Utilization Patterns and Costs of Ocular Amniotic Membrane Grafts in the Medicare Population.

Purpose: Recent investigations from the Office of the Inspector General and The New York Times have raised concerns about the costs to Medicare of skin substitutes, documenting pervasive fraudulent billing practices outside of ophthalmology. These investigations have not covered the use of tissue in eye care, despite similar reimbursement incentives for the use of sutureless ocular amniotic membrane grafts (AMGs). We examine the volume, cost, and clinical indications associated with sutureless AMGs in eye care.

Design: Retrospective cohort study of fee-for-service Medicare patients who received sutureless AMGs and eye care providers who bill for sutureless AMGs.

Participants: Nationally representative 20% sample of Medicare Part B claims for sutureless AMGs between 2011 and 2020.

Methods: We use longitudinal patient-level and provider-level data to specify regression models for our primary outcomes. We estimate Cox proportional hazards survival models for time-to-event analyses and logistic regression models for binary outcomes.

Main outcome measures: Clinical indications for AMG use, time from patients' first encounter with a provider to their first AMG, use of AMGs for dry eye, and costs to Medicare.

Results: Dry eye accounted for 44% of all sutureless AMG use in 2020, increased from 7% in 2011. Charges for ocular sutureless AMGs increased from $3.5 million in 2011 to $95.6 million in 2020; charges for AMGs used to treat dry eye increased from $250 000 to $41.4 million over this period. Some 28% of all claims for AMGS were submitted by 1% of providers. Patients are more likely to receive an AMG when seen by an optometrist (hazard ratio, 1.16; P < 0.001). The annual costs to Medicare for a patient with dry eye have increased dramatically among providers who use AMGs.

Conclusions: The costs to Medicare for skin substitutes are inflated by reimbursement models that encourage their use even when there is little clinical indication. These concerns may be applicable to eye care as well, where spending on amniotic membrane grafts has increased dramatically, particularly for indications where clinical benefit may be limited. By requiring AMG manufacturers to report accurate sales prices, policymakers could reduce costs without limiting coverage of AMGs for appropriate clinical indications.

Financial disclosure(s): Proprietary or commercial disclosure may be found after the references.