Cost of Surgical Treatment for Distal Radius Fractures and the Implications of Episode-Based Bundled Payments

Abstract

Purpose: To examine the cost of care of surgical treatment for a distal radius fracture (DRF) and develop episodes that may be used to develop future bundled payment programs.

Methods: Using 2009 to 2015 claims data from the Truven MarketScan Databases, we examined the cost of care for surgical treatment of DRFs among adult patients in the United States. We excluded patients with concurrent fractures, patients who required complex care, and patients in assisted living facilities. We extracted data on cost and type of services provided to eligible patients, tracking patients from 3 days prior to operation to 90 days after operation. From these data, we developed 4 episode-of-care scenarios to develop an estimated bundled payment. We computed the variation in cost between surgery types, time periods, and type of service provided.

Results: Our final sample included 23,453 DRF operations, of which 15% were performed on patients 65 years of age or older. The majority (88%) underwent open fixation, the option associated with the highest cost. The average cost of care for a DRF patient ranged from $6,577 to $8,181 depending on the definition of an episode-of-care. Regardless of definition, the variation in cost was high. The cost of surgery itself composed 61% to 91% of the total cost of an episode. Of claims not directly related to the surgery, anesthesia and drugs, imaging, and therapy costs composed the next greatest proportions of the total cost of care.

Conclusions: Many DRF surgical episodes incur substantially higher costs than the average. To maximize cost reduction, bundled payments for DRFs are best designed with a clinically narrow definition that is limited to services related to the fracture and long enough to capture relevant postoperative therapy and imaging costs.

Clinical relevance: This study provides insight on spending to lay the foundation for shifting reimbursement strategies.

Keywords: Bundled payment; cost; distal radius fracture; episode-of-care; surgery.