Variability in Medicaid Reimbursement in Hand Surgery May Lead to Inequality in Access to Patient Care

Direct Variable Cost Comparison of Endoscopic Versus Open Carpal Tunnel Release: A Time-Driven Activity-Based Costing Analysis

INTRODUCTION

To improve the delivery of value-based health care, a deeper understanding of the cost drivers in hand surgery is warranted. Time-driven activity-based costing (TDABC) offers a more accurate estimation of resource utilization compared with top-down accounting methods. This study used TDABC to compare the facility costs of open carpal tunnel release (OCTR) and endoscopic carpal tunnel release (ECTR).

METHODS

We identified 845 consecutive, unilateral carpal tunnel release (516 open, 329 endoscopic) surgeries performed at an orthopaedic specialty hospital between 2015 and 2021. Itemized facility costs were calculated using a TDABC algorithm. Patient demographics, comorbidities, surgical characteristics, and itemized costs were compared between OCTR and ECTR. Multivariate regression was used to determine the independent effect of endoscopic surgery on true facility costs.

RESULTS

Total facility costs were $352 higher in ECTR compared with OCTR ($882 versus $530). ECTR cases had higher personnel costs ($499 versus $420), likely because of longer surgical time (15 versus 11 minutes) and total operating room time (35 versus 27 minutes). ECTR cases also had higher supply costs ($383 versus $110). Controlling for demographics and comorbidities, ECTR was associated with an increase in personnel costs of $35.74 (95% CI, $26.32 to $45.15), supply costs of $230.28 (95% CI, $205.17 to $255.39), and total facility costs of $265.99 (95% CI, $237.01 to $294.97) per case.

DISCUSSION

Using TDABC, ECTR was 66% more costly to the facility compared with OCTR. To reduce the costs related to endoscopic surgery, efforts to decrease surgical time and negotiate lower ECTR-specific supply costs are warranted.

LEVEL OF EVIDENCE

Economic and Decision Analysis Level II.

Wide-Awake Carpal Tunnel Release in the United States: Trends in Volume and Reimbursement by Operative Setting

BACKGROUND

Office-based surgery can increase logistical and financial efficiency for patients and surgeons. The current study compares wide-awake, office-based carpal tunnel release to wide-awake operations performed in the operating room in terms of volume, financial burden, narcotic prescriptions, and adverse events.

METHODS

Operations performed under local-only anesthesia from 2010 to 2020 were identified in a national administrative database (PearlDiver). Patients were grouped by surgical setting and matched based on age, sex, comorbidity burden, and geographic region. Primary endpoints included total disbursement and physician reimbursement, and 30-day narcotics prescriptions, emergency department (ED) visits, and surgical site infections (SSIs).

RESULTS

Before matching, there were 303,741 operating room operations and 5463 office operations. From 2010 to 2020, the percentage of operations in the office increased from 1.2% to 3.4%. Matched cohorts included 21,835 operating room operations and 5459 office operations. Office surgery was associated with lower total disbursement and physician reimbursement for patients with commercial insurance, Medicaid, and Medicare. Linear regression modeling indicated that office-based surgery was significantly associated with lower total disbursement and physician reimbursement. Fewer office patients filled narcotic prescriptions and visited the ED, and there was no difference in SSIs.

CONCLUSIONS

Compared with operating room surgery, office surgery was associated with lower financial burden, fewer narcotics prescriptions and ED visits, and a similar incidence of SSIs. These findings, together with literature showing greater efficiency in the office, suggest that office-based operations are safe and cost-effective and should continue to grow.

CLINICAL QUESTION/LEVEL OF EVIDENCE

Therapeutic, III.

Tiny patients, huge impact: a call to action

The continuation of high-quality care is under threat for the over 70 million children in the United States. Inequities between Medicaid and Medicare payments and the current procedural-based reimbursement model have resulted in the undervaluing of pediatric medical care and lack of prioritization of children's health by institutions. The number of pediatricians, including pediatric subspecialists, and pediatric healthcare centers are declining due to mounting financial obstacles and this crucial healthcare supply is no longer able to keep up with demand. The reasons contributing to these inequities are clear and rational: Medicaid has significantly lower rates of reimbursement compared to Medicare, yet Medicaid covers almost half of children in the United States and creates the natural incentive for medical institutions to prioritize the care of adults. Additionally, certain aspects of children's healthcare are unique from adults and are not adequately covered in the current payment model. The result of decades of devaluing children's healthcare has led to a substantial decrease in the availability of services, medications, and equipment needed to provide healthcare to children across the nation. Fortunately, the solution is just as clear as the problem: we must value the healthcare of children as much as that of adults by increasing Medicaid funding to be on par with Medicare and appreciate the complexities of care beyond procedures. If these changes are not made, the high-quality care for children in the US will continue to decline and increase strain on the overall healthcare system as these children age into adulthood.

Are Patient Demographics and Payor Status Associated With Practice Patterns in the Surgical Management of Carpal Tunnel Syndrome?

BACKGROUND

Open carpal tunnel release (OCTR) and endoscopic carpal tunnel release (ECTR) are the 2 operative approaches used to treat carpal tunnel syndrome (CTS). This study aims to identify whether differences between OCTR and ECTR rates exist, and, if so, are these differences associated with patient demographics or hospital characteristics.

METHODS

The 2018 Nationwide Ambulatory Surgery Sample (NASS) was filtered for patient encounters including either OCTR or ECTR operations. All patients undergoing either OCTR or ECTR were included, regardless of surgical specialty. Patient demographics and hospital characteristics data, provided and predefined by the NASS database, were collected and compared between the 2 treatment groups.

RESULTS

A total of 180 740 patient encounters were collected for both procedure types (OCTR: 62.4% women, mean age, 58 years; ECTR: 62.2% women, mean age, 58 years). Patients from lower income zip codes were more likely to undergo OCTR (P < .001). Patients either self-paying (P < .008) or covered by Medicare (P < .001) or Medicaid insurance (P < .001) were also more likely to undergo OCTR. In contrast, patients who received care at academic centers and centers with >300 beds were more likely to undergo ECTR (P < .001). Patients <65 years old were more likely to undergo ECTR (P < .001), and patients > 75 years old were more likely to undergo OCTR (P < .001). In addition, ECTR was found to be more expensive, with average total charges $1568 greater than charges for OCTR (P < .001).

CONCLUSIONS

Significant differences exist in treatment strategies for CTS and are related to patient income, location, and primary payor status. Differences in OCTR and ECTR rates are also present, and are related to the size and academic status of hospitals.

Identifying High Direct Variable Costs of Open Carpal Tunnel Release Patients Using Time-Driven Activity-Based Costing

PURPOSE

To improve value in health care delivery, a deeper understanding of the cost drivers in hand surgery is necessary. Time-driven activity-based costing (TDABC) more accurately reflects true resource use compared with traditional accounting methods. This study used TDABC to explore the facility cost of carpal tunnel release and identify preoperative characteristics of high-cost patients.

METHODS

Using TDABC, we calculated the facility costs of 516 consecutive patients undergoing open carpal tunnel release at an orthopedic specialty hospital between 2015 and 2021. Patients in the top decile cost were defined as high-cost patients. Multivariable logistic regression was used to determine preoperative characteristics (age, sex, body mass index, race, ethnicity, Elixhauser comorbidity index, American Society of Anesthesiology score, preoperative Disabilities of the Arm, Shoulder and Hand score, Short-Form 12, and anesthesia type) independently associated with high-cost patients.

RESULTS

Surgery-related personnel costs were the main driver (38.0%) of total facility costs, followed by preoperative personnel costs (21.3%). There was a 1.8-fold variation in facility cost between patients in the 90th and 10th percentiles ($774.69 vs $431.35), with the widest cost variations belonging to medication costs ($17.67 vs $1.85; variation, 9.6-fold) and other supply costs ($213.56 vs $65.56; variation, 3.3-fold). Using multivariable regression, predictors of high cost were patient age and use of general anesthesia. Total facility costs correlated strongly with the total operating room time and incision to closure time.

CONCLUSIONS

Efforts to decrease operating room time may translate into reduced personnel costs and greater cost savings. Multidisciplinary initiatives to control medication expenses for patients at risk of high costs may narrow the existing variation in costs.

TYPE OF STUDY/LEVEL OF EVIDENCE

Economic and Decision Analysis II.

Inflation-Adjusted Medicare Reimbursement for Revision Hip Arthroplasty: Study Showing Significant Decrease from 2002 to 2019

BACKGROUND

Investigations into reimbursement trends for primary and revision arthroplasty procedures have demonstrated a steady decline over the past several years. Revision total hip arthroplasty (rTHA) due to infection (rTHA-I) has been associated with higher resource utilization and complexity, but long-term inflation-adjusted data have yet to be compared between rTHA-I and rTHA due to aseptic complications (rTHA-A). The present study was performed to analyze temporal reimbursement trends regarding rTHA-I procedures compared with those for rTHA-A procedures.

METHODS

The Centers for Medicare & Medicaid Services (CMS) Physician Fee Schedule Look-Up Tool was used to extract Medicare reimbursements associated with 1-stage and 2-stage rTHA-I as well as 1-stage rTHA-A procedures from 2002 to 2019. Current Procedural Terminology (CPT) codes for rTHA were grouped according to the American Academy of Orthopaedic Surgeons coding reference guide. Monetary values were adjusted for inflation using the consumer price index (U.S. Bureau of Labor Statistics; reported as 2019 U.S. dollars) and used to calculate the cumulative and average annual percent changes in reimbursement.

RESULTS

Following inflation adjustment, the physician fee reimbursement for rTHA-A decreased by a mean [and standard deviation] of 27.26% ± 3.57% (from $2,209.11 in 2002 to $1,603.20 in 2019) for femoral component revision, 27.41% ± 3.57% (from $2,130.55 to $1,542.91) for acetabular component revision, and 27.50% ± 2.56% (from $2,775.53 to $2,007.61) for both-component revision. Similarly, for a 2-stage rTHA-I, the mean reimbursement declined by 18.74% ± 3.87% (from $2,063.36 in 2002 to $1,673.36 in 2019) and 24.45% ± 3.69% (from $2,328.79 to $1,755.45) for the explantation and reimplantation stages, respectively. The total decline in physician fee reimbursement for rTHA-I ($1,020.64 ± $233.72) was significantly greater than that for rTHA-A ($580.72 ± $107.22; p < 0.00001).

CONCLUSIONS

Our study demonstrated a consistent devaluation of both rTHA-I and rTHA-A procedures from 2002 to 2019, with a larger deficit seen for rTHA-I. A continuation of this trend could create substantial disincentives for physicians to perform such procedures and limit access to care at the population level.

LEVEL OF EVIDENCE

Economic and Decision Analysis Level IV. See Instructions for Authors for a complete description of levels of evidence.