The Wonders of Life

echnological innovation in health care is an important driver of cost growth. Doctors and patients often embrace new modes of treatment before their merits and weaknesses are fully understood. These technologies can lead to increases in costs, either because they are simply more expensive than previous treatments or because their introduction leads to an expansion in the types and numbers of patients treated. We examined these patterns as they apply to the case of robot-assisted surgery.

Robotic surgical devices allow a surgeon at a console to operate remote-controlled robotic arms, which may facilitate the performance of laparoscopic procedures. Laparoscopic surgery, in turn, is associated with shorter hospital stays than open surgery, as well as with less postoperative pain and scarring and lower risks of infection and need for blood transfusion.

Robotic technology has been adopted rapidly over the past 4 years in both the United States and Europe. The number of robot-assisted procedures that are performed worldwide has nearly tripled since 2007, from 80,000 to 205,000. Between 2007 and 2009, the number of da Vinci systems, the leading robotic technology, that were installed in U.S. hospitals grew by approximately 75%, from almost 800 to around 1400, and the number that were installed in other countries doubled, from 200 to nearly 400, according to Intuitive Surgical, da Vinci's manufacturer.

A wide range of procedures are now performed by means of robot-assisted surgery. Some of these procedures were already being performed laparoscopically before robots were introduced; the introduction of robotic technology affects expenditures associated with such procedures primarily by increasing the cost per procedure. For procedures that were more often performed as open surgeries, the introduction of robots may affect both the cost and the volume of surgeries performed.

Robotic surgical systems have high fixed costs, with prices ranging from $1 million to...