Performing a Cost Analysis in Spine Outcomes Research

Abstract

Medical cost analysis is increasingly important, but the methodology is complex and varied. To illustrate how different cost analysis methodologies influence conclusions generated from data from a prospective nonrandomized trial for treatment of cervical spondylotic myelopathy. Patients 40 to 85 years of age with degenerative cervical spondylotic myelopathy were enrolled from 7 sites over 2 years (2007-2009). Patients were treated with ventral or dorsal fusion surgery, and outcomes were measured to 1 year postoperatively. A hospital-based cost analysis was performed using Medicare cost-to-charge ratios (CCRs) multiplied by hospital charges from the index hospitalization (CCR method). A society-based cost analysis was performed by estimating costs from the index hospitalization using Medicare coding reimbursement (the Medicare reimbursement method). A separate outpatient cost analysis was performed on a subset of 20 patients. Of the 85 patients analyzed, 72 had 1-year follow-up. The CCR method showed a difference in upfront direct costs between the dorsal and ventral approaches ($27,942 ± 14,220 vs $21,563 ± 8721; P = .02). Overall upfront direct costs with the Medicare reimbursement method were not different. With the CCR method, the ventral approach dominates an incremental cost-effectiveness ratio analysis. With the Medicare reimbursement method, the incremental cost-effectiveness ratio for ventral surgery is $34,533, the cost of 1 additional quality-adjusted life-year gained by using ventral instead of dorsal surgery. In the subanalysis, outpatient costs were less after ventral surgery than dorsal surgery ($1997 ± 1211 vs $4734 ± $2874; P = .006). The choice of cost methodology may substantially influence the final results of an economic study.