Determinants of Commercial Prices for Common Radiation Therapy Procedures

Abstract

<h3>Purpose/Objective(s)</h3> Radiation oncologists are increasingly working in larger practices. The implications of changing practice patterns on the cost of care have not been well studied. We analyzed whether radiation practice consolidation and other market factors were associated with higher prices for radiation therapy. <h3>Materials/Methods</h3> Utilizing a database of U.S. hospital-reported price transparency data, we characterized the prices paid by commercial insurers for 4 common RT procedures—Intensity modulated RT (IMRT) Planning (Common Procedural Terminology (CPT) code 77301), IMRT Delivery (77386), 3D RT (3DRT) Planning (77295), and 3DRT Delivery (77412). To assess variation, we calculated the ratio of the 90^th percentile to the 10^th percentile price among different insurers in each hospital and among different hospitals in each Hospital Referral Region (HRR). We measured levels of radiation oncology practice market consolidation via the standard Herfindahl-Hirschman Index. We generated multivariable models to test the association of various hospital, health system, regional, and market factors on commercial prices, specifically evaluating the impact of radiation oncology practice consolidation. <h3>Results</h3> A total of 1,069 hospitals reported prices for any of the 4 RT procedures considered in this study. National median commercial prices for IMRT planning and IMRT delivery were $4,073 (IQR: $2,242-$6,305) and $1,666 (IQR: $1,014-$2,619), respectively, while those for 3DRT planning and 3DRT delivery were $2,824 (IQR: $1,339-$4,738) and $616 (IQR: $419-877), respectively. Within each hospital, the 90^th percentile price paid by commercial insurers was 2.3 to 2.5 times higher on average than the 10^th percentile price across the 4 procedures. Among different hospitals in each HRR, the median price at the 90^th percentile hospital was between 2.4 and 3.2 times higher than at the 10^th percentile hospital. On multivariable analysis, higher prices for the 4 procedures were generally observed at for-profit hospitals (3DRT Planning: median price 58% higher than non-profit, p=0.02; 3DRT Delivery: +68%, p<0.001) teaching hospitals (IMRT Delivery: +34%, p=0.02; 3D-RT Planning: +34%, p=0.03), and hospitals affiliated with large health systems (3D-RT Planning: +2%, p=0.04; 3D-RT Delivery: +2%, 0=0.03). Regional levels of radiation oncology practice consolidation did not have a statistically significant impact on any of the prices. <h3>Conclusion</h3> Utilizing nationwide price transparency data, we found that commercial prices for commonly billed RT procedures demonstrate significant variability. Prices for the same procedure vary by more than a factor of 2 depending on a patient's commercial insurer and hospital of choice. Prices appear to be driven by specific hospital and health-system characteristics with little apparent influence from radiation oncology practice consolidation. Further study is warranted to characterize the implications of price variability on access and costs of care.