Unexpectedly Intriguing!
April 7, 2011
Ambulance Service - Source: City of Monterey Park

With so many politicians focused on controlling the costs of Medicare, we thought it might be time to review what the most popular medical procedures paid for by U.S. taxpayer dollars actually are.

To that end, we adapted an interactive table originally presented by the Wall Street Journal in October 2010, which describes the Top 50 procedures, services and items that Medicare paid for in 2008, including the number of each performed, which to our knowledge is the most recent data available.

But unlike the WSJ, we went the extra mile and added an extra column to show the average cost of each procedure, service or item for which U.S. taxpayers paid through their Medicare taxes.

We then also distinguished between the line items that were seemingly duplicated, such as for Office Consultations, by identifying each apparently duplicated entry with a class level. Here, we suspect that the data is actually recording different kinds of services associated with different levels of medical professionals, such as general practitioners and various kinds of specialists, which might perhaps explain the difference in the average cost of these "identical" services.

We then presented all that data in our own dynamic table, with the line items initially ranked from low to high based upon the total money estimated to have been spent on each in 2008. You can re-rank the data in the table by clicking the various column headings, either from high-to-low by clicking once, or from low-to-high by clicking the column heading a second time.

Number and Cost of Top 50 Medicare Procedures in 2008*
Description of Procedure Billed to Medicare in 2008 Number of Procedures Performed Total of Payments for Procedure Average Payment per Procedure
Chemotherapy, IV infusion, 1 hr 2,366,910 $292,913,476 $123.75
Comprehensive metabolic panel 25,549,077 $294,608,633 $11.53
Lipid panel 20,742,486 $297,905,976 $14.36
Doppler echo exam, heart 7,837,043 $302,062,401 $38.54
Total knee arthroplasty 250,549 $302,500,618 $1,207.35
Office/outpatient visit, new (Class 2) 3,312,989 $311,861,165 $94.13
Eye exam, established patient 6,458,252 $317,654,673 $49.19
Office/outpatient visit, new (Class 1) 5,301,932 $317,984,572 $59.98
Assay thyroid stim hormone 13,783,912 $322,226,556 $23.38
Nursing FAC care, subsequent (Class 2) 5,735,579 $324,814,028 $56.63
Chiropractic manipulation 13,889,053 $330,517,467 $23.80
Complete CBC w/auto diff WBC 31,422,660 $336,257,936 $10.70
Nursing FAC care, subsequent (Class 1) 8,825,261 $372,509,414 $42.21
Office consultation (Class 3) 2,307,338 $385,609,556 $167.12
Subsequent hospital care (Class 3) 15,004,362 $418,205,380 $27.87
End-stage renal disease services 1,940,857 $420,419,359 $216.62
Office consultation (Class 2) 4,943,921 $433,240,000 $87.63
Darbepoetin alfa, non-ESRD 191,380,979 $433,797,114 $2.27
Emergency department visit (Class 2) 5,369,592 $440,586,311 $82.05
Injection, pegfilgrastim 6mg 254,434 $441,075,691 $1,733.56
Inpatient consultation (Class 2) 2,940,015 $455,323,437 $154.87
Power wheelchair 158,185 $490,431,421 $3,100.37
Infliximab injection 11,378,479 $492,323,213 $43.27
Office/outpatient visit, est. (Class 1) 20,255,955 $514,274,786 $25.39
Bevacizumab injection 12,212,667 $552,036,000 $45.20
Radiation TX delivery, IMRT 1,188,883 $554,437,178 $466.35
Ranibizumab injection 1,939,600 $557,297,353 $287.33
Ambulance service, basic life support, emergency transport 2,440,577 $641,642,756 $262.91
TTE w/o doppler, complete 7,579,894 $656,716,316 $86.64
Rituximab injection 1,633,495 $668,297,585 $409.12
Critical care, first hour 4,161,843 $684,084,409 $164.37
Eye exam & treatment 10,263,836 $693,992,355 $67.62
Office/outpatient visit, est. (Class 2) 8,526,696 $723,630,748 $84.87
Inpatient consultation (Class 1) 5,873,726 $730,965,964 $124.45
Ground mileage 127,784,548 $734,228,371 $5.75
Initial hospital care 5,805,874 $779,940,359 $134.34
Therapeutic exercises 36,611,340 $790,131,340 $21.58
Office consultation (Class 1) 6,182,506 $820,722,137 $132.75
Myocardial perfusion imaging 2,871,503 $860,663,333 $299.73
Blood glucose test or reagent strips for home blood glucose monitor 32,622,834 $896,219,204 $27.47
Tissue exam by pathologist 15,727,600 $920,244,381 $58.51
Emergency department visit (Class 1) 8,130,827 $1,030,949,537 $126.80
Ambulance service, basic life support, non-emergency transport 6,324,880 $1,032,448,022 $163.24
Ambulance service, advanced life support, emergency transport 4,487,130 $1,370,290,648 $305.38
Subsequent hospital care (Class 2) 20,700,736 $1,508,043,275 $72.85
Cataract surgery w/IOL, 1 stage 2,725,818 $1,650,549,973 $605.52
Oxygen concentrator 12,712,109 $1,968,456,688 $154.85
Subsequent hospital care (Class 1) 51,288,878 $2,587,330,103 $50.45
Office visit, established patient with medical problems of low to moderate severity 102,084,298 $4,125,227,173 $40.41
Office visit, established patient with medical problems of moderate to high severity 69,074,543 $4,265,600,329 $61.75
Totals 962,366,461 $40,853,248,720 $42.45

Combined, these fifty procedures add up to nearly $40.9 billion, the product of an average cost of $42.45 per procedure for well over 962 million procedures. The WSJ provided the following graphic to put that amount in context with total spending for Medicare in 2009:

WSJ: Where the Money Goes | Medicare Spending, in billions 2009

To us, the most surprising item in the list is the one item that really can't be described as a medical procedure, service or item. It's Ground Mileage.

Here, despite having the second least expensive average cost of $5.75 per "procedure," it ranks as the 16th most expensive procedure for taxpayers to pay to provide to Medicare beneficiaries, as it was performed some 127,784,548 times in 2008, costing taxpayers over $730 million.

At first, we weren't really sure what might be going on there, but then we figured out that the payments are most likely for the miles that ambulances were being driven to provide service to Medicare patients, which is reimbursed by Medicare separately from en-route medical ambulance services.

References

Mathews, Anna Wilde and McGinty, Tom. Physician Panel Prescribes the Fees Paid by Medicare. Wall Street Journal. 26 October 2010.

Wall Street Journal. Interactive Table: Billed to Medicare. 27 October 2010. Accessed 6 April 2011.

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