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The optimal anesthetic technique for outpatient knee arthroscopy remains controversial. In this study, we evaluated surgical operating conditions, patient satisfaction, recovery times, and postoperative analgesic requirements associated with psoas compartment block, general anesthetic, or spinal anesthetic techniques. Sixty patients were randomized to receive a propofol/nitrous oxide/fentanyl general anesthetic, spinal anesthesia with 6 mg of bupivacaine and 15 μg of fentanyl, or psoas compartment block with 40 mL of 1.5% mepivacaine. All patients received IV ketorolac and intraarticular bupivacaine. The frequency of postanesthesia recovery room admission was 13 (65%) of 20 for patients receiving general anesthesia, compared with 0 of 21 for patients receiving spinal anesthesia and 1 (5%) of 19 for patients receiving psoas block (P < 0.001). The median time from the end of surgery to meeting hospital discharge criteria did not differ across groups (131, 129, and 110 min for general, spinal, and psoas groups, respectively). In the hospital, 45% of general anesthesia patients received opioid analgesics, compared with 14% of spinal anesthesia and 21% of psoas block patients (P = 0.087). There was no difference among groups with respect to the time of first analgesic use or the number of patients requiring opioid analgesia. Pain scores were highest in patients receiving general anesthesia at 30 min (P = 0.032) and at 60, 90, and 120 min (P < 0.001). Patient satisfaction with anesthetic technique (P = 0.025) and pain management (P = 0.009) differed significantly across groups; patients receiving general anesthesia reported lower satisfaction ratings. We conclude that spinal anesthesia or psoas block is superior to general anesthesia for knee arthroscopy when considering resource utilization, patient satisfaction, and postoperative analgesic management.