Variation in Costs of Spinal Implants in United States Academic Medical Centers

Study Design.Retrospective study of benchmarking database.Objective.To evaluate the variability in direct costs of spinal implants across various academic medical centers, determining variability between and within specific manufacturers, and to measure the relationship between purchasing volume and price.Summary of Background Data.Spinal implants are a significant component of the cost of surgery. There is an absence of transparency of how much various medical centers in the United States pay for implants because of the use of nondisclosure agreements as part of price negotiations. Transparency of information on costs and awareness of costs by physicians will be useful in managing costs in a value-based health care economy.Methods.Purchasing records of 45 academic medical centers over a 12-month period were examined. Purchasing volume and unit pricing for pedicle screws (PS), anterior cervical plates (ACP), and transforaminal lumbar interbody fusion (TLIF) cages were collected for 6 manufacturers. Overall variation in implant costs across centers and for each manufacturer was determined as was the relationship between purchasing volume and unit price.Results.We found variation in implant costs between medical centers, and between manufacturers for PS, ACP and TLIF similar to joint replacement implants. Regression analysis showed that for each 10-fold increase in purchasing volume, the unit price decreased by $126 for PS, $242 for ACP, and $789 for TLIF.Conclusion.There was variation in implant costs between medical centers and manufacturers of implants, with a small negative relationship between purchasing volume and cost. Transparency in cost negotiation, surgeon awareness of costs and alignment between surgeon and hospital goals may help decrease the cost of spinal implants, and the cost of care for patients undergoing instrumented fusions.Level of Evidence: 4