Objectives: To estimate the potential for cost reduction in the acute care setting and the required investment in the home care setting of implementing an outpatient/early discharge strategy for operable (stages I and II) breast cancer in Canada.

Methods: Data from a community hospital were augmented by expert knowledge and incorporated into the breast cancer submodel of Statistics Canada's Population Health Model. For the estimated 90% of patients for whom this approach was assumed to be appropriate, the resource utilization for outpatient breast-conserving surgery and 2 days of hospitalization for those women undergoing mastectomy was quantified and costed, as were the appropriate home care services. A 5% readmission rate for complications was assumed. Cost per case, total cost burden, investment in home care, savings in acute care, and net savings were calculated. Sensitivity analyses were performed around readmission rates and home care/surgical follow-up costs. All costs were determined in 1995 Canadian dollars.

Results: The cost of initial treatment for the 15,399 women diagnosed with stages I and II breast cancer in 1995 in Canada was estimated to be $127.6 million. Hospitalization made up 53% of these costs. Under the outpatient/early discharge strategy, the acute care cost of initial breast cancer management could be reduced by $47.2 million, with an investment in home care of $14.5 million ($453 per patient), resulting in an overall net saving of $33 million. Under this strategy, hospitalization would contribute only 21% to the total care cost.

Conclusions: If Canadian surgeons and healthcare administrators were to work together to put in place processes to support ambulatory breast cancer surgery and if resources were redirected to the provision of home-based post-operative care, there would be potential for a large net healthcare saving and preservation of high-quality patient care.