Did the Influx of Specialty Spine Clinics Lead to an Increase in Spinal Fusions?

Proponents of physician-owned spine hospitals and clinics suggest they can provide more effective and cost-effective care of back pain and spinal problems than traditional hospitals. Specialization may lead to seamless, efficient care; economies of scale; lower production costs; improved outcomes; and higher levels of patient satisfaction. Detractors of physician-owned specialty hospitals suggest that they lead to the over utilization of poorly documented spinal procedures, particularly profitable invasive procedures. And that they create conflicts of interest for physician-investors who treat their own patients at these facilities. Economist Jean Mitchell, PhD, of Georgetown University recently examined trends in spine treatment utilization rates after the entry of physician-owned specialty clinics into two urban areas of Oklahoma . (See Mitchell, 2007.) Using claims data from the largest workers’ compensation insurance provider in Oklahoma , she studied the impact of specialty hospitals on spinal fusion rates involving workers’ compensation claimants from 1999 to 2004. The study found an increase in complex spinal fusions (e.g. instrumented circumferential fusions) but not in cheaper simple spinal fusions. Prior to the influx of specialty hospitals, the market area utilization rate for complex spinal fusion was 1.93 per 1000 back/spine cases under treatment. By 2004, this rate rose to 49 per 1000 back/spine cases under treatment. “This represents close to a 2439% increase in the market area utilization rate for complex spinal surgery for the study population,” according to Mitchell. The market area utilization rate for simple spinal fusions fell over the same time period. “For injured workers with back problems, physician-owned hospitals appear to have increased the use of complex spinal fusion surgery [i.e. instrumented circumferential fusions], the more lucrative procedure, in lieu of the less profitable simple spinal fusion surgeries,” according to Mitchell. Unfortunately, it was impossible to come up with a control group because there were no hospital market areas in Oklahoma that did not include physician-owned specialty hospitals.

Study of Fusion Among Medicare Beneficiaries

So instead, Mitchell performed a parallel investigation of trends in the utilization of fusion procedures among Medicare beneficiaries from 2000 through 2004. She compared rates of spinal fusion in four states with physician-owned specialty spine hospitals with several New England states where these types of hospitals don’t exist. The Georgetown economist found precipitous increases in profitable complex spinal fusion rates in the states with the specialty hospitals, but smaller increases in the New England area. “The utilization rate for complex spinal fusion in Oklahoma increased from 0.52 per 10,000 beneficiaries in 2000 to 4.05 in 2004, an increase of 679%,” Mitchell reported. There was almost a 300% increase in complex spinal fusion rates in South Dakota , a 637% increase in Arizona , and a 1395% increase in Kansas . By comparison there was a 194% increase in the New England states over the same time period. It is unlikely that these differences in fusion rates are solely related to the presence of physician-owned specialty hospitals. There are a variety of potentially confounding factors that might have contributed to these discrepancies, including rising spine surgery rates nationwide, geographic variations in surgery rates, changes in coding, varying patient populations, etc. However, Mitchell believes that the rise of specialty hospitals is the most likely explanation for these changes in utilization patterns. “Again, we considered other possible explanations for the dramatic differences in utilization that exist between the northeast and states with physician-owned specialty hospitals, but none could account for these stark differences,” she concluded. It is important to note that this type of study isn’t capable of making inferences about the benefits and risks of complex spinal fusions among workers’ compensation claimants or Medicare beneficiaries. However, recent studies of the results of spinal fusion surgery among workers’ compensation claimants are not reassuring. The overall success rates of spinal fusion among Medicare patients is something of a mystery, as they haven’t been studied in detail.

Reference:

Mitchell J, Utilization changes following market entry by physician-owned specialty hospitals, Medical Care Research and Review, 2007; 64:395–415.

Taken from “The Back Letter” Volume 22, Number 11, 2007