1. The Total “Economic Cost” of Primary Total Joint Replacement Surgery in the United States
Ryan M. Graver, MPH; Lisa Da Deppo, PharmD, MPH, MSc; Erik M. Harris, MHA; Shamiram R. Feinglass, MD, MPH, Zimmer, Inc.
Introduction Results Figure 2. Growth in Aggregate National THA Annual Costs Table 1. Mean Costs
$3.00 150K
Published literature has established that total hip and knee arthroplasty are among the most cost A total of 93,717 patient records of primary total hip arthroplasty (THA) and primary total knee 3rd 2nd 1st 1st 2nd 3rd
effective surgical interventions in medicine.1,2,3,4 However, limited data are available, and few studies arthroplasty (TKA) performed from January 1, 2003 and December 21, 2006 were qualified for year pre year pre year pre year post year post year post Total
$2.75 140K procedureA procedureA procedureA procedureB procedureB procedureB
National
have comprehensively investigated the direct costs of both orthopaedic- and non-orthopaedic- analysis. CAGR* = 4.65% Commercial
associated care, longitudinally, for both Medicare and commercial insurance patients.5,6,7,8 $2.50 130K Cost Commercial
• 9,225 patients underwent total hip replacement surgery and 64,492 patients underwent total
2 CAGR* = 1.45% National Total Hip Cohort
knee replacement surgery.
Study Objective $2.25 120K Commercial
Volume
All Causes $8,762 $10,076 $11,475 $37,445 $11,980 $11,307 $91,046
Cost in Billions
• emales comprised the majority of patients undergoing primary total joint replacement (54.9%
F Orthopedic Related $2,461 $3,016 $3,959 $29,121 $4,172 $3,326 $46,055
$2.00 CAGR* = 5.84% 110K
National
Volume
The objective was to report the actual economic burden to Medicare and commercial insurance assoc- hip replacement, 62.6% knee replacement) with a mean age of 65.8 (± 11.9) years at the time Medicare
Total Knee Cohort
iated with the treatment of patients who require primary total hip and knee arthroplasty procedures. of primary hip arthroplasty and 66.6 (± 10.0) years at the time of primary knee arthroplasty. $1.75 100K Cost All Causes $10,443 $11,433 $12,412 $40,164 $14,336 $13,530 $102,317
This research explores the direct economic costs and related healthcare utilization in the United States National Orthopedic Related $3,218 $3,810 $4,222 $30,132 $5,030 $4,324 $50,736
among the 60% Medicare and 35% commercial insurance patient populations undergoing primary THA • xamining the mean combined costs and utilization during the first year post-procedure we
E $1.50 CAGR* = 4.94% 90K Medicare
and TKA.9 observed the following: Volume Medicare
$1.25 80K
°° verage hospital length of stay was 3.67 days for primary THA and 3.70 days for primary TKA.
A
*Compound Annual Growth
Rate (CAGR); the geometric Total Hip Cohort
mean growth rate on an
All Causes $8,135 $9,153 $10,935 $26,550 $11,459 $11,377 $77,609
Materials and Methods
annualized basis
°° uring the entire study period, the total inpatient hospitalization cost for all reasons was
D $1.00 70K
$27,556 for THA and $27,057 for TKA (Figure 1). Orthopedic Related $1,955 $2,264 $2,856 $17,739 $2,685 $2,285 $29,785
$0 60K Total Knee Cohort
Data Source. This study is a retrospective, longitudinal database audit with data derived from °° ealthcare utilization and expenditure increased dramatically in the 1-year post-surgery
H 2003 Cohort 2004 Cohort 2005 Cohort 2006 Cohort
the Thomson Reuters MarketScan® Commercial Claims and Encounters Database (Commercial All Causes $9,579 $9,834 $10,696 $27,206 $12,410 $12,084 $81,808
period due to arthroplasty and arthroplasty-related costs (Table 1).
Database) and Medicare Supplemental and Coordination of Benefits Database (Medicare Database) Orthopedic Related $2,164 $2,446 $2,611 $18,324 $3,047 $2,645 $31,237
°° he mean orthopaedic related hospitalization cost was $19,328 for THA and $18,540 for
T Figure 3. Growth in Aggregate National TKA Annual Costs
from January 1, 2000 through December 31, 2007. TKA cohorts or 70% and 68.5% respectively.
A
B
Includes costs of services rendered prior to the index procedure, for any medcal reason.
Includes costs of services rendered following and including the index procedure, for any medical reason.
$6.00 320K
Claims were selected for patients who underwent arthroplasty procedures, identified using the °° otal pharmaceutical costs were $18,018 for THA and $21,180 for TKA; of which approx-
T
period may be reflective of treatment costs associated with joint replacement complications requiring
ICD-9 procedure codes, 81.51 for primary total hip and 81.54 for primary knee arthroplasty. imately $2,547 or 14.1% was orthopaedic related for THA and $2,904 or 13.7% for TKA. $5.75 CAGR* = 10.91% 300K
National subsequent inpatient hospitalization, such as dislocation.
CAGR* = 5.79% Commercial
Study Population and Sample Selection. For this analysis, patients undergoing total knee and hip • he total national aggregate direct cost of illness for primary THA and TKA in the year of the
T $5.50 280K Cost
CAGR* = 8.67% This analysis was subject to a number of limitations. The results shown were all unadjusted for potential
replacement were examined. index procedure, by payer type, is represented in Figure 2 and Figure 3. Costs were adjusted $5.25 260K National confounders such as age, seriousness of the morbidity status, and co-morbidities. It is important to
to 2007 dollars. Procedure volumes appear to be driving the annual growth in commercial Commercial
Volume note that classification error is possible when relying on diagnosis coding of administrative claims data.
costs for both THA and TKA, while volume appears to account for only half of the Medicare cost
Cost in Billions
• This is an episode-based analysis and a patient could be included in more than one cohort. $5.00 240K
Lastly, this analysis did not consider the well known improvement in quality of life following arthroplasty,
increases observed; likely due to Medicare’s annual adjustment in reimbursement. National
Volume
• nly adult patients in the databases who had at least 12-months of continuous health plan
O $4.75 220K Medicare such as the clinically relevant improvement in outcomes such as pain relief and restoration of function
enrollment in the pre- and post-arthroplasty period, and did not have any diagnosis for bone • t is estimated that the aggregate national direct cost of orthopaedic related care in the year
I Cost in 90%12 of patients receiving these procedures.
$4.50 200K
cancers, were included in this analysis. patients underwent THA increased from $4.1 billion in 2003 to approximately $5 billion in National
2006 and from $7.7 billion in 2003 to $11.3 billion in 2006 for TKA. The inpatient hospital Medicare This analysis represents the first truly population-based examination of orthopaedic expenditure in the
$4.25 CAGR* = 8.70% 180K
• Patients with more than one type of arthroplasty procedure on the index date were excluded. portion averaged 70% for THA and 65% for TKA of the total estimated aggregate costs for each
Volume Medicare and commercial insurance populations. With increasing budgetary pressure and increasing
procedure cohort during the year of the index procedure. $4.00 160K *Compound Annual Growth numbers of elderly patients who may be seeking these surgeries to relieve their hip and knee problems,
• or the cost and utilization analysis, episodes were assigned to cohorts depending on the year
F Rate (CAGR); the geometric
mean growth rate on an
reliable and objective quantification of the economic and epidemiologic characteristics of these
annualized basis
of the index arthoplasty, 2003-2006. Figure 1. Combined Medicare Commercial Direct Costs During Study Period
$3.75 140K
surgeries is critically needed.
$3.50 120K
Cost and Utilization Variables. The data endpoints were segmented into orthopaedic-related vs. non-
orthopaedic-related care for both inpatient and outpatient claims. Cost variables analyzed include:
$100,000
Total Hip
$100,000
Total Knee
2003 Cohort 2004 Cohort 2005 Cohort 2006 Cohort Bibliography
hospital access, in-patient hospital stay, orthopaedic procedures, medications, outpatient drug 1
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Hospital+ $27,057 5
I
orio R, Healy WL, Richards JA. Comparison of the hospital cost of primary and revision total hip arthroplasty after cost containment. Orthopedics 1999;22(2):185.
This analysis demonstrates that the healthcare costs for patients with joint replacement in the year of
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upta S, Hawker GA, Laporte A, Croxford R, Coyte PC. The economic burden of disabling hip and knee osteoarthritis (OA) from the perspective of individuals living with this
6
Hospital+ $27,556 the surgery are higher than in the years pre-surgery. Cost and utilization patterns were as expected: the condition. Rheumatology 2005;44(12):1531.
third party Medicare and commercial payers. Costs were adjusted to December 2007 dollars by Rehabilitation
higher cost and utilization during the 1-year post-surgery period reflects the arthroplasty and related
7
T
ien WC, Kao HY, Tu YK, Chiu HC, Lee KT, Shi HY. A population-based study of prevalence and hospital charges in total hip and knee replacement.
$1,514 Int Orthop 2009;33(4):949-54.
multiplying each year’s cost by the Medical Care Consumer Price Index.10 Rehabilitation MD $9,252 care being included in this time frame. 8
A
ntoniou J, Martineau PA, Filion KB et al. In-hospital cost of total hip arthroplasty in Canada and the United States. J Bone Joint Surg Am 2004;86(11):2435.
$1,081
MD $8,941 9
A
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Accessed 2009 Mar 1.
Drugs $21,180 The post-surgery period utilization was as expected for orthopaedic procedures, the percentage of patients 10
Bureau of Labor Statistics. Consumer price index detailed report information. http://www.bls.gov/cpi/cpi_dr.htm. Accessed 2009 Mar 1.
Drugs $18,018 receiving physical and occupational therapy services or visiting physical medicine/rehab specialists M
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11
12
Jeffrey N Katz, Total joint replacement in osteoarthritis. Best Practice Research Clinical Rheumatology Vol. 20, No. 1, pp. 145–153, 2006
after surgery appears to be lower than anticipated.
Of note, orthopaedic specific inpatient hospital costs observed in the 2- to 3-year post-surgery period
Acknowledgments
Other¨ $24,888 Other¨ $28,169
were higher than in the three years prior to the joint replacement procedure, averaging $698 for the Dan Huse, PhD, Vice President, Health Care Division, Thomson Reuters, Inc.
+ Implant related costs included in Hospital costs for both THA TKA.
$0 $0
THA cohort and $890 for the TKA cohort. These higher costs observed in the 2- to 3-year post-surgery
¨ Other costs include all medical expenses reimbursed by insurance not categorized in Figure 1, including but not limited to; x-ray, MRI, chiropractic care, etc. MarketScan® is a trademark of Thomson Reuters (Healthcare) Inc.
© 2010 Zimmer, Inc. 1002-AE13 2/25/2010 LL