The Northeastern Society of Plastic Surgeons

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Can Nationwide Variability in Charges for Outpatient Pediatric Urologic Surgeries Be Explained By Hospital or Regional Factors?
Courtney K. Rowe, MD, Jonathan S. Ellison, MD, Paul A. Merguerian, MD, MS.
Seattle Children's Hospital, Seattle, WA, USA.

BACKGROUND: With rising health care expenditures, ever-changing reimbursement policies and little evidence linking higher charges with higher quality care, insurance companies continue to push for price transparency. Patients are seeing charge data, which may affect referral patterns and patient flow. Previous studies revealed wide variations in charge for the same procedures across adult and pediatric hospitals. We assessed variability in charges for common outpatient pediatric urologic procedures, hypothesizing that charges would have little correlation to hospital or regional factors.
METHODS: We evaluated charge data from the Pediatric Health Information System (PHIS) database for five outpatient pediatric urologic procedures - meatotomy, hydrocelectomy, orchiopexy, circumcision and lysis of penile adhesions. We focused on elective surgeries with minimal variation in patient selection, operative time or equipment cost.
High and low volume and charge hospitals per surgery and high and low charge hospitals for all five surgeries were defined as the upper and lower quartile. Linear regression controlled for surgical volume was used to analyze continuous variables and ANOVA was used to analyze categorical values.
RESULTS: We evaluated charge data in the PHIS database for 43 children's hospitals between 2012-2015 and adjusted for cost of living index. Total meatotomies was 3,703 with mean charge $5,081 ($799-13,199). Total hydrocelectomies was 2,785 with mean charge $9,215 ($3,143-16,207). Total orchiopexies was 28,701 with mean charge $11,066 ($4,015-17,315). Total circumcisions was 37,256 with mean charge $8,139 ($3,126-14,725) and total lysis of penile adhesions was 5,043 with mean charge $5,864 ($2,687-14,200).
There was no statistically significant pattern across the five selected procedures associating mean charges with geographic region, percentage private insurance, median income at the hospital zip code, number of staffed beds or average daily census. There was also no pattern associating charges with high and low volume per procedure.
There was a great variation in charges between hospitals for all procedures (Figure 1.) The difference between mean charges from a high charge hospital and a low charge hospital was $7,695 for meatotomy (151% of mean), $8,105 for hydrocele (88% of mean), $8,693 for orchiopexy (79% of mean), $6,650 for circumcision (82% of mean) and $6,302 for lysis of penile adhesions (107% of mean). High and low charges for each procedure clustered within hospitals; many hospitals in the highest and lowest quartile for one procedure also in this quartile for other procedures (Figure 2.)
CONCLUSIONS: We found a large variation in charges for outpatient urologic procedures without clear association with hospital demographics but clustering of high and low charges within hospitals. Surgeons and hospitals alike should strive to not only cut costs but the charges seen by our patients. Low charge hospitals may be able to serve as benchmarks for quality improvement initiatives and streamlining of charges.


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