Surgical markup in lung cancer resection, 2015-2020

The objective of this study was to assess procedure markup (charge-to-cost ratio) across lung resection procedures and examine variability by geographic region.

Provider-level data for common lung resection operations was obtained from the 2015 to 2020 Medicare Provider Utilization and Payment Data datasets using Healthcare Common Procedure Coding System codes. Procedures studied included wedge resection; video-assisted thoracoscopic surgery; and open lobectomy, segmentectomy, and mediastinal and regional lymphadenectomy. Procedure markup ratio and coefficient of variation (CoV) was assessed and compared across procedure, region, and provider. The CoV, a measure of dispersion defined as the ratio of the SD to the mean, was likewise compared across procedure and region.

Median markup ratio across all procedures was 3.56 (interquartile range, 2.87-4.59) with right skew (mean, 4.13). Median markup ratio was 3.59 for lymphadenectomy (CoV, 0.51), 3.13 for open lobectomy (CoV, 0.45), 3.55 for video-assisted thoracoscopic surgery lobectomy (CoV, 0.59), 3.77 for segmentectomy (CoV, 0.74), and 3.80 for wedge resection (CoV, 0.67). Increased beneficiaries, services, and Healthcare Common Procedure Coding System score (total) were associated with a decreased markup ratio (P < .0001). Markup ratio was highest in the Northeast at 4.14 (interquartile range, 3.09-5.56) and lowest in the South (Markup ratio 3.26; interquartile range, 2.68-4.02).

We observe geographic variation in surgical billing for thoracic surgery.