Out-of-pocket Costs and Surprise Billing in Otolaryngology: A National Database Analysis

Introduction: Out-of-pocket (OOP) costs and surprise billing for surgery can lead to financial distress for patients. Recent national policy reforms, including the No Surprises Act, aim to protect patients from unexpected medical bills for out-of-network services, but concerns remain, with little known about implications in otolaryngology.

Methods: We conducted a retrospective cohort study using the Truven Marketscan national claims database. Patients aged 18-64 who underwent any of 6 otolaryngology procedures (thyroidectomy, parotidectomy, hypoglossal nerve stimulator implantation, drug induced sleep endoscopy, septoplasty, and tonsillectomy) from 2014-2022 were analyzed. Costs were adjusted to 2024 dollars and winsorized to the 1st and 99th percentiles. A potential surprise bill was defined as an out-of-network claim for an encounter where both the primary surgeon and facility were in-network. Non-parametric testing and log-normal models with back-transformation were used for cost data; logistic regression modeling was used to evaluate predictors of surprise billing.

Results: Of 58,772 procedures meeting inclusion criteria, 52,131 (89%) procedures were outpatient and 6,641 (11%) were inpatient. Median (IQR) total OOP costs were $1207 ($183-$2594), and co-insurance accounted for 66% of OOP costs. OOP costs were higher for patients with fee-for-service based (2.9 times; p< 0.001) or high-deductible insurance plans (4.7 times; p< 0.001) versus managed care plans. A potential surprise bill accompanied 4.8% of surgical encounters, which was associated with significantly higher OOP costs (Median $1739 vs. $1269; p< 0.001). The odds of having a potential surprise bill were lower in 2022 compared to 2014-2021 (OR 0.29, 95% CI 0.21-0.40; p< 0.001).

Conclusions: Common elective otolaryngology procedures were associated with significant OOP expenditures, potentially exceeding reserve funds of many patients. Potential surprise bills decreased after passage of the No Surprises Act, but these charges were not eliminated and remained associated with higher OOP costs.