Ventral Hernia Repair Incurs Overall Financial Losses

SAN DIEGO – Ventral hernia repair is associated with overall financial losses reaching the thousands of dollars in some cases, a single-center study demonstrated.

"These financial losses are just simply not sustainable," Dr. Drew Reynolds said in an interview prior to the annual Digestive Disease Week, where the study was presented.

In what is believed to be the first study of its kind, he and his associates set out to systematically evaluate hospital finances with respect to open ventral incisional hernia repair in the tertiary care environment.

"There is limited cost data currently available in the literature," he said. "These patients are complex and often require management in tertiary referral centers. Biologic meshes have a legitimate role in certain clinical scenarios, especially in those encountered in the tertiary care environment. Reimbursement strategies need to be reevaluated with more appropriate adjustment for preoperative risk factors and operative complexity."

Hospital costs associated with complex hernia repairs include direct costs (mesh materials, supplies, and non–surgeon labor), and indirect costs (facility fees, equipment depreciation, and unallocated labor), said Dr. Reynolds, a fellow in minimally invasive surgery at the University of Kentucky, Lexington. "Operative supplies including mesh represent a significant component of direct costs, especially in an era of proprietary synthetic meshes and biologic grafts," the researchers wrote in their abstract.

Dr. Reynolds and his associates evaluated cost data on 415 consecutive open ventral hernia repairs performed at the university’s hospital between July 1, 2008, and May 31, 2011, using CPT codes 49560, 49561, 49565, and 49566. They analyzed data based on hospital status (inpatient vs. outpatient) and whether the hernia repair was a primary or secondary procedure. The primary end points were hospital revenue and costs. Revenue calculations were adjusted for comorbid conditions/diagnosis-related groups, and readmission costs were not included.

Of the 415 patients, 353 were inpatients and 62 were outpatients. Among the 353 inpatients, ventral hernia repair was the primary procedure performed on 173 patients and was the secondary procedure for 180 patients. The median net revenue was significantly greater for those who underwent hernia repair as a secondary procedure compared with those who had hernia repair as a primary procedure ($17,310 vs. $10,360, P less than .01), as were net losses ($3,340 vs. $1,700, P less than .01).

Among the inpatient primary ventral hernia repairs, 46 were repaired without mesh, 79 were repaired with synthetic mesh, and 48 were repaired with biologic mesh, for median direct costs of $5,432, $7,590, and $16,970, respectively (P less than .01).

Dr. Reynolds also reported that among all inpatient ventral hernia repairs, the median net losses for repairs without mesh were $500, while synthetic mesh–based repairs yielded a median net profit of $60. The median contribution margin for cases involving biologic mesh was –$4,560, and the median net financial loss was $8,370.

Among patients who underwent outpatient ventral hernia repairs, median net losses among those performed with and without synthetic mesh reached $1,560 and $230, respectively.

"It was surprising to note that the vast majority of open ventral incisional hernia repairs are performed at an overall financial loss for the hospital," Dr. Reynolds said. "Further, it was surprising to note that inpatient biologic mesh–based ventral hernia repairs resulted in such a sizable negative median contribution margin ($4,560), and the striking median net financial loss of $8,370."

He acknowledged certain limitations of the study, including the fact that data used in the analysis were retrieved by CPT code search. "Hospital readmission costs were not included, which leads to underestimation of the costs," he added.

Dr. Reynolds said that he had no relevant financial conflicts to disclose.

SAN DIEGO – Ventral hernia repair is associated with overall financial losses reaching the thousands of dollars in some cases, a single-center study demonstrated.

"These financial losses are just simply not sustainable," Dr. Drew Reynolds said in an interview prior to the annual Digestive Disease Week, where the study was presented.

In what is believed to be the first study of its kind, he and his associates set out to systematically evaluate hospital finances with respect to open ventral incisional hernia repair in the tertiary care environment.

"There is limited cost data currently available in the literature," he said. "These patients are complex and often require management in tertiary referral centers. Biologic meshes have a legitimate role in certain clinical scenarios, especially in those encountered in the tertiary care environment. Reimbursement strategies need to be reevaluated with more appropriate adjustment for preoperative risk factors and operative complexity."

Hospital costs associated with complex hernia repairs include direct costs (mesh materials, supplies, and non–surgeon labor), and indirect costs (facility fees, equipment depreciation, and unallocated labor), said Dr. Reynolds, a fellow in minimally invasive surgery at the University of Kentucky, Lexington. "Operative supplies including mesh represent a significant component of direct costs, especially in an era of proprietary synthetic meshes and biologic grafts," the researchers wrote in their abstract.

Dr. Reynolds and his associates evaluated cost data on 415 consecutive open ventral hernia repairs performed at the university’s hospital between July 1, 2008, and May 31, 2011, using CPT codes 49560, 49561, 49565, and 49566. They analyzed data based on hospital status (inpatient vs. outpatient) and whether the hernia repair was a primary or secondary procedure. The primary end points were hospital revenue and costs. Revenue calculations were adjusted for comorbid conditions/diagnosis-related groups, and readmission costs were not included.

Of the 415 patients, 353 were inpatients and 62 were outpatients. Among the 353 inpatients, ventral hernia repair was the primary procedure performed on 173 patients and was the secondary procedure for 180 patients. The median net revenue was significantly greater for those who underwent hernia repair as a secondary procedure compared with those who had hernia repair as a primary procedure ($17,310 vs. $10,360, P less than .01), as were net losses ($3,340 vs. $1,700, P less than .01).

Among the inpatient primary ventral hernia repairs, 46 were repaired without mesh, 79 were repaired with synthetic mesh, and 48 were repaired with biologic mesh, for median direct costs of $5,432, $7,590, and $16,970, respectively (P less than .01).

Dr. Reynolds also reported that among all inpatient ventral hernia repairs, the median net losses for repairs without mesh were $500, while synthetic mesh–based repairs yielded a median net profit of $60. The median contribution margin for cases involving biologic mesh was –$4,560, and the median net financial loss was $8,370.

Among patients who underwent outpatient ventral hernia repairs, median net losses among those performed with and without synthetic mesh reached $1,560 and $230, respectively.

"It was surprising to note that the vast majority of open ventral incisional hernia repairs are performed at an overall financial loss for the hospital," Dr. Reynolds said. "Further, it was surprising to note that inpatient biologic mesh–based ventral hernia repairs resulted in such a sizable negative median contribution margin ($4,560), and the striking median net financial loss of $8,370."

He acknowledged certain limitations of the study, including the fact that data used in the analysis were retrieved by CPT code search. "Hospital readmission costs were not included, which leads to underestimation of the costs," he added.

Dr. Reynolds said that he had no relevant financial conflicts to disclose.

SAN DIEGO – Ventral hernia repair is associated with overall financial losses reaching the thousands of dollars in some cases, a single-center study demonstrated.

"These financial losses are just simply not sustainable," Dr. Drew Reynolds said in an interview prior to the annual Digestive Disease Week, where the study was presented.

In what is believed to be the first study of its kind, he and his associates set out to systematically evaluate hospital finances with respect to open ventral incisional hernia repair in the tertiary care environment.

"There is limited cost data currently available in the literature," he said. "These patients are complex and often require management in tertiary referral centers. Biologic meshes have a legitimate role in certain clinical scenarios, especially in those encountered in the tertiary care environment. Reimbursement strategies need to be reevaluated with more appropriate adjustment for preoperative risk factors and operative complexity."

Hospital costs associated with complex hernia repairs include direct costs (mesh materials, supplies, and non–surgeon labor), and indirect costs (facility fees, equipment depreciation, and unallocated labor), said Dr. Reynolds, a fellow in minimally invasive surgery at the University of Kentucky, Lexington. "Operative supplies including mesh represent a significant component of direct costs, especially in an era of proprietary synthetic meshes and biologic grafts," the researchers wrote in their abstract.

Dr. Reynolds and his associates evaluated cost data on 415 consecutive open ventral hernia repairs performed at the university’s hospital between July 1, 2008, and May 31, 2011, using CPT codes 49560, 49561, 49565, and 49566. They analyzed data based on hospital status (inpatient vs. outpatient) and whether the hernia repair was a primary or secondary procedure. The primary end points were hospital revenue and costs. Revenue calculations were adjusted for comorbid conditions/diagnosis-related groups, and readmission costs were not included.

Of the 415 patients, 353 were inpatients and 62 were outpatients. Among the 353 inpatients, ventral hernia repair was the primary procedure performed on 173 patients and was the secondary procedure for 180 patients. The median net revenue was significantly greater for those who underwent hernia repair as a secondary procedure compared with those who had hernia repair as a primary procedure ($17,310 vs. $10,360, P less than .01), as were net losses ($3,340 vs. $1,700, P less than .01).

Among the inpatient primary ventral hernia repairs, 46 were repaired without mesh, 79 were repaired with synthetic mesh, and 48 were repaired with biologic mesh, for median direct costs of $5,432, $7,590, and $16,970, respectively (P less than .01).

Dr. Reynolds also reported that among all inpatient ventral hernia repairs, the median net losses for repairs without mesh were $500, while synthetic mesh–based repairs yielded a median net profit of $60. The median contribution margin for cases involving biologic mesh was –$4,560, and the median net financial loss was $8,370.

Among patients who underwent outpatient ventral hernia repairs, median net losses among those performed with and without synthetic mesh reached $1,560 and $230, respectively.

"It was surprising to note that the vast majority of open ventral incisional hernia repairs are performed at an overall financial loss for the hospital," Dr. Reynolds said. "Further, it was surprising to note that inpatient biologic mesh–based ventral hernia repairs resulted in such a sizable negative median contribution margin ($4,560), and the striking median net financial loss of $8,370."

He acknowledged certain limitations of the study, including the fact that data used in the analysis were retrieved by CPT code search. "Hospital readmission costs were not included, which leads to underestimation of the costs," he added.

Dr. Reynolds said that he had no relevant financial conflicts to disclose.