Spinal Hardware Costs Climb 22% in Two Years

Spinal Hardware Costs Climb 22% in Two Years, CWCI SaysCalifornia’s employers are paying an extra $67.5 million a year in duplicate payments for the hardware used to treat injured workers with severe back injuries, according to a new analysis by the California Workers’ Compensation Institute (CWCI). The estimated total spend in 2010 for implantable hardware is up 22% from the $55 million in payments made under the workers’ comp system just two years earlier.California is an outlier in that it reimburses hospitals directly for the cost of the spinal hardware used in cases covered by workers’ comp. This “pass-through” is in addition to payments under the official medical fee schedule that pay hospitals 120% of Medicare’s inpatient hospital fee schedule. Medicare’s rate already includes consideration for the cost of the hardware.For the average case where implantable hardware is used, CWCI says the pass-through adds $20,137 to the overall cost of each surgery. But the cost is higher in many cases. CWCI says that for 14 different categories of back surgeries, the average cost of the hardware ranges from a low of $13,044 up to $30,574 for the more intensive cases. CWCI says its $67.5 million estimate of system-wide costs should be considered a conservative estimate.The latest study was conducted at the behest of the Senate Committee on Labor and Industrial Relations as it considered the impact of SB 959 — a bill by Sen. Ted Lieu (D-Torrance) that would end the pass-through payments. The bill passed the committee and the full Senate with strong support from employers and organized labor. The bill, which is opposed by medical groups and the hospital industry, is now pending in the Assembly.

(Filed by Brad Cain in San Francisco)

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