1829
2	Activity B	9,117,145	33,124,056	16,837,191	47,069	59,078,391	1255
3	Activity C	6,619,992	32,770,800	42,393,291	47,069	81,784,083	1738
4	Activity D	6,706,132	33,124,056	12,475,334	20,748	48,486,347	2521

Additional cost incurred on each activity was calculated separately. The additional cost incurred on the component preparation was Rs 8,216,609.92 which is 9.54% of total expenditure. Similarly, the additional cost on conducting camps was Rs 4,312,430.00 which is 5.01% of total expenditure. The additional cost incurred on NAT testing was Rs 27,018,121.9 which is 31.38%, almost 1/3rd of the total expenditure (see Table 3).

Table 3.

Activity wise additional costs

S No.	Activity	Equipment cost	Personnel salaries	Consumable costs	Total expenditure	% of total expenditure
1	Expenditure on components preparation	Rs 24,91,013	–	Rs 58,05,597	Rs 82,16,610	10
2	Expenditure on NAT testing	Rs 13,22,022	–	Rs 2,56,96,100	Rs 2,70,18,122	31
3	Expenditure on conducting camp	Rs 38,19,174	Rs 3,53,256	Rs 1,40,000	Rs 43,12,430	5

Discussion

The expenditure on blood banks is increasing, reflecting rising cost of health care globally. Different ways have been used for calculating cost of a unit of blood depending on the functioning and the requirements of the blood centre. The present study was done in a blood bank of a tertiary care, central government funded hospital where all the services provided to indoor patients including blood transfusion services are free of cost. Activity wise annual cost of a unit of blood and components was calculated for the year 2018, assuming that all components produced carry equal cost.

Annual unit cost of each component was INR 1829. It included expenditure on all activities routinely performed at the blood bank i.e., in house collection, mandatory testing, NAT testing, component preparation and organization of voluntary blood donation camps. The charges recommended by NBTC are Rs 1050, Rs 300, Rs 300 and Rs 200 for WB/PRBC, FFP, Platelet and cryoprecipitate respectively. NBTC also recommends an additional charge of Rs 1200 for each component if NAT testing is also performed at the blood centre [5]. The unit cost per component found in our study which is inclusive of NAT testing is higher than that recommended by NACO. This could have been due to different methodologies used for calculation. As stated earlier, in our study the total expenditure was divided equally among all the components prepared and as mentioned in the methods section expenditure on infrastructure, building maintenance, office expenses etc. were not included in the study. NACO sets a minimum standard for the charges as it has to be uniformly applied to all types of blood banks across all states. Our annual collection of blood was 20,748 units and component units produced was 47,069 units. Similar costing if done in blood banks collecting lesser number of units annually, would have found a higher cost than that in our study because of principle of economy of scale i.e. cost goes down as the production increases. However a study from US reported that after a certain limit of production, there is diminishing return to scale i.e., cost of production doesn’t decrease as a result of increased production [6].

When the expenditure on NAT testing was excluded, with other activities remaining the same, the annual unit cost of each component was Rs 1255 which was Rs 575 less. As per NBTC guidelines (2017), an additional amount of Rs 1200 is recommended towards charges for NAT testing [5]. NAT is an expensive test and the expenditure on consumables for NAT in our study was Rs 25,696,100.00 i.e., 53.72% of the total consumable cost. Since NAT testing increased the expenses considerably, it would be a feasible option only for the larger blood banks, where the scale of production is large and the expenditure gets distributed among all components. Hence from our study it becomes evident that for smaller blood banks if feasible logistically, centralized testing for NAT would be cost effective.

The cost of a unit of blood excluding the total expenditure on voluntary blood donation camps was INR 1738.00, indicating a saving of INR Rs 91 per unit if all collection was in house (Table 3). A similar finding was reported by Sachdeva et al. [7] who accounted for the expenditure under the heads of fuel consumption, repair and salary of mobile van staff. They found that the additional cost per blood unit incurred by collection using the mobile van was Rs 112. Our study shows that, at 20% collection from camps, the cost rises marginally with the added advantage of having safer blood sourced from non-remunerated voluntary blood donors. However if camp organization becomes the responsibility of the blood banks and 100% collection comes from voluntary camps then this difference in cost would rise substantially. Since several hidden costs like the expenditure incurred by the camp organisers, the cost incurred by the donor would also be factored into the expenditure if calculated from the societal perspective [2]. A study from Malawi, Africa by Antonieta et al. found that centralisation of services, collection of blood from voluntary donors camps would increase the burden of expenditure on the blood centre in developing countries by adding cost of organizing blood donation camp, recruitment of donors, travel cost of donors and distribution of units to hospitals. The cost of unit of blood in their study on hospital based replacement was INR 719.71(US$ 16.28 year 2005) while that on sourcing from camps, the unit cost increased almost three times to INR 2210.41 (US$ 50, year 2005) [8].

In a similar setting with a situation where, only whole blood is used and mandatory testing for TTI (ELISA) is done, the cost of one unit would rise to INR 2521.00, a considerably higher cost (Table 2). This indicates that component separation not only allows its judicious use but at the same time it is cost effective. The additional expenditure on component preparation was Rs 82,16,609.92 which is 9.54% of total expenditure (Table 3) which when divided equally among all components prepared (47,069 units) increased the cost to Rs 174 per unit only.

Several studies from developed countries using the societal perspective for calculation have reported much higher costs as compared to our study (in India). Another reason could be higher cost of infrastructure and maintainance in the developed countries. In a study by A.H. Glennard et al. in 2005 (Sweden) done with societal perspective, the unit cost of allogenic and autologous RBC was INR 14,540 (SEK 3165, year 2005) and INR 12,390 (SEK 2697, year 2005) respectively [3]. Two other studies from Canada and Greece, reported higher costs. Amin et al. in 2002 (Canada), who also included societal costs, foundunit cost of allogenic RBC to be INR 12,872 (US$ 264.81 year 2002) [9] and in a study by Fragoulakis et al. (2013) Greece, the societal unit cost was found to be INR 9522.51 (2013 €131.49) [10].

The unit cost of blood also varies depending upon the organization of the health service system and the blood banking system of a country. In a study by Toner et al. [11] (United States) where supply to the hospital comes from centralised units, the cost of RBC and FFP was INR 9835.24 (2011 US$ 210.74) and INR 2832 (2011 US$ 60.70) respectively. Elizabeth A Stokes et al., did a microcosting of services which included cost of both laboratory inputs (Group and screen, RBC crossmatch and issue, Non-RBC issue and RBC unit transfused, Non-RBC unit transfused) and nursing inputs(cost on blood sampling and requesting blood, administering first blood unit and administering subsequent units)found the cost of RBC, FFP and platelet to be INR 4697.36 (US$ 71 year 2018), INR 3638.80 (US$ 55 year 2018) and INR 5557.44 (US $84 year 2018) respectively [12]. The cost of sourcing RBCs and non-RBCs component as per NICE (National Institute for Health and care Excellence, U.K) guideline was $197.38 (£122.09) and $45.24 respectively [13]. They concluded that sourcing of blood from centralised services increases the cost of component units considerably. Some experts are of the opinion that the centralized system of blood collection and processing will bring uniformity in the present diverse healthcare system in India but whether it would be cost effective and logistically feasible in developing country is debatable. Table 4 shows comparison of the cost of blood components in different countries and the study centre.

Table 4.

Activity wise additional costs

Author/year	Place of study	Definition of unit	Cost/unit	Cost/unit in INR	Costing parameters included in the study	Remarks
Amin et al. [9]	Canada	Allogeneic RBC	US$ 152.17 in 1994 increased to $264.81 in 2002	4784(1994) to 12,872 (2002)	Cost of blood collection, production, distribution, delivery, transfusion reaction management, and opportunity cost of donor’s time were included in the study	Societal cost
Glennard et al. [3]	Sweden	Autologous RBC	SEK 2697	12,390	Cost of donor’s production time, transportation, blood collection, preparation, and transfusion were included in the study	Societal cost Allogenic cost high due to transfusion reaction, administration cost high in autologous
		Allogenic RBC	SEK 3165	14,540
		Intraoperative erythrocyte salvage	SEK 2567	11,792
Lara et al. [8]	Malawi, Africa	One unit blood (not specified)	US$ 16.32	720	Laboratory cost of all blood tests included to produce a unit of safe blood by using family replacement donor	Laboratory cost
Toner et al. [11]	US	RBC	$US 210.74 ± 37.9	9835 ± 1769	Survey of hospital based blood banks done to determine the average price paid by hospitals to suppliers for a unit of red blood cell and other components as well as cost for blood related processes performed	Centralised collection and distribution
		Fresh frozen plasma	$US 60.70 ± 20	2833 ± 933
		Apheresis platelet	$US 553.90 ± 120	25,850 ± 933
Fragoulakis et al. [10]	Greece	One unit blood (not Specified)	Direct cost €131.49	9523	Cost of resources expended for collection, processing, laboratory testing, and storage were included in the study	Societal cost
			Indirect cost €34	2462
Stokes [12]	United Kingdom	RBC	$71(£49)	4697	Transfusion laboratory and nursing service inputs were included in the study	Economic cost
		FFP	$55 (£38)	3639
		PLATELETS	$84 (£58)	5557
NBTC Guidelines [13]	India	Whole Blood	–	1050+ 1450*	Processing charge of blood and blood components	NBTC costing guidelines
		Packed Red Cells	–	1050+ 1450*
		Fresh Frozen Plasma	–	300+ 400*
		Platelet Concentrate	–	300+ 400*
		Cryoprecipitate	–	200+ 250*
		Additional charge on NAT	–	1200
Present study	India	Assumption that all blood components carry equal cost	–	1829	Activity wise unit cost of blood was calculated following WHO guidelines (with NAT)	Economic cost

* Goverment blood banks

⁺Non-government blood banks

In conclusion, cost of running a blood transfusion service is high. Since additional cost incurred on camps with the help of voluntary organisers is marginal, collection from voluntary donation camps must be encouraged. Component separation reduces cost considerably and permits its judicious use in patients with different conditions like, Anemia, Thrombocytopenia and Coagulation defects. Component separation must be made mandatory and a system of sharing of surplus stock between blood banks must be worked out. Our study showed that NAT is an expensive test as expenditure on NAT consumables alone was 1/3rd of the total cost of consumables used in the blood bank. Studies on cost effectiveness of NAT are needed in view of rising costs of blood supply. This study was done in a large public sector blood bank and the results would be applicable to blood banks of similar category.