5 Points on the Economic Impact of Orthopedic Surgery

Practice Management

Treatment for orthopedic injuries and conditions can have a huge economic impact on individuals as well as society. However, untreated orthopedic injuries and conditions often leave people unable to work, placing additional economic strain on patients and families. At the American Academy of Orthopaedic Surgeons Annual Meeting 2013, Past President John R. Tongue, MD, moderated the Presidential Symposium titled "The Economic Value of Orthopaedic Surgery." Symposium faculty included Min Kocher, MD, Lane Koenig, MD, William Martin, MD, Chad Mather, MD, Pete Mandel, MD, Steve Ross, MD, and Mike Schafer, MD. "With this heightened focus on value in healthcare, providers must be able to quantify and communicate the value of their services, where value payors (public and private) and employers may reduce reimbursements or limit access to services in an effort to control spending, without a clear understanding of the implications for patients or for the broader economy," states the symposium's handout.

KNG Health Consulting was commissioned to conduct a study on the societal and economic value of musculoskeletal care with its partner, IHS Global Insight, by AAOS. The panel covered five areas to describe the economic impact of musculoskeletal treatment:

1. Knee osteoarthritis:
The report found total knee arthroplasty increases lifetime direct costs by $20,704 on average when compared with non-surgical treatment. However, these costs are offset by "societal savings from reduced indirect costs equal to $40,632" according to the report. In all, the lifetime societal net benefit for patients undergoing total knee arthroplasty averaged around $19,928. The report also found 85 percent of the savings originate from increased earnings while the other 15 percent come from fewer missed work days and lower disability payments.

2. Hip fractures:
There was a reported lifetime total societal savings of $60,000 per patient from surgical repair for displaced intracapsular and extracapsular hip fractures in 2009, according to the report. The surgical repair also reported higher QALY when compared with non-surgical treatment, which translated to an additional $18 billion in societal savings in 2009. The report also broke out the estimated total societal savings for the elderly population from surgical hip fracture repair, which was estimated at $15 billion in 2009.

3. Disc herniation:
Patients who underwent discectomy for disc herniation had an increased QALY, but also increased direct medical cost of $14,202 on average, according to the report. However, these costs were offset by societal benefits of $24,024, including $23,121 from higher rate of employment and income. Around $606 came from fewer missed work days. The net societal savings per person who underwent discectomy was $9,822 during a four-year period, and the authors of the report estimated discectomy for disc herniation could "generate a total net societal savings of $2.1 billion" when compared with non-surgical treatment.

4. Rotator cuff repair:
Societal savings from surgical treatment of rotator cuff repair was $16,409 in 2012 dollars when compared with non-surgical treatment, according to the report. The savings for patients younger than 40 years old was reported as $71,088 on average, and societal savings for patients under 63 years old was positive. The report estimated $4.1 billion in lifetime societal savings from around 250,000 rotator cuff repairs performed in 2009 in the United States, and patients also reported improved lifetime QALY after surgical treatment.

5. ACL repair:
The report found that surgical treatment less costly and more effective than rehabilitation for ACL repair in the short term. Average lifetime cost to society for patients undergoing ACL repair was $38,121, compared with lifetime costs for rehabilitation reported as $88,538. The report noted an average societal savings of $50,417 for ACL repair and improved QALY versus rehabilitation.

More Articles on Orthopedic Surgery:

Pioneering CMS Bundled Payments for Joint Replacement: Q&A With Dave Wold of Illinois Bone & Joint Institute

5 Healthcare Trends to Watch for Orthopedic Surgeons

Hip Arthroscopy Complication Rate Might be Higher Than Initially Thought

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