Use and Costs of Bariatric Surgery and Prescription Weight-Loss Medications

William E. Encinosa; Didem M. Bernard; Claudia A. Steiner; Chi-Chang Chen

Disclosures

Health Affairs. 2005;24(4):1039-1046. 

In This Article

Study Results

Table 1 presents national estimates for use, total hospital costs, and cost per surgery by payer based on the NIS data. The total number of surgeries more than quadrupled, from an estimated 13,386 in 1998 to 71,733 in 2002. In 2002, privately insured patients accounted for 83 percent of surgeries, while Medicare, Medicaid, and self-pay accounted for 6, 5, and 3 percent, respectively. The remaining 3 percent were paid for by other government sources, a military plan for civilians, and charity.

National hospital costs for bariatric surgeries increased more than sixfold, from an estimated $157 million in 1998 to $948 million in 2002, in constant 2002 dollars.[9] Mean cost per surgery increased 12.9 percent, from $11,705 in 1998 to $13,215 in 2002. The largest increase in average costs was for Medicaid-covered surgeries, with an increase of 17.7 percent, despite a decline in length-of-stay from 5.8 days to 4.9 days (data not shown).

Table 2 presents national estimates of the number of surgeries, lengths-of-stay, and inpatient death rates, by age and sex. Focusing on 2002, patients ages 18-54 accounted for 88 percent of all surgeries, while the near-elderly (ages 55-64) accounted for 11 percent. Adolescents and the elderly accounted for the remaining 1 percent.[10] The fastest growth in bariatric surgeries between 1998 and 2002—a tenfold increase—occurred among the near-elderly.

Overall, lengths-of-stay declined 24 percent for all surgeries, and the inpatient death rate declined 64 percent ( Table 2 ). Both length-of-stay and mortality generally increased with age.

Women were more likely than men to undergo bariatric surgery in both years. In 2002 women accounted for 84 percent of all surgeries. However, both lengths-of-stay and inpatient death rates were higher among men. Although the inpatient death rate for men declined greatly between 1998 and 2002, it was still three times higher than the rate among women.

Based on national estimates of surgeries for 2002,we next estimated the prevalence of bariatric surgery among those who were clinically eligible.[11] Using the clinical guidelines described above,we estimated that there were at least 11.5 million adults eligible for bariatric surgery in 2002.[12] Adjusting for multiple surgeries per patient, we estimated that there were a total of 70,124 adult bariatric patients in 2002.[13] Thus, of the 11.5 million adults who were clinically eligible for the surgery, only 0.6 percent received the surgery in 2002.

Table 3 presents use and spending by type of surgery, using the 2002 Medstat employer data. While Table 2 presents hospital costs, Table 3 presents the prices actually transacted. In 2002 theaverage pricefor asurgical procedure was $19,346. Physician payments accounted for 14 percent ($2,667), while hospital payments accounted for 86 percent ($16,679) of total payments.[14] On average, patients paid 3.3 percent of expenditures in the form of copayments or deductibles, and health plans paid the remainder.

Detailed information in the Medstat data (CPT-4 codes for procedures) enabled us to examine use and spending by type of bariatric surgery. Table 3 groups the surgeries into four types. The first type (gastric banding and gastroplasty without bypass) simply reduces the size of the stomach, either by stapling the stomach (gastroplasty) or by placing a tight band around the stomach. The second type (Roux-en-Y gastric bypass) includes a reduction in the size of the stomach and a bypassing of part of the intestines to reduce the absorption of food. The third type (other gastric bypass) is a more advanced technique in which longer lengths of the intestine are bypassed under bilopancreatic diversion or duodenal switch gastric bypass.[15] Thefourthtypeofsurgery (revision only) is a follow-up surgery that may involve readjusting the band, revising the surgical joining of the bypass, or dealing with a complication.

The less intensive banding, or gastroplasty without gastric bypass, accounted for 4 percent of surgeries, while Roux-en-Y gastric bypasses accounted for 84.7 percent. Other gastric bypasses made up 9.2 percent of surgeries, while revision-only surgeries accounted for the remaining 2 percent. Payments increased as surgeries became more advanced from banding/gastroplasty to Roux-en-Y to other gastric bypass. Also, doctors were paid more as the surgeries became more advanced.

We also found that payments varied by the type of health plan. For example, for Roux-en-Y, the average total payment was only $16,222 under capitated health maintenance organizations (HMOs). For fee-for-service plans, point-of-service HMOs, and preferred provider organizations (PPOs), the total payments were $17,749, $20,154, and $21,698, respectively. Length-of-stay was 3.9 days for all health plans.

Bariatric surgeries may be conducted in two ways. The non-laparoscopic approach requires the abdomen to be opened, while the laparoscopic method is a less invasive method in which surgeons, guided by a video camera, gain access to the abdomen through several small incisions. Fourteen percent of bariatric surgeries were laparoscopic (94 percent of these laparoscopies occurred in Roux-en-Y bypass). Laparoscopic surgeries were less costly than non-laparoscopic surgeries; however, doctors were paid 6 percent more for laparoscopy ( Table 3 ). Moreover, the patient's out-of-pocket payment was 75 percent higher for laparoscopy.

Of all surgeries, 3.8 percent involved a revision; 2 percent had a revision during a follow-up surgery, and 1.8 percent, during the initial surgery. Surgeries with revisions were 37 percent more costly than surgeries without revisions ( Table 3 ).

As of 2002, eight drugs had been approved for weight loss. Of these, sibutramine (Meridia) and orlistat (Xenical) are approved for up to two years of use.[16] The other medications are sympathomimetic amphetamine-like drugs: phentermine, phenylpropanolamine, benzphetamine, phendimetrazine, diethylpropion, and mazindol.[17] These amphetamine-like drugs are labeled for short-term use (up to twelve weeks).[18] Orlistat is a lipase inhibitor, which blocks fat absorption, while the other seven drugs are appetite suppressants.

Table 4 presents prescription weight-loss medication use and spending among the 2002 Medstatemployersample. Of the 5.1 million with drug coverage, about 4 million had bar-iatric drug coverage. Of that 4 million, 21,931 used bariatric prescription drugs. Among the users, 45 percent used orlistat, 30 percent used sibutramine, and 35 percent used sympathomimetics (10 percent used multiple drugs). Close to 71 percent of the sympathomimetic prescriptions were for phentermine.

Although orlistat and sibutramine are recommended for long-term use (up to two years), the average number of days of medication supplied per patient per year was 110 days for orlistat and 102 days for sibutramine. This may suggest that the discomfort of side effects reduces adherence.[19] The average number of days of medication supplied per patient per year was 111 days for sympathomimetics. The average total supply of drugs per patient per year was 118 days, which reflects the fact that 10 percent of patients in the data took multiple weight-loss medications.

Patients spent an average of $304 each for weight-loss medications each year; patients paid 26 percent of this amount, and health plans, 74 percent. This annual total payment per person increased with age, from $192 per person for ages 8-17 to $361 for ages 55-64. Although only 22 percent of users were men, men spent more on average on the drugs than women ($327 versus $297), because men used these drugs longer than women (122 days versus 117 days per year) and because a greater proportion of men than women used the most costly drug, orlistat (44 percent versus 36 percent) (data not shown).

Finally, we estimated the prevalence of bar-iatric medicine use among obese adults with employer coverage for the drugs. From our 2002 MarketScan sample, we estimated that 918,000 non-elderly adults with bariatric drug coverage were clinically eligible to use bariatric prescription drugs.[20] However, only 21,797 (2.4 percent) of these adults took bariatric medications.

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