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Background: A poor understanding of cost among healthcare providers may contribute to high healthcare expenditures. Currently, it is unclear whether and how much surgeons know about the costs of implantable medical devices (IMDs)., Questions/purposes: We (1) determined the level of comfort with orthopaedic IMD costs among orthopaedic residents and attending surgeons, (2) quantified how accurately surgeons understand the costs of orthopaedic IMDs, and (3) identified which constructs yield the most accurate cost estimations among residents and attending surgeons., Methods: A questionnaire was presented to 60 residents and 37 attending orthopaedic surgeons from two large academic medical centers. Respondents estimated the cost of 13 commonly used orthopaedic devices. Fifty-one surgeons participated (36 residents, 15 attending surgeons), for an overall response rate of 53%. Cost estimates were compared against the actual material costs, and we recorded the percentage error for each estimate., Results: More than ½ of the respondents rated their knowledge of IMD cost as poor. The mean percentage error in estimation for all respondents was 69% (range, 29%-289%). Overall, 67% of responses were underestimations and 33% were overestimations. Residents demonstrated a mean percentage error of 73% (range, 29%-289%) while attending surgeons had a mean percentage error of 59% (range, 49%-79%). Residents and attending surgeons demonstrated differences in accuracy within groups and between groups based on the IMD being estimated., Conclusions: We found the knowledge of orthopaedic IMD costs among the orthopaedic residents and attending surgeons surveyed was poor. Further investigation of how physicians conceptualize material costs will be important to healthcare cost control.

Background: Growing prostheses accommodate skeletally immature patients with bone tumors undergoing limb-preserving surgery. Early devices required surgical procedures for lengthening; recent devices lengthen without surgery. Expenses for newer expandable devices that lengthen without surgery are more than for their predecessors but overall reimbursement amounts are not known., Questions/purposes: We sought to determine reimbursement amounts associated with lengthening of growing prostheses requiring surgical and nonsurgical lengthening., Methods: We retrospectively reviewed 17 patients with growing prostheses requiring surgical expansion and eight patients with prostheses capable of nonsurgical expansion. Insurance documents were reviewed to determine the reimbursement for implantation, lengthening, and complications. Growth data were obtained from the literature., Results: Mean reimbursement amounts of surgical and nonsurgical lengthenings were $9950 and $272, respectively. Estimated reimbursements associated with implantation of a growing prosthesis varied depending on age, sex, and location. The largest difference was found for 4-year-old boys with distal femoral replacement where reimbursement for expansion to maturity for surgical and nonsurgical lengthening prostheses would be $379,000 and $208,000, respectively. For children requiring more than one surgical expansion, net reimbursements were lower when a noninvasive lengthening device was used. Annual per-prosthesis maintenance reimbursements to address complications for surgical and nonsurgical lengthening prostheses were $3386 and $1856, respectively., Conclusions: This study showed that reimbursements for lengthening of growing endoprostheses capable of nonsurgical expansion may be less expensive in younger patients, particularly male patients undergoing distal femur replacement, than endoprostheses requiring surgical lengthening. Longer outcomes studies are required to see if reimbursements for complications differ between devices., Level of Evidence: Level III, economic and decision analysis. See the Guidelines for Authors for a complete description of levels of evidence.

Total joint arthroplasty is a successful surgical treatment for painful, arthritic hips and knees. The prevalence of total joint arthroplasty is increasing, and it is consuming an increasing proportion of health care dollars. Payers, especially Centers for Medicare and Medicaid Services, have targeted total joint arthroplasty for cost control, and joint implants, the greatest expense in total joint arthroplasty, have been identified as an opportunity for cost control. Hospitals seek to control the cost of joint implants because the rate of increase in the price of implants is rising faster than the rate of increase in hospital payment for total joint arthroplasty. As joint implants consume more of the hospital payment for total joint arthroplasty, hospitals are encouraging surgeons to use less expensive implants. Several methods for controlling the cost of implants have been described, but no method has succeeded without the cooperation and involvement of surgeons. Gainsharing programs may help align the incentives of hospitals and surgeons relative to the selection and cost of implants. We have implemented a Single-price/Case-price Purchasing program with considerable savings on the cost of implants without adversely affecting the patient outcome of total joint arthroplasty.

During the 1980s, the hospital cost for total hip arthroplasty was controlled, but the implant cost for total hip arthroplasty was not controlled. With the introduction and acceptance of case price payment systems, hip implant cost consumed a greater portion of the hospital payment each year during the 1980s. Cost control for total hip arthroplasty during the 1990s will require control of implant costs. One objective method for controlling implant costs in total hip arthroplasty is implant standardization.

To help balance the operating budget of The Hospital for Special Surgery, which was encountering an annual major deficit of $4 million in 1989, a program of cost awareness leading to cost containment was instituted in 1990. Costs of supplies, implants, and equipment were identified and reviewed by the hospital staff, including orthopaedic surgeons, orthopaedic residents, health care personnel, and administration, for cost effectiveness. Methods to accomplish the goals included structuring committees for information; workshops organized by different services to affect change; feedback to health care professionals through posters and newsletters; and statistical identification for continued education. Major cost savings resulted from recycling wasted implants, reduction of costly implants, and reduction of unnecessary supplies. As a result, vendors had been challenged, leading to more competitive prices. This program has opened new avenues of cost reduction without sacrificing quality of medical care and has contributed to a breakdown of barriers between medical staff, administration, and finance, leading to a strong hospital-team commitment. The price of health care in the United States in 1993 exceeded $900 billion. Health care expenditures now account for approximately 14% of the gross domestic product. Health care costs have been rising faster than the inflation rate for more than a decade. The result is the current national focus on containment of health care expenditures.

The cost of health care in the United States has been rising steadily during the past 10 years. Total joint arthroplasty, a commonly performed orthopaedic procedure, accounts for approximately $10 billion dollars per year. The objective of this study was to perform a clinician-oriented cost analysis of primary and revision hip and knee arthroplasty. Twenty-five consecutive cases each of total knee arthroplasty, total hip arthroplasty, revision total knee arthroplasty, and revision total hip arthroplasty were analyzed. The length of stay and number of minutes spent in the operating room were significantly higher for the patients with revision hip surgery than for the other groups. The total charges for the prosthesis in the 4 groups exceeded 40% of the total charges for the procedure. Primary hip and knee surgery had similar billed costs, and work for revision hip surgery has a significantly higher billed cost than physician's work. The implant selection process by an orthopaedic surgeon performing arthroplasty of the hip and knee needs to include economic aspects.

To decrease implant costs for total hip arthroplasty, a number of different options are available, including the use of remaindered implants, older designs, discounted stock, or specifically designed implants manufactured and sold at low cost. To determine the prevalence of these practices, 80 questionnaires were mailed to members of the Hip Society; 55 (79%) were completed and returned. In addition, 32 questionnaires were mailed to a representative group of orthopaedic surgeons in Canada; 29 (90%) were completed and returned. Analysis of these returns revealed that 73% of the respondents used a low-cost prosthesis for certain indications in total hip arthroplasty. No uniform policy with regard to cost containment or to the definition of low cost was apparent. In a parallel study, the results of a clinical trial with a generic hip implant in 150 patients observed for 2 years or longer revealed the general improvement in hip scores and the rate of complication to be compatible with those of other, more-expensive hip prostheses. Control of prosthetic costs as a means of influencing the cost of arthroplasty appears to be a wide-spread practice.