Study Reveals Outrageous Pricing Variations

How much do spinal implants—the screws, plates and cages used in spinal surgery—cost a hospital? A study, presented at the recent AAOS conference and reported on by Nancy Walsh, staff writer for MedPage Today, found wide differences in what hospitals paid for similar devices. In their study Samuel Bederman, M.D., Ph.D., and Sohrab Pahlavan, M.D., both of the University of California Irvine, examined the hospital purchasing records for a large consortium of academic medical centers across the country. They wanted to find out the differences that exist in the cost of three commonly used spinal implants—pedicle screws, anterior cervical plates and posterior interbody cages.

Walsh reported that, for their study, the two investigators examined 181 records from 45 centers for pedicle screws, 158 records from 41 centers for cervical plates and 102 records from 33 centers for the interbody cages. They discovered that while the mean price of a pedicle screw was $878, the range went from $400 to $1, 843. For anterior cervical plates, the mean price per item was $1, 068, with a range of $540 to $2, 388. And for the interbody cages, the mean was $2, 975, with an almost eight-fold variation in cost for the same device, with ranges from $938 to $7, 200.

Bederman reported that hospitals and manufacturers negotiate their prices, but that hospitals are handicapped by the fact that they are not permitted to share the prices they have agreed on with other medical centers. “One hospital can’t just call up another and ask what they are paying for a specific type of implant in the hope of getting the same price, ” Bederman wrote.

Walsh quoted Bederman as saying, “What is needed today is more transparency in the system. We’re all in this together—hospitals, surgeons, and implant companies. This closed-door policy of no one telling anyone else what implants cost needs to be addressed to reduce some of the variation and to help limit healthcare expenditures overall.”