As Reimbursement for Mohs Surgery Increased, So Did Use, Study Finds

An increase in Medicare reimbursement for Mohs micrographic surgery (MMS) to remove skin cancers may be linked to its increased usage by dermatologists compared with other less expensive procedures.

A study published last month by JAMA Network Open reviewed the total number of services, as well as overall costs, from 2012-2017 in 4 procedure categories: MMS, simple excision, shave excision, and destruction of malignant lesions.

By a wide margin, the highest average payment was for MMS, which at almost $373 in 2017 was nearly triple the next highest rate ($138 for simple excision). The average payment was $111 for destruction of malignant lesions, which includes laser surgery, electrosurgery, and cryosurgery; the lowest was $71 for shave excision.

The use rate of MMS increased by 21% from 3554 per 100,000 Medicare beneficiaries to 4293 over the 5-year period. The share of overall skin cancer surgery payments for MMS among those for the 4procedures also rose—by 10%—to 67%.

Overall, 2017, inflation-adjusted Medicare payments for MMS totaled $537 million out of the $806 million paid out overall for the 4 procedures.

“From an economic perspective, Medicare fee-for-service pricing incentivizes use of MMS compared with other modalities,” the authors wrote.

The American College of Mohs Surgery developed criteria in 2012 for the appropriate use of the procedure partly to address overuse. However, rates of using MMS instead rose among the Medicare population.

The authors wrote that further study should “evaluate whether the increasing use of MMS is improving value.” They proposed adjusting the incentives caused by the high reimbursement rate for MMS by linking payments to adherence to the appropriate use criteria. They also said that if Medicare provided a fixed, bundled payment for removal of newly diagnosed skin cancers, it might increase the usage of less expensive procedures.

Although overall expenditures on MMS have increased, the average payment has declined. The average payment in 2012 was $387, falling on an inflation-adjusted basis over the 5-year period by more than $14.

Skin cancers represent the most common malignant neoplasms in the United States. They account for more than $8 billion of health expenditure per year. The number of cases overall has been increasing as the US population continue to age.

Average payments declined for each of the procedure categories except shave excision from 2012-2017. The usage rate for all the procedures declined as well. Total expenditures fell for simple excision and destruction of malignant lesions, while they rose for MMS and shave excision.

In 2017, the share of overall skin cancer surgery expenditures for the procedures besides MMS were 13% for simple excision, 12% for destruction of malignant lesion, and 8%t for shave excision.

Reference

Puri P, Baliga S, Pittelkow JR, Bhullar, PK, and Mangold AR. Use of skin cancer procedures, Medicare reimbursement, and overall expenditures. JAMA Netw Open. Published online November 10, 2020. doi:10.1001/jamanetworkopen.2020.25139