Commentary on A Retrospective Case-Matched Cost Comparison of Surgical Treatment of Melanoma and Nonmelanoma Skin Cancer in the Outpatient Versus Operating Room Setting

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In this issue of Dermatologic Surgery, Johnson and colleagues1 convincingly show that office excision of malignancies is overwhelmingly less expensive than excision in the operating room (OR). Many authors, me included, have used various methodologies to define this difference, but this is the first time that actual charge data has been made available.2–6 The results presented here are dramatic, and Johnson and colleagues fix the malignant excision cost in the operating room at 6.4 times that of the office, with a median cost of $11,323 for the operating room versus $1745 for the office setting.
This study is small but powerful because the cases were matched by age, sex, and skin cancer characteristics, as well as ASA anesthesia grading scale. The population treated in the hospital was not sicker than the office population and the excisions and closures were not larger. The results, therefore, are hard to explain away.
It must further be mentioned that many of the cases in the office were Mohs surgery, and the final product of removing nonmelanoma skin cancer in the operating room versus having Mohs surgery in the office results in up to 10% lower cure rates. I do not see how you can justify charging someone 6.4 times as much to deliver a lower cure rate.
There were some disturbing items in the table accompanying the article, which I verified with the authors. OR Case 3, a 0.9 cm basal cell carcinoma on the right cheek, resulted in a charge of $330,187! This was not a typographical error and was so staggering that it was not used in calculation of the median charge. OR Case 18 involved a sentinel node biopsy and was included, because it was a 0.53 mm melanoma and should not have had a sentinel node biopsy.
There were 5.4 million skin cancers treated in the United States in 2012.7 The vast majority were nonmelanoma skin cancers, with about 75,000 being malignant melanomas. Eighty percent of melanomas are less than 1 mm thick and a discussion about sentinel node biopsy is not ordinarily needed, let alone indicated. This means that about 99% of the skin cancers in the United States could be treated in the office setting. Currently, the Medicare data show that about 15% of malignant excisions are still performed in the hospital and even a greater percentage of benign excisions. This is a fruitful area to look for cost savings while actually increasing the treatment value in terms of cure rates and patient safety.
While one must be aware that this is charge data, not actual payment data, which is usually less, none the less, payers and patients should be demanding that skin cancers (and benign lesions), be treated in the office setting, rather than in a hospital. This is all the more important in an era of ultrahigh deductibles. There are some situations where general anesthesia may be required for excision, and pediatric patients come to mind, but the great majority of excisions are more efficient and safer in the office setting. Maybe all skin excisions should be required to have prior authorization before being performed in a hospital.
Johnson and colleagues have delivered a crucial piece of the skin surgical expense puzzle. Now it needs to be acted on.

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