Commercial Price Variation for Breast Reconstruction in the Era of Price Transparency

Implementing a Streamlined Hypoglossal Nerve Stimulator Pathway: Cost, Time to Surgery, and Outcomes

Objective

To evaluate the costs, time to surgery, and clinical outcomes associated with implementing a streamlined hypoglossal nerve stimulator (HGNS) implantation pathway.

Study Design

Retrospective cohort study.

Setting

Single tertiary care center in the United States from 2016 to 2023.

Methods

Patients with a lack of complete concentric collapse of the velum during volitional snore on in-office laryngoscopy qualified for the streamlined HGNS pathway. This pathway consisted of confirmatory drug-induced sleep endoscopy (DISE) followed immediately by HGNS implantation during the same surgical encounter. Outcomes were compared to patients in the traditional pathway (standalone DISE followed by HGNS implantation on a later date).

Results

A total of 68 patients (13 streamlined, 55 traditional) with obstructive sleep apnea who underwent HGNS implantation were included. Patients were predominately male (70.6%) and White (95.6%) and had a mean (SD) age of 63.5 (10.0) years. The streamlined pathway was associated with a significant reduction in both hospital costs (mean difference $9258, 95% confidence interval [CI]: 3690-14,825; P = .002) and time to surgery (mean decrease of 3.82 months, 95% CI: 0.83-6.80 months; P = .013) compared to the traditional pathway. Patients in both groups had reduction in apnea-hypopnea index and Epworth Sleepiness Scale score, with no significant differences in comparisons between groups.

Conclusion

In select patients, the streamlined HGNS pathway may expedite time to surgery and reduce hospital costs with comparable clinical outcomes to a traditional 2-stage pathway. Further research is warranted to validate patient selection and better understand longitudinal outcomes.

Burn Care Funding in the Era of Price Transparency-Does Verification Signal Bargaining Power?

The Price Transparency Rule of 2021 forced payors and hospitals to publicly disclose negotiated prices to foster competition and reduce the cost. Burn care is costly and concentrated at less than 130 centers in the US. We aimed to analyze geographic price variations for inpatient burn care and measure the effects of American Burn Association (ABA) verification status and market concentration on prices. All available commercial rates for 2021-2022 for burn-related diagnosis-related groups (DRGs) 927, 928, 929, 933, 934, and 935 were merged with hospital-level variables, ABA verification status, and Herfindahl-Hirschman Index (HHI) data. For the DRG 927 (most intensive burn admission), a linear mixed effects model was fit with cost as the outcome and the following variables as covariates: HHI, plan type, safety net status, profit status, verification status, rural status, and teaching hospital status. Random intercepts allowed for individual burn centers. There were 170,738 rates published from 1541 unique hospitals. Commercial reimbursement rates for the same DRG varied by a factor of approximately three within hospitals for all DRGs. Similarly, rates across different hospitals varied by a factor of 3 for all DRGs, with DRG 927 having the most variation. Burn center status was independently associated with higher reimbursement rates adjusting for facility-level factors for all DRGs except for 935. Notably, HHI was the largest predictor of commercial rates (P < .001). Negotiated prices for inpatient burn care vary widely. ABA-verified centers garner higher rates along with burn centers in more concentrated/monopolistic markets.

To be or not to be compliant? Hospitals' initial strategic responses to the federal price transparency rule

OBJECTIVE

To understand US hospitals' initial strategic responses to the federal price transparency rule that took effect January 2021.

DATA SOURCES AND STUDY SETTING

Primary interview data collected from 12 not-for-profit hospital organizations in six US metropolitan markets. All but one organization were multihospital systems; the 12 organizations represent a total of 81 hospitals.

STUDY DESIGN

Exploratory, cross-sectional, qualitative interview study of a convenience sample of hospital organizations across six geographically and compliance diverse markets.

DATA COLLECTION/EXTRACTION METHODS

In-depth, semi-structured, qualitative interviews with 16 key informants across sampled organizations between November 2021 and March 2022. Interviews solicited data about internal organizational factors and external market factors affecting strategic responses. Transcribed interviews were de-identified, coded, and analyzed using the constant comparative method.

PRINCIPAL FINDINGS

Hospitals' strategic responses were influenced internally by the degree of the regulation's alignment with organizational values and goals, and task complexity vis-a-vis available resources. We found extensive variation in organizational capabilities to comply, and all but one organization relied on consultants and vendors to some degree. Key external factors driving strategic responses were hospitals' variable perceptions about how available price information would affect their competitive position, bottom line, and reputation. Organizations with more confidence in their interpretation of the environment, including how peers or purchasers would behave, and greater clarity in their own organization's position and goals, had more definitive initial strategic responses. In the first year, organizations' strategic responses skewed toward compliance, especially for the rule's consumer shopping requirements.

CONCLUSIONS

A deeper understanding of the realities of operationalizing price transparency policy for hospitals is needed to improve its impact.

Free Flap Reconstruction in the Era of Commercial Price Transparency: What Are We Paying For?

BACKGROUND

Commercial rates for free flap reconstruction were not known publicly before the 2021 Hospital Price Transparency Final Rule. The purpose of this study was to examine commercial facility payments to characterize nationwide variation for microsurgical operations and identify opportunities to improve market effectiveness.

METHODS

A cross-sectional study was performed using 2022 commercial insurance pricing merged with hospital performance data. Facility payment rates were extracted for nine CPT codes for free flap operations. Price variation was quantified by means of across-hospital ratios and within-hospital ratios. Mixed effects linear models evaluated commercial rates relative to value, outcomes, and equity performance metrics, in addition to facility-level factors that included health care market concentration.

RESULTS

A total of 20,528 commercial rates across 675 hospitals were compiled. Across-hospital ratios ranged from 5.85 to 7.95, whereas within-hospital ratios ranged from 1.00 to 1.71. Compared with the lowest scoring hospitals (grade D), hospitals with an outcome grade of A and equity grades of B or C were associated with higher commercial rates ( P < 0.04); there were no significant differences in rate based on value. Higher commercial rates were also associated with nonprofit status and more concentrated markets ( P < 0.006). Lower commercial rates were correlated with safety-net and teaching hospitals ( P < 0.001).

CONCLUSIONS

Commercial rates for free flaps varied substantially both across and within hospitals. Associations of higher commercial rates with less competitive markets, and the lack of consistent association with value and equity, identify market failures. Additional work is needed to improve market efficiency for free flap operations.

Out-of-Pocket Costs and Payments in Autologous and Implant-Based Breast Reconstruction: A Nationwide Analysis

BACKGROUND

Many factors influence a patient's decision to undergo autologous versus implant-based breast reconstruction, including medical, social, and financial considerations. This study aims to investigate differences in out-of-pocket and total spending for patients undergoing autologous and implant-based breast reconstruction.

METHODS

The IBM MarketScan Commercial Databases were queried to extract all patients who underwent inpatient autologous or implant-based breast reconstruction from 2017 to 2021. Financial variables included gross payments to the provider (facility and/or physician) and out-of-pocket costs (total of coinsurance, deductible, and copayments). Univariate regressions assessed differences between autologous and implant-based reconstruction procedures. Mixed-effects linear regression was used to analyze parametric contributions to total gross and out-of-pocket costs.

RESULTS

The sample identified 2079 autologous breast reconstruction and 1475 implant-based breast reconstruction episodes. Median out-of-pocket costs were significantly higher for autologous reconstruction than implant-based reconstruction ($597 vs $250, P < 0.001) as were total payments ($63,667 vs $31,472, P < 0.001). Type of insurance plan and region contributed to variable out-of-pocket costs (P < 0.001). Regression analysis revealed that autologous reconstruction contributes significantly to increasing out-of-pocket costs (B = $597, P = 0.025) and increasing total costs (B = $74,507, P = 0.006).

CONCLUSION

The US national data demonstrate that autologous breast reconstruction has higher out-of-pocket costs and higher gross payments than implant-based reconstruction. More study is needed to determine the extent to which these financial differences affect patient decision-making.

A comprehensive value-based method for new nuclear medical service pricing: with case study of radium [223Ra] bone metastases treatment

IMPORTANCE

Innovative nuclear medicine services offer substantial clinical value to patients. However, these advancements often come with high costs. Traditional payment strategies do not incentivize medical institutes to provide new services nor determine the fair price for payers. A shift towards a value-based pricing strategy is imperative to address these challenges. Such a strategy would reconcile the cost of innovation with incentives, foster transparent allocation of healthcare resources, and expedite the accessibility of essential medical services.

OBJECTIVE

This study aims to develop and present a comprehensive, value-based pricing model for new nuclear medicine services, illustrated explicitly through a case study of the radium [223Ra] treatment for bone metastases. In constructing the pricing model, we have considered three primary value determinants: the cost of the new service, associated service risk, and the difficulty of the service provision. Our research can help healthcare leaders design an evidence-based Fee-For-Service (FFS) payment reference pricing with nuclear medicine services and price adjustments.

DESIGN, SETTING AND PARTICIPANTS

This multi-center study was conducted from March 2021 to February 2022 (including consultation meetings) and employed both qualitative and quantitative methodologies. We organized focus group consultations with physicians from nuclear medicine departments in Beijing, Chongqing, Guangzhou, and Shanghai to standardize the treatment process for radium [223Ra] bone metastases. We used a specially designed 'Radium Nuclide [223Ra] Bone Metastasis Data Collection Form' to gather nationwide resource consumption data to extract information from local databases. Four interviews with groups of experts were conducted to determine the add-up ratio, based on service risk and difficulty. The study organized consultation meeting with key stakeholders, including policymakers, service providers, clinical researchers, and health economists, to finalize the pricing equation and the pricing result of radium [223Ra] bone metastases service.

MAIN OUTCOMES AND MEASURES

We developed and detailed a pricing equation tailored for innovative services in the nuclear medicine department, illustrating its application through a step-by-step guide. A standardized service process was established to ensure consistency and accuracy. Adhering to best practice guidelines for health cost data analysis, we emphasized the importance of cross-validation of data, where validated data demonstrated less variation. However, it required a more advanced health information system to manage and analyze the data inputs effectively.

RESULTS

The standardized service of radium [223Ra] bone metastases includes: pre-injection assessment, treatment plan, administration, post-administration monitoring, waste disposal and monitoring. The average duration for each stage is 104 min, 39 min, 25 min, 72 min and 56 min. A standardized monetary value for medical consumables is 54.94 yuan ($7.6), and the standardised monetary value (medical consumables cost plus human input) is 763.68 yuan ($109.9). Applying an agreed value add-up ratio of 1.065, the standardized value is 810.19 yuan ($116.9). Feedback from a consultation meeting with policymakers and health economics researchers indicates a consensus that the pricing equation developed was reasonable and well-grounded.

CONCLUSION

This research is the first study in the field of nuclear medicine department pricing methodology. We introduce a comprehensive value-based nuclear medical service pricing method and use radium[223Ra] bone metastases treatment pricing in China as a case study. This study establishes a novel pricing framework and provides practical instructions on its implementation in a real-world healthcare setting.

Negotiated Rates for Surgical Cancer Care in the Era of Price Transparency-Prices Reflect Market Competition

OBJECTIVE

To measure commercial price variation for cancer surgery within and across hospitals.

BACKGROUND

Surgical care for solid-organ tumors is costly, and negotiated commercial rates have been hidden from public view. The Hospital Price Transparency Rule, enacted in 2021, requires all hospitals to list their negotiated rates on their website, thus opening the door for an examination of pricing for cancer surgery.

METHODS

This was a cross-sectional study using 2021 negotiated price data disclosed by US hospitals for the 10 most common cancers treated with surgery. Price variation was measured using within-hospital and across-hospital ratios. Commercial rates relative to cancer center designation and the Herfindahl-Hirschman Index at the facility level were evaluated with mixed effects linear regression with random intercepts per procedural code.

RESULTS

In all, 495,200 unique commercial rates from 2232 hospitals resulted for the 10 most common solid-organ tumor cancers. Gynecologic cancer operations had the highest median rates at $6035.8/operation compared with bladder cancer surgery at $3431.0/operation. Compared with competitive markets, moderately and highly concentrated markets were associated with significantly higher rates (HHI 1501, 2500, coefficient $513.6, 95% CI, $295.5, $731.7; HHI >2500, coefficient $1115.5, 95% CI, $913.7, $1317.2). National Cancer Institute designation was associated with higher rates, coefficient $3,451.9 (95% CI, $2853.2, $4050.7).

CONCLUSIONS

Commercial payer-negotiated prices for the surgical management of 10 common, solid tumor malignancies varied widely both within and across hospitals. Higher rates were observed in less competitive markets. Future efforts should facilitate price competition and limit health market concentration.

Uncovering the interhospital price variations for vasectomies in the United States

Due to the historic lack of transparency in healthcare pricing in the United States, the degree of price variation for vasectomy is largely unknown. Our study aims to assess characteristics of hospitals reporting prices for vasectomy as well as price variation associated with hospital factors and insurance status. A cross-sectional analysis was performed in October, 2022 using the Turquoise Database which compiles publicly available hospital pricing data. The database was queried for vasectomy prices to identify the cash (paid by patients not using insurance), commercial (negotiated by private insurers) and Medicare and Medicaid prices for vasectomies. Hospital characteristics of those that reported a price for vasectomy and those that did not were compared and pricing differences based on hospital ownership and reimbursement source were determined using multivariable linear regression analysis. Overall, only 24.7% (1657/6700) of hospitals reported a price for vasectomy. Those that reported a price had more beds (median 117 vs 80, p < 0.001), more physicians (median 1745 vs 1275, p < 0.001). They were also more likely to be nonprofit hospitals (77% vs 14%, p < 0.001) and to be in well-resourced areas (ADI 91.7 vs 94.4, p < 0.001). Both commercial prices and cash prices for vasectomy were lower at nonprofit hospitals than at for-profit hospitals (commercial: $1959.47 vs $2861.56, p < 0.001; cash: $1429.74 vs $3185.37, p < 0.001). Our study highlights the current state of pricing transparency for vasectomy in the United States. Patients may be counseled to consider seeking vasectomy at a nonprofit hospital to reduce their costs, especially when paying with cash. These findings also suggest a need for new policies to target areas with decreased price transparency to reduce price disparities.

Financial Toxicity in Breast Reconstruction: The Role of the Surgeon-Patient Cost-of-Care Discussion

The financial burden of breast cancer treatment and reconstruction is a significant concern for patients. Patient desire for preoperative cost-of-care counseling while navigating the reconstructive process remains unknown. A cross-sectional survey of women from the Love Research Army was conducted. An electronic survey was distributed to women over 18 years of age and at least 1 year after postmastectomy breast reconstruction. Descriptive statistics and multivariable modeling were used to determine desire for and occurrence of cost-of-care discussions, and factors associated with preference for such discussions. Secondary outcomes included the association of financial toxicity with desire for cost discussions. Among 839 women who responded, 620 women (74.1%) did not speak to their plastic surgeon and 480 (57.4%) did not speak to a staff member regarding costs of breast reconstruction. Of the 550 women who reported it would have been helpful to discuss costs, 315 (57.3%) were not engaged in a financial conversation initiated by a health care provider. A greater proportion of women who reported financial toxicity, compared to those who did not, would have preferred to discuss costs with their plastic surgeon (65.2% vs. 43.5%, p  < 0.001) or a staff member (75.5% vs. 59.3%, p  < 0.001). Among women with financial toxicity, those who had some form of insurance (private, Medicaid, Medicare, "other") were significantly more likely to prefer a cost-of-care discussion ( p  < 0.001, p  = 0.02, p  = 0.05, p  = 0.01). Financial discussions about the potential costs of breast reconstruction seldom occurred in this national cohort. Given the reported preference and unmet need for financial discussions by a majority of women, better cost transparency and communication is needed.

Health Equity Ratings of U.S. Burn Centers-Does For-Profit Status Matter?

Achieving health equity is forefront in national discussions on healthcare structuring. Burn injuries transcend racial and socioeconomic boundaries. Burn center funding ranges from safety-net to for-profit without an understanding of how funding mechanisms translate into equity outcomes. We hypothesized that health equity would be highest at safety-net facilities and lowest at for-profit centers. All verified and non-verified American Burn Association burn centers were collated in 2022. Safety-net status, for-profit status, and health equity rating were extracted from national datasets. Equity ratings were compared across national burn centers and significance was determined with comparative statistics and ordinal logistic regression. On an equity grade of A-D (A is the best), 27.6% of centers were rated A, 27.6% rated B, 41.5% rated C, and 3.3% rated D. About 17.1% of all burn centers were designated as for-profit compared to 21.1% of centers that were safety-net. About 73.1% of safety-net centers scored an A rating, and 14.3% of for-profit centers scored an A rating. Safety-net centers were 21.8 times more likely (P < .001) to have the highest equity score compared to nonsafety-net centers. There was an 80% decrease in the odds of having a rating of A for for-profit centers compared to nonprofit centers (P = .04). Safety-net centers had the highest equity ratings while for-profit burn centers scored the lowest. For-profit funding mechanisms may lead to the delivery of less equitable burn care. Burn centers should focus on health equity in the triage and management of their patients.

Commercial Insurance Rates and Coding for Lymphedema Procedures: The Current State of Confusion and Need for Consensus

BACKGROUND

Surgical treatment of lymphedema has outpaced coding paradigms. In the setting of ambiguity regarding coding for physiologic procedures [lymphovenous bypass (LVB) and vascularized lymph node transplant (VLNT)], we hypothesized that there would be variation in commercial reimbursement based on coding pattern.

METHODS

The authors performed a cross-sectional analysis of 2021 nationwide hospital pricing data for 21 CPT codes encompassing excisional (direct excision, liposuction), physiologic (LVB, VLNT), and ancillary (lymphangiography) procedures. Within-hospital ratios (WHRs) and across-hospital ratios (AHRs) for adjusted commercial rates per CPT code quantified price variation. Mixed effects linear regression modeled associations of commercial rate with public payer (Medicare and Medicaid), self-pay, and chargemaster rates.

RESULTS

A total of 270,254 commercial rates, including 95,774 rates for physiologic procedures, were extracted from 2863 hospitals. Lymphangiography codes varied most in commercial price (WHR, 1.76 to 3.89; AHR, 8.12 to 44.38). For physiologic codes, WHRs ranged from 1.01 (VLNT; free omental flap) to 3.03 (LVB; unlisted lymphatic procedure), and AHRs ranged from 5.23 (LVB; lymphatic channel incision) to 10.36 (LVB; unlisted lymphatic procedure). Median adjusted commercial rates for excisional procedures ($3635.84) were higher than for physiologic procedures ($2560.40; P < 0.001). Commercial rate positively correlated with Medicare rate for all physiologic codes combined, although regression coefficients varied by code.

CONCLUSIONS

Commercial payer-negotiated rates for physiologic procedures were highly variable both within and across hospitals, reflective of variation in CPT codes. Physiologic procedures may be undervalued relative to excisional procedures. Consistent coding nomenclature should be developed for physiologic and ancillary procedures.

Rates of price disclosure associated with the surgical treatment of early-stage breast cancer one year after implementation of federal regulations

PURPOSE

Mastectomy, breast reconstruction (BR) and breast conserving therapy (BCT) are core components of the treatment paradigm for early-stage disease but are differentially associated with significant financial burdens. Given recent price transparency regulations, we sought to characterize rates of disclosure for breast cancer-related surgery, including mastectomy, BCT, and BR (oncoplastic reconstruction, implant, pedicled flap and free flap) and identify associated factors.

METHODS

For this cross-sectional analysis, cost reports were obtained from the Turquoise Health price transparency platform for all U.S. hospitals meeting national accreditation standards for breast cancer care. The Healthcare Cost Report Information System was used to collect facility-specific data. Addresses were geocoded to identify hospital referral and census regions while data from CMS was also used to identify the geographic practice cost index. We leveraged a Poisson regression model and relevant Medicare billing codes to analyze factors associated with price disclosure and the availability of an OOP price estimator.

RESULTS

Of 447 identified hospitals, 221 (49.4%) disclosed prices for mastectomy and 188 42.1%) disclosed prices for both mastectomy and some form of reconstruction including oncoplastic reduction (n = 184, 97.9%), implants (n = 187, 99.5%), pedicled flaps (n = 89, 47.3%), and free flaps (n = 81, 43.1%). Non-profit status and increased market competition were associated with price nondisclosure. 121 hospitals (27.1%) had an out-of-pocket price estimator that included at least one breast surgery.

CONCLUSIONS

Most eligible hospitals did not disclose prices for breast cancer surgery. Distinct hospital characteristics were associated with price disclosure. Breast cancer patients face persistent difficulty in accessing costs.

Mohs Surgery Price Transparency and Variability at Academic Hospitals After the Implementation of the Federal Price Transparency Final Rule

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Comparison of Hospital Online Price and Telephone Price for Shoppable Services

Importance

US hospitals are required to publicly post their prices for specified shoppable services online. However, the extent to which a hospital's prices posted online correlate with the prices they give to a telephone caller is unknown.

Objective

To compare hospitals' online cash prices for vaginal childbirth and brain magnetic resonance imaging (MRI) with prices offered to secret shopper callers requesting price estimates by telephone.

Design, Setting, and Participants

This cross-sectional study included cash online prices from each hospital's website for vaginal childbirth and brain MRI collected from representative US hospitals between August and October 2022. Thereafter, again between August and October 2022, simulated secret shopper patients called each hospital requesting their lowest cash price for these procedures.

Main Outcomes and Measures

We calculated the difference between each hospital's online and phone prices for vaginal childbirth and brain MRI, and the Pearson correlation coefficient (r) between the online and phone prices for each procedure, among hospitals able to provide both prices.

Results

A total of 60 representative US hospitals (20 top-ranked, 20 safety-net, and 20 non-top-ranked, non-safety-net hospitals) were included in the analysis. For vaginal childbirth, 63% (12 of 19) of top-ranked hospitals, 30% (6 of 20) of safety-net hospitals, and 21% (4 of 19) of non-top-ranked, non-safety-net hospitals provided both online and telephone prices. For brain MRI, 85% (17 of 20) of top-ranked hospitals, 50% (10 of 20) of safety-net hospitals, and 100% (20 of 20) of non-top-ranked, non-safety-net hospitals provided prices both online and via telephone. Online prices and telephone prices for both procedures varied widely. For example, online prices for vaginal childbirth posted by top-ranked hospitals ranged from $0 to $55 221 (mean, $23 040), from $4361 to $14 377 (mean $10 925) for safety-net hospitals, and from $1183 to $30 299 (mean $15 861) for non-top-ranked, non-safety-net hospitals. Among the 22 hospitals providing prices both online and by telephone for vaginal childbirth, prices were within 25% of each other for 45% (10) of hospitals, while 41% (9) of hospitals had differences of 50% or more (Pearson r = 0.118). Among the 47 hospitals providing both online and phone prices for brain MRI, prices were within 25% of each other for 66% (31) of hospitals), while 26% (n = 12) had differences of 50% or more (Pearson r = -0.169). Among hospitals that provided prices both online and via telephone, there was a complete match between the online and telephone prices for vaginal childbirth in 14% (3 of 22) of hospitals and for brain MRI in 19% (9 of 47) of hospitals.

Conclusions and Relevance

Findings of this cross-sectional study suggest that there was poor correlation between hospitals' self-posted online prices and prices they offered by telephone to secret shoppers. These results demonstrate hospitals' continued problems in knowing and communicating their prices for specific services. The findings also highlight the continued challenges for uninsured patients and others who attempt to comparison shop for health care.