Creating sustainability in centers performing high-volume adult spinal deformity surgery: evaluation of the Maryland all-payer model

OBJECTIVE: The all-payer model is a healthcare payment system unique to the state of Maryland, while the Medicare Severity-Diagnosis-Related Group (MS-DRG) model is used by all other states. The purpose of this study was to investigate differences in reimbursement and inpatient length of stay (LOS) in adult spinal deformity (ASD) surgery between the all-payer and MS-DRG models. METHODS: MS-DRG reimbursements were calculated using the Centers for Medicare & Medicaid Services Web Pricer tool; reimbursements for the all-payer model were compiled from a single institution in the state of Maryland. Payments for the most frequently occurring ASD MS-DRGs (codes 453, 454, 455, 456, 457, 458, and 460) were analyzed for fiscal years 2018-2023. The mean inpatient LOS was calculated for each MS-DRG code and reimbursement model. RESULTS: When comparing 416 MS-DRG and 1783 all-payer model accounts, the overall mean reimbursements for ASD surgery were significantly lower under the MS-DRG model ($59,199 vs $77,246, p < 0.001). The mean reimbursement payments for MS-DRG codes 453, 454, 455, 456, 457, and 460 were significantly higher under the Maryland all-payer model (p < 0.001). The mean LOS was significantly shorter in the all-payer model for MS-DRG code 453 (p = 0.046) and longer for code 457 (p < 0.001). For all other codes, no significant differences in LOS were observed. CONCLUSIONS: ASD surgery reimbursements are higher overall under the Maryland all-payer model compared with the MS-DRG model. The mean inpatient LOS did not differ significantly across most MS-DRG codes, highlighting the financial viability of an all-payer model in a healthcare system.