Introduction: While physicians are reimbursed based on CPT coding, hospitals are reimbursed based on Diagnosis Related Group (DRG) codes. This coding does not differentiate between number of levels fused but is impacted by approach (ant/post v ant or post only). The aim of this study is to investigate the impact of both geographic location and practice setting on reimbursement.
Methods: DRG based reimbursement for anterior, posterior and circumferential 1 or more level fusions for deformity at 12 institutions was collected. The reimbursement data was then categorized into academic (AC) vs private (PV) and urban (UR) vs suburban (SU) hospitals. The DRG was selected based off of coding for a deformity surgery.
Results: There were 3 PV and 9 AC practices’ data available for review. AC reimbursement was $45,353 while PV was $29,585 (p=0.019). If significant CC were present AC received $59,541 and $39,281 for PV (p=0.022). With a major complication (MCC) reimbursement increased to $78,188 AC and $52,014 PV (p=0.024). There were 8 UR and 4 RU sites identified. In the UR setting, reimbursement was $44,270 and $35,672 (p=0.21) for RU. With CC the UR sites received $58,182 and RU $47,063 (p=0.21). With a MCC, UR received $76,455 and UR $62,024 (p=0.22). When comparing AC-UR (n=7) to PV-RU (n=2) the cost is 62% higher ($28,530 vs $46066). When comparing a 3 vs 8 day stay no significant changes in reimbursement occurred. A hospital stay of 8 days vs 3 days increased reimbursement by $355/day for AC and $61/day for PV.
Conclusions: Medicare DRG based reimbursement was highest for urban academic institutions. Private suburban hospitals must be more efficient to offset this reimbursement inequity. The number of levels fused and the length of hospital stay has minimal impact on DRG based reimbursement regardless of costs.
Learning Objectives: Hospital DRG reimbursement is a separate system from physician professional coding, billing and collecting. This study investigated the impact of institution affiliation (academic vs. private) and geographic setting (urban vs suburban) on reimbursement and if hospital length of stay affected the amount paid. Academic institutions received significantly more reimbursement than private hospitals while no difference was found between urban and rural hospital settings. Length of stay did not significantly impact reimbursement.