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Case Volume Justification of 3D-Navigated Spinal Procedures: A Cost-Benefit Analysis

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Abstract

3D image-guidance platforms have transformed spinal surgery by enhancing visualization, increasing precision, and improving patient outcomes. However, with high procurement, operational, and maintenance costs relative to the standard of care, the benefits of acquiring these platforms must be thoroughly assessed. This study aims to develop a model that weighs the cost of a typical 3D navigation platform against its clinical benefits to determine the facility case volume required to justify its purchase. Using Medtronic’s StealthStation and O-Arm as a market example, we calculated the break-even case volume by dividing the cost of the platform by the difference in gross margins between 3D navigation and the standard of care. Total gross margins earned from first-time and revision surgeries were calculated based on each payer’s reimbursement rate and covered case volume, as well as each technology’s revision rate. Values reported in literature and by Centers for Medicare and Medicaid Services databases were plugged into the model to calculate variables. At a 0% reimbursement rate from private payers for revision surgeries, an annual case volume of 158 spinal surgeries would be required to justify the per-year 3D navigation cost; at 100% private payer reimbursement, 352 surgeries would be required. Given these volumes, 61% of all US inpatient facilities cannot justify 3D navigation at 0% reimbursement, and 86% cannot justify it at 100% reimbursement. Accordingly, greater pricing flexibility, such as per-procedure models, is required for 3D navigation systems to standardize clinical outcomes across medical centers.

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Data availability

All data used to generate the model described are cited throughout the manuscript. The full model is available from the corresponding author upon reasonable request.

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Acknowledgements

We would like to thank Dr. Ajit Singh, Adjunct Professor in Radiology / Molecular Imaging at Stanford University, for his mentorship and review of this research.

Funding

The authors did not receive support from any organization for the submitted work.

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Authors and Affiliations

  1. Icahn School of Medicine at Mount Sinai, New York, NY, USA

    Ikaasa Suri

  2. Department of Neurosurgery, Mount Sinai Hospital, New York, NY, USA

    Ikaasa Suri

  3. Illuminant Surgical, Inc., Cambridge, MA, USA

    Ikaasa Suri & James Hu

  4. Stern School of Business, New York University, New York, NY, USA

    Mehr Suri

  5. Sloan School of Management, Massachusetts Institute of Technology, Cambridge, MA, USA

    Siddarth Ketan Dedhia

  6. Department of Neurosurgery, Houston Methodist Hospital, Houston, TX, USA

    Kurt Yaeger

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  5. Kurt Yaeger
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Contributions

I.S. conceptualized this project. I.S. and M.S. wrote the main manuscript text and prepared Tables 1-3. I.S. and S.D. developed the model used as the basis of this manuscript. All authors reviewed the manuscript.

Corresponding author

Correspondence to Ikaasa Suri.

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Conflicts of interest / competing interests

Financial interests: Ikaasa Suri and James Hu are employees and stockholders of Illuminant Surgical, Inc. Mehr Suri is an employee and stockholder of Hinge Health. Kurt Yaeger is a stockholder of Illuminant Surgical, Inc. Neither Illuminant Surgical, Inc. nor Hinge Health are impacted by this research. Non-Financial interests: None.

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Suri, I., Suri, M., Hu, J. et al. Case Volume Justification of 3D-Navigated Spinal Procedures: A Cost-Benefit Analysis. J Med Syst 47, 114 (2023). https://doi.org/10.1007/s10916-023-02000-8

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