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Published on: November 6, 2015
A Multistate Analysis of Prosthetic and Orthotic Coverage Clarification: Projected Positive Return on Investment and
Shaneis Morse1, Prateek Grover2, Jeff Cain3
1Upstream Informatics LLC, Lakewood, CO 80215, USA.
Background:
Orthotic and prosthetic devices for general-use and activity-specific function can provide critical preventive health benefits for individuals with limb loss, limb difference, and mobility impairments, and yet coverage remains inconsistent across U.S. states.
Objective:
To evaluate the fiscal impact of clarifying insurance coverage for orthotic and prosthetic devices across 23 states lacking comprehensive coverage.
Methods:
A cost consequence analysis was conducted using data from the U.S. Census Bureau, Kaiser Family Foundation, Government Accountability Office, and a recent actuarial analysis informing baseline cost, coverage, and prevalence assumptions. Per-member-per-month (PMPM) cost increases were compared against device enabled preventive health savings to estimate net fiscal impact. Sensitivity analyses modeled three scenarios based upon a combination of uptake (% eligible individuals accessing device) and physical activity equivalent annual cost saving, respectively: conservative (25% uptake, $1000), moderate (50% uptake, $2500), and high-impact (75% uptake, $5000). Return on investment (ROI) was calculated for the moderate scenario as the ratio of annual savings to implementation cost.
Results:
Under the assumptions of the moderate scenario, projected ROI remained positive across all states, ranging from approximately 1.5× in Florida to over 114× in Vermont, with 78% of states (18 of 23 states) demonstrating returns greater than 4×. Moderate scenario annual net savings ranged from approximately $10.8 million in Vermont to $437.0 million in California, with substantial projected savings also observed in Florida ($235.5 million), New York ($225.2 million), and Virginia ($143.8 million). PMPM cost increases for 70% of states range between $0.03 and $0.43, with all modeled states remaining below $1.46.
Discussion:
In our healthcare system dominated by high-cost and reactive care, the ROI obtained by this cost-consequence analysis (CCA) using evidence-based assumptions supports orthotic and prosthetic coverage clarification as preventive interventions to restore function.
