CMS Sets Disc Arthroplasty Procedure Payments at Discectomy Levels - $4,200-6,300
BY ROBIN R. YOUNG CFA, MAY 24, 2004
Insufficient data from manufacturers forced the Center for Medicare and Medicaid Services (CMS) last week to set payment rates for Disc Arthroplasty at rates far, far below the true cost of a disc arthroplasty procedure.
For Spinal repair, CMS has two types of reimbursement, Fusion and Non-Fusion. The only non-fusion procedure currently approved under CMS for payment is discectomy, which is a procedure to remove spinal disc material - no implant. So, lacking adequate disc arthroplasty cost data from such prospective manufacturers as JNJ (who's likely to get first approval), Synthes or Sofamor Danek, CMS had no choice but to set disc arthroplasty payment levels at discectomy levels.
To be sure, CMS is not going to be reimbursing anything close to a significant number of disc arthroplasty procedures. CMS reimburses for patients 65+ years of age while disc arthroplasty is clearly geared to younger, more active patients (age 25-55). But private pay insurers rely on CMS's analysis to provide a guideline for subsequent payment decisions.
The cost of a disc arthroplasty procedure is expected to be comparable to spine cage procedures, between $35,000 and $40,000. Setting reimbursement rates at $4,200-6,300 for a $35,000 procedure means someone was asleep at the wheel.
Certainly, JNJ, et al will be submitting disc arthroplasty cost data sooner than later, probably this summer. By October, we would expect CMS's payment rates will be significantly higher; we'd guess 3-4x higher.
