The Surgery Problem

Did You Know?

  • The cost of surgery is twice the cost of prescription drugs;
  • The rate of cost increase is now higher for surgery than for prescription drugs;
  • The fastest growing surgeries also the most complex and expensive procedures;
  • 75% of all surgery is discretionary;
  • Rand and Dartmouth estimate that 20-33% of discretionary surgery may be unnecessary;
  • 35% of all medical errors are associated with surgery.

Lack of Patient Education and Misaligned Incentives are the Major Drivers of Surgery Cost

Only one quarter of surgery costs are incurred for emergency or non-elective procedures. The rest are for discretionary surgeries - where plan members have treatment alternatives. In many cases, the alternatives are not only less invasive and less costly, but they can be more effective as well.

Why do members choose these discretionary surgeries? There are many factors - physician practice patterns, incentives, the appeal of cutting edge, high tech innovations, bias towards the 'quick fix' - but a key determinant is the uninformed patient. Plan members simply are not aware of all the risks and consequences associated with the surgeries they choose, or in many cases, of the existence of treatment alternatives. Studies have shown that educated patients make better treatment choices and have fewer complications even when undergoing surgery.


Hidden Cost
Increasing Surgeries
What we learned
Patient Choices
Incentive Structures