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Published on: July 5, 2011
Surgeon Reimbursement Unchanged as Hospital Charges and Reimbursements Increase for Total Joint Arthroplasty
Nicole Durig Quinlan1, Dennis Q Chen1, James A Browne1
1Department of Orthopaedic Surgery, University of Virginia, Charlottesville, VA.
Insights
Hospital charges and payments for total hip (THA) and knee arthroplasty (TKA) significantly increased relative to surgeon fees. This trend occurred despite decreasing patient length of stay and stable patient complexity.
Area of Science:
- Orthopedic Surgery
- Health Economics
- Healthcare Policy
Background:
- Healthcare reimbursement faces downward pressure, increasing demand for value and cost reduction.
- Analysis of hospital vs. surgeon charges and payments is crucial for understanding cost dynamics.
- Previous studies have not fully detailed trends in arthroplasty cost multipliers.
Purpose of the Study:
- To analyze trends in hospital charges and payments relative to surgeon charges and payments for total hip arthroplasty (THA) and total knee arthroplasty (TKA) in a Medicare population.
- To evaluate the charge multiplier (CM) and payment multiplier (PM) over time.
- To assess the relationship between these multipliers, patient demographics, comorbidities, and length of stay.
Main Methods:
- Utilized the 5% Medicare sample database (2005-2014).
- Included 56,228 primary THA and 117,698 primary TKA cases.
- Calculated CM (hospital charges/surgeon charges) and PM (hospital payments/surgeon payments); analyzed trends with patient data and length of stay.
Main Results:
- Hospital charges significantly exceeded surgeon charges for both THA and TKA.
- Charge multiplier (CM) increased from 8.7 to 11.5 for THA and 7.9 to 11.4 for TKA (P < .0001).
- Payment multiplier (PM) also increased significantly for both procedures (P < .0001), while length of stay decreased (P < .0001).
Conclusions:
- Hospital charges and payments relative to surgeon fees have substantially increased for THA and TKA.
- This rise occurred despite stable patient complexity (Charlson Comorbidity Index) and decreasing length of stay.
- The findings highlight a growing disparity in cost structures within arthroplasty procedures.
Background:
Despite increasing demands on physicians and hospitals to increase value and reduce unnecessary costs, reimbursement for healthcare services has been under downward pressure for several years. This study aimed to analyze the trend in hospital charges and payments relative to corresponding surgeon charges and payments in a Medicare population for total hip (THA) and knee arthroplasty (TKA).
Methods:
The 5% Medicare sample database was used to capture hospital and surgeon charges and payments related to 56,228 patients who underwent primary THA and 117,698 patients who underwent primary TKA between 2005 and 2014. Two values were calculated: (1) the charge multiplier (CM), the ratio of hospital to surgeon charges and (2) the payment multiplier (PM), the ratio of hospital to surgeon payments. Year-to-year variation and regional trends in patient demographics, Charlson Comorbidity Index, length of stay (LOS), CM, and PM were evaluated.
Results:
Hospital charges were significantly higher than surgeon charges and increased substantially for both THA (CM increased from 8.7 to 11.5, P < .0001) and TKA (CM increased from 7.9 to 11.4, P < .0001). PM followed a similar trend, increasing for both THA and TKA (P < .0001). LOS decreased significantly for both THA and TKA (P < .0001), while Charlson Comorbidity Index remained stable. Both CM (r2 = 0.84 THA, 0.90 TKA) and PM (r2 = 0.75 THA, 0.84 TKA) were strongly negatively associated with LOS.
Conclusion:
Hospital charges and payments relative to surgeon charges and payments have increased substantially for THA and TKA despite stable patient complexity and decreasing LOS.
