A cohort cost analysis of lumbar laminectomy—current trends in surgeon and hospital fees distribution

Background contextSpine-related health-care expenditures accounted for $86 billion dollars in 2005, a 65% increase from 1997. However, when adjusting for inflation, surgeons have seen decreased reimbursement rates over the last decade.PurposeTo assess contribution of surgeon fees to overall procedure cost, we reviewed the charges and reimbursements for a noninstrumented lumbar laminectomy and compared the amounts reimbursed to the hospital and to the surgeon at a major academic institution.Study design/settingRetrospective review of costs associated with lumbar laminectomies.Patient sampleSeventy-seven patients undergoing lumbar laminectomy for spinal stenosis throughout an 18-month period at a single academic medical center were included in this study.Outcome measuresCost and number of laminectomy levels.MethodsThe reimbursement schedule of six academic spine surgeons was collected over 18 months for performed noninstrumented lumbar laminectomy procedures. Bills and collections by the hospital and surgeon professional fees were comparatively analyzed and substratified by number of laminectomy levels and patient insurance status. Unpaired two-sample Student t test was used for analysis of significant differences.ResultsDuring an 18-month period, patients underwent a lumbar laminectomy involving on average three levels and stayed in the hospital on average 3.5 days. Complications were uncommon (13%). Average professional fee billing for the surgeon was $6,889±$2,882, and collection was $1,848±$1,433 (28% overall, 30% for private insurance, and 23% for Medicare/Medicaid insurance). Average hospital billing for the inpatient hospital stay minus professional fees from the surgeon was $14,766±$7,729, and average collection on such bills was $13,391±$7,256 (92% overall, 91% for private insurance, and 85% for Medicare/Medicaid insurance).ConclusionBased on this analysis, the proportion of overall costs allocated to professional fees for a noninstrumented lumbar laminectomy is small, whereas those allocated to hospital costs are far greater. These findings suggest that the current focus on decreasing physician reimbursement as the principal cost saving strategy will lead to minimal reimbursement for surgeons without a substantial drop in the overall cost of procedures performed.