Medicaid Reimbursement for Orthopedic Oncology Procedures Is Over 22% Lower Than Medicare and Highly Inconsistent Among States

Abstract

Background and objectives: Medicaid reimbursement to physicians has been demonstrated to be lower than reimbursement from Medicare and private insurance. Studies on Medicaid reimbursement for orthopedic oncology procedures, however, are limited. This study compares Medicaid reimbursement rates to Medicare for 38 common musculoskeletal oncology procedures and assesses variability among states.

Methods: We collected 38 current procedural terminology (CPT) codes for commonly performed orthopedic oncology procedures. Medicare rates were obtained from the 2023 Centers for Medicare and Medicaid physician (CMS) fee schedule. Medicaid rates were collected from electronic state website fee schedules. Reimbursement for the two insurance types were compared with state and national averages. Dollar differences were adjusted for work relative value units (RVU) to ascertain procedural variability. The Medicare Wage Index, representing differences in wages across states, was used to adjust medicaid rates to compare more accurately to medicare. Coefficient of variation values, calculated by dividing the standard deviation by the mean, were calculated to assess variation among procedures.

Results: Medicaid reimbursed orthopedic oncologists 22.1% less than medicare on average, increasing to 33.0% when adjusting for wage differences. State Medicaid reimbursement ranged from 37% to 131% of Medicare, with 38 states reimbursing less than Medicare on average. The coefficient of variation for Medicaid procedures ranged from 0.24 to 0.46, indicating wide variability among states and procedures, while for Medicare, the coefficient of variation was low at 0.06 to 0.07.

Conclusions: Medicaid reimbursement for common orthopedic oncology procedures is substantially lower and more variable than Medicare, despite the often urgent nature of these surgeries. Disparities in reimbursement may impact access to care for this population, highlighting the need for policy reform.

Keywords: Medicaid; Medicare; oncology; orthopedics; reimbursement.