Back surgery is one of the most overused types of surgery and back pain is the most common ailment that sends patients to doctors, chiropractors and physical therapists. More than $90 billion a year is spent on low-back pain alone.
On any given day, 31 million Americans experience low-back pain, and it is the leading cause of disability worldwide, according to the 2017 Global Burden of Disease study. Back pain also is one of the most common reasons for missed work.
Controlling costs is a major effort most health insurers are focusing on with patients who want back surgery. In Michigan, Blue Cross Blue Shield of Michigan, Blue Care Network, Priority Health and Health Alliance Plan have programs to ensure members have carefully weighed their options.
Nationally, more than 1.2 million spinal surgeries are performed each year, including spinal fusion and decompression, or discectomy, surgery, according to the National Center for Health Statistics. The fastest-growing types the past decade have been lumbar spinal fusion surgeries that range from $60,000 to $110,000 per procedure.
Some studies have shown that the back surgery failure rate, known as failed back syndrome, is as high as 50 percent. But most spine experts say one-third of patients will have successful outcomes, one-third will have no change and one-third will be worse off.
Since 2007, Priority Health has cut down on back surgery costs by requiring patients who have non-emergency surgery to consult with a rehabilitation doctor, or physiatrist, about treatment options before surgery, said John Fox, M.D., Priority's medical director.
During the first year of the spine program, Priority had an $8 million reduction in costs. Surgery costs fell 24 percent and imaging 18 percent.
Over the past dozen years, healthcare costs have risen and the population Priority serves has nearly doubled, Fox said. "Our spine surgery rate was 4.1 per thousand in 2006 and today it's 2.1 per thousand," he said. "For the commercial population of just over 500,000, that translates into a cost savings of $36 million per year in avoided costs."
In 2019, Priority will adopt a new prior authorization criteria that encourages patients to have possible diabetes and hypertension under control, minimize the use of opioids and be either a nonsmoker or in a cessation program.
"The evidence demonstrates that risk factor modification reduces the likelihood of surgical complications, hospital readmission and repeat surgery," Fox said.
As a result over the past five years fusion surgery has not increased and surgery for herniated disks has decreased, Fox said.
Depending on the payer, Medicaid, Medicare or private, provider discounts to health insurers can cut the actual cost to the insurer to up to 35 percent of billings. For example, a $100,000 hospital and doctor combined bill could be cut to a total payment of $35,000.
The goal for surgeons in dealing with third-party payers is to continue to provide excellent quality care in the face of declining reimbursements, said Jayant Jagannathan, a Troy-based neurosurgeon. "Insurances are getting more and more difficult to deal with. The biggest obstacles are the variability in terms of criteria for coverage in spine. Significant differences in hospital reimbursement also make some hospitals not want to approve fusions for certain Medicaid programs."
But Jagannathan added: "Whatever the payment, our goal is to provide quality care and work with patients for the best outcomes."
At HAP, treatment costs for chronic low-back problems have leveled off the past two years, partially due to use of alternative treatments and enhanced pain management, said Charles Bloom, D.O., HAP's vice president of utilization management and provider relations. HAP requires authorization before surgery and expensive imaging tests.
"As we see improvements in the appropriate utilization of spine surgery, we have seen increased utilization of pain management interventions (such as steroid injections) for which we also require authorization," Bloom said. "We have noted increased interest in nontraditional methods of pain management such as acupuncture, massage therapy, behavioral therapy and more traditional chiropractic services."
Marc Kesheshian, M.D., Blue Care's chief medical officer, said the Blues added prior authorization for spinal fusion surgery after 2012 as the number of back surgeries increased and costs rose. He said disk compression surgeries don't require prior authorization.
"(The member) calls in to inform us, and we evaluate the clinical information they provide. If it meets our standards, we approve the surgery," Kesheshian said. "If not, we speak to the doctor to justify and explain it."
Over the past several years, Blue Cross and Blue Care have seen an increase in back surgery claims, with the largest increase for spinal fusion and a slight increase for decompression surgeries. In 2017, Blue Cross paid for 5,500 spine and back surgeries in Michigan for the commercial population. Blue Cross declined to provide data on denials or trend information on back surgeries.
"The denial rates are very low," Kesheshian said.
Jagannathan said about 95 percent of requests his office makes to health insurers are approved. "Only 5 percent get declined. Thirty percent of insurers initially will refuse or ask for additional justification, but most end up approving after we explain," he said.
Blue Cross, like most payers, encourages physical therapy or other nonsurgical options, including pain management, before surgery.
"We don't require second opinions. We make sure members get conservative therapy first," said Kesheshian, adding that usually is physical therapy, but the Blues also pay for chiropractic care. "After physical therapy, if there is some reason why the surgery is necessary, we would approve it at that point."
Jagannathan said there is no consensus when fusion surgery is recommended and every health insurer has its own criteria. Generally, spinal fusion can be recommended for severe degenerative disk changes, lumbar herniated disks or lumbar spinal stenosis. Any surgery must include a determination that fusing two or more disks will lead to reduction of pain and increase in mobility.