The Effect of Severity of Illness on Spine Surgery Costs Across New York State Hospitals: An Analysis of 69,831 Cases.

STUDY DESIGN: Observational database review.

OBJECTIVE: To determine the effect of patient severity of illness (SOI) on the cost of spine surgery among New York state hospitals.

SUMMARY OF BACKGROUND DATA: National health care spending has risen at an unsustainable rate with musculoskeletal care, and spine surgery in particular, accounting for a significant portion of this expenditure. In an effort towards cost-containment, health care payers are exploring novel payment models some of which reward cost savings but penalize excessive spending. To mitigate risk to health care institutions, accurate cost forecasting is essential. No studies have evaluated the effect of SOI on costs within spine surgery.

MATERIALS AND METHODS: The New York State Hospital Inpatient Cost Transparency Database was reviewed to determine the costs of 69,831 hospital discharges between 2009 and 2011 comprising the 3 most commonly performed spine surgeries in the state. These costs were then analyzed in the context of the specific all patient refined diagnosis-related group (DRG) SOI modifier to determine this index's effect on overall costs.

RESULTS: Overall, hospital-reported cost increases with the patient's SOI class and patients with worse baseline health incur greater hospital costs (P<0.001). Moreover, these costs are increasingly variable for each worsening SOI class (P<0.001). This trend of increasing costs is persistent for all 3 DRGs across all 3 years studied (2009-2011), within each of the 7 New York state regions, and occurs irrespective of the hospital's teaching status or size.

CONCLUSIONS: Using the 3M all patient refined-DRG SOI index as a measure of patient's health status, a significant increase in cost for spine surgery for patients with higher SOI index was found. This study confirms the greater cost and variability of spine surgery for sicker patients and illustrates the inherent unpredictability in cost forecasting and budgeting for these same patients.