Objectives. To identify the cost components of laparoscopic nephrectomy (LN) that could be targeted to reduce the cost of the procedure. LN is typically more costly than open nephrectomy (ON) because of longer operative times and the use of disposable equipment.

Methods. We compared the overall cost and individual cost centers for uncomplicated LN (n = 11) and ON (n = 8) at a large metropolitan county hospital. A model was created using the DATA program (TreeAge software, version 3.5) to compare the costs of treatment with either ON or LN. We conducted a series of one-way sensitivity analyses to evaluate the effect of varying individual probabilities and costs. Two-way sensitivity analyses were performed to evaluate the costs of ON and LN while varying the hospital length of stay, operative time, and cost of laparoscopic equipment.

Results. LN was less costly overall than ON by $1211 (P = 0.037), despite significant differences favoring ON in overall operating room costs and operating room supply costs. The cost superiority of LN was a consequence of statistically significant differences in the cost of hospitalization, including room and board, that favored the laparoscopic group. One-way sensitivity analyses showed that LN was less costly if (a) the operative time of LN was less than 281 minutes; (b) the length of hospitalization after LN was less than 5.8 days; (c) the operating room costs for LN were less than $3439; (d) the laparoscopic equipment costs were less than $2129; (e) the ON time exceeded 78 minutes; (f) the length of hospitalization for ON was more than 3.6 days; or (g) the operating room costs for ON were greater than $1333.

Conclusions. The sensitivity analyses enable individual surgeons and institutions to determine the cost impact of ON and LN, given their unique clinical scenarios. At our institution, key cost centers in determining cost effectiveness include length of operating time, hospitalization, and cost of laparoscopic instrumentation for ON and LN. LN is cost effective compared with ON if short operating times and brief length of stays are achieved.