Reaching the medicare allowable threshold in adult spinal deformity surgery: multicenter cost analysis comparing actual direct hospital costs versus what the government will pay.

STUDY DESIGN: Retrospective multicenter cost analysis. OBJECTIVE: To (1) determine if index episode of care (iEOC) costs of Adult Spinal Deformity (ASD) surgeries are below the Medicare Allowable (MA) threshold, and (2) identify variables that can predict iEOC cases that are below MA. Previous studies have suggested that actual direct hospital cost of Adult Spinal Deformity (ASD) surgery is higher than Medicare Allowable (MA) rates, which has become the benchmark reimbursement target for hospital accounting systems. METHODS: From a prospective, multicenter ASD surgical database, patients undergoing long instrumented fusions (> 5 level) with cost data were identified. iEOC cost was calculated utilizing actual direct hospital cost. MA rates were calculated using hospital specific, year-appropriate CMS Inpatient Pricer Payment System. Recursive partitioning identified potentially modifiable variables that can predict iEOC cost < MA. RESULTS: Administrative direct cost data from 210 patients were obtained from 4 of 11 centers. Ninety-five (45%) patients had iEOC cost < MA. There was significant variation across the four centers in both iEOC cost ($56,788-$78,878, p < 0.0001) and reimbursement ($40,623-$91,351, p < 0.0001) across deformity-specific DRGs (453,454,456,457). Academic centers were more likely to have iEOC costs < MA (67.2% vs 8.9%, p < 0.0001). Recursive partitioning (r2 = 0.309) identified rhBMP-2 use of < 24 mg, sagittal plane deformity, a combined anterior/posterior approach, and an SF36-MCS < 39 as predictive for iEOC cost < MA. Performing an anterior/posterior approach reimburses between 14.7% and 121.1% more (2.2-fold) than posterior-only approach. This change in DRG allows iEOC cost to be more likely below the MA threshold. CONCLUSION: There is significant institutional (private vs academic) variation in ASD reimbursement. BMP use, deformity type, approach, and baseline mental health impact ASD surgery cost being below Medicare reimbursement. ASD surgeries with anterior/posterior approaches are in DRGs that can potentially reimburse 2.2-fold the posterior-only surgery, making it more likely to fall below the MA threshold. LEVEL OF EVIDENCE: III.

A cost-effectiveness comparisons of adult spinal deformity surgery in the United States and Japan.

PURPOSE: Information about the cost-effectiveness of surgical procedures for adult spinal deformity (ASD) is critical for providing appropriate treatments for these patients. The purposes of this study were to compare the direct cost and cost-effectiveness of surgery for ASD in the United States (US) and Japan (JP). METHODS: Retrospective analysis of 76 US and 76 JP patients receiving surgery for ASD with ≥2-year follow-up was identified. Data analysis included preoperative and postoperative demographic, radiographic, health-related quality of life (HRQOL), and direct cost for surgery. An incremental cost-effectiveness ratio (ICER) was determined using cost/quality-adjusted life years (QALY). The cost/QALY was calculated from the 2-year cost and HRQOL data. RESULTS: JP exhibited worse baseline spinopelvic alignment than the US (pelvic incidence and lumbar lordosis: 35.4° vs 22.7°, p < 0.01). The US had more three-column osteotomies (50 vs 16%), and shorter hospital stay (7.9 vs 22.7 days) (p < 0.05). The US demonstrated worse postoperative ODI (41.3 vs. 33.9%) and greater revision surgery rate (40 vs 10%) (p < 0.05). Due to the high initial cost and revision frequency, the US had greater total cost ($92,133 vs. $49,647) and cost/QALY ($511,840 vs. $225,668) at 2-year follow-up (p < 0.05). CONCLUSION: Retrospective analysis comparing the direct costs and cost-effectiveness of ASD surgery in the US vs JP demonstrated that the total direct costs and cost/QALY were substantially higher in the US than JP. Variations in patient cohort, healthcare costs, revision frequencies, and HRQOL improvement influenced the cost/QALY differential between these countries.