Reimbursement in Breast Reconstruction: To Carve out or Cut out, That Is the Question

Background:   With greater awareness and federal mandates, the demand for breast reconstruction has grown. Despite this increasing patient population, the uncertainty of physician reimbursement persists; with wide variation based on payor type. Although the technical aspects and time commitments of autologous and implant-based reconstruction are the same, regardless of insurance status, the expected reimbursement for these services and potential “revenue loss” could have major implications in patient access to their reconstruction of choice. Some surgeons have attempted to circumvent this issue by developing insurance carve-outs for autologous reconstruction. For those surgeons unable to negotiate this arrangement with insurance carriers, a major concern is that these surgeons will find it financially challenging to offer certain types of reconstructions to all payor types. The purpose of this study is to identify re-imbursement variation among payor type for breast reconstruction procedures at a tertiary academic center in an effort to understand potential financial implications and begin developing safeguards to prevent effects on patient access to all available reconstructive options.  

Methods:  Billing and insurance data were collected over a 10 year period for CPT codes 19364 (ABR) and 19357 (IBR) at a single institution.  Patients were categorized by insurance type.  Charges and reimbursement were collected and compared using ANOVA testing and a two-sided Student’s T-test with p<0.05 indicating significance.

Results:  2365 women underwent implant-based reconstruction (IBR), and 359 women underwent autologous breast reconstruction (ABR).  Average charges for IBR was $6,199 for commercial insurance patients, $5689 for Medicare, and $5,727 for Medicaid (p<0.001).  Reimbursement was $3,992 for patients with commercial insurance, which is significantly higher than Medicare ($1,629.43) or Medicaid ($904) patients (p<0.001).  Average charges for ABR was $12,891 for commercial insurance, $12,773 for Medicare, and $10,817 for Medicaid (p<0.001).  Reimbursement was $4,778 for commercial insurance, which is significantly higher than Medicare ($2,959) or Medicaid ($1,473) (p<0.001). The hourly reimbursement for IBR vs. ABR is significantly different across all payor types. In an average 6 hour ABR case, commercial insurance pays $303 and $550 more, per hour, than Medicare and Medicaid, respectively.

Conclusions: Significant gaps exist between payor reimbursements for breast reconstruction. These gaps pose serious threats to patient access to reconstruction of choice based on their insurance status.