How to effectively manage organ transplant costs

As the number of organ transplants in the United States grows each year, health plans, employers, reinsurers and third-party administrators face an increasing cost burden related to these vital but expensive procedures. The average billed cost for a transplant episode today is nearly $743,000 — and can extend well beyond $1 million.¹

The number of transplant cases in the U.S. hit a new record in 2023, with more than 46,000 Americans receiving a new organ — a nearly 9% increase over 2022 and a surge of more than 25% over the last 5 years.²

Many issues contribute to the high cost and price variability of a transplant. Transplant cases occur unexpectedly — whenever a donor organ becomes available. Costs can vary widely based on organ type, transplant facility, geography and other factors.

To contain these costs and manage financial risks related to organ transplants, today’s employers and other payers need specialized help. Analyzing these high-dollar claims — which involves carefully deconstructing the many clinical, networking and coding nuances that mount in a complex claim — requires additional expertise and resources.

Automation can help speed these reviews, but it may deliver suboptimal results if used alone. Errors in complex claims can only be caught by physician reviewers with the clinical experience to spot mistakes.

Estimated U.S. average cost per transplant episode, from 30 days prior to transplant through 180 days post-transplant:

• $1.7 million for a heart
• $878,000 for a liver
• $440,000 for a kidney³

Transplant care is highly specialized and generally spans months, both before and after surgery. A single transplant episode creates not only a lengthy inpatient stay, but also multiple physician bills, outpatient post-op bills, follow-up visits and expensive antirejection medications — not to mention any treatment of complications or hospital readmissions.

In such a complex billing environment, errors are common. Although numbers vary, one study from Medical Billing Advocates of America estimates that up to 80% of medical bills contain errors — a statistic that suggests that tens of thousands of bills each year related to organ transplants have mistakes.⁴ 

They can include everything from additional physician fees that are unrelated to the transplant to charges for routine services and medical equipment that are not separately reimbursable.

Centers for Medicare & Medicaid Services (CMS) rules allow substantial markups for a wide range of expenses related to organ acquisition, from transplant physician and staff salaries to building depreciation and the cost of maintaining an organ waiting list.⁵

Because it stands as one of the few remaining services reimbursed on a cost-plus basis, providers are not inclined to contain costs.

To manage the financial risk posed by these high-dollar claims, payers need to tap physician advisors who are well-versed in the clinical and coding details specific to transplants.

They should also pay special attention to a transplant case’s facility fees, which can run roughly half the total cost of care6 and, with the right approach, may ultimately be reduced by more than $100,000 payable.⁷

The recent rise of artificial intelligence has raised the possibility of automating clinical documentation review and coding to support accuracy, efficiency and revenue integrity.

Given the reality that itemized medical bills include hundreds of pages and thousands of non-standard line item descriptions,⁸ technology that streamlines the review process is critical to identifying billing errors and avoiding unnecessary costs.

Today’s best-in-class payment integrity programs use advanced natural language processing (NLP) to normalize charge descriptions. Then they apply rules to determine if charges have a high probability of being inaccurate — ultimately saving time and allowing clinical experts to focus on complex claims with likely mistakes.

However, automation is simply not enough to manage highly complex transplant claims. Physician reviewers must play a critical role, identifying and delving into providers and centers with atypical billing patterns while paying particular attention to room and board acuity levels, non-covered services, coding errors and more.

This expertise can make all the difference in financial outcomes. In one high-performing payment integrity plan, 60% to 75% of targeted claims reviewed showed errors, saving clients 16% to 24% of total claims dollars reviewed.⁹ These experts go beyond merely identifying billing errors — they also work hard to establish strong provider relationships and prevent future mistakes.

By being fully transparent with providers regarding potential problems and remediation methodologies, they can address problematic billing trends. Optum offers on-site provider reviews to build rapport with the provider while encouraging collaboration and a focus on education to prevent future errors.

Employers and other payers know there’s a lot at stake when it comes to high-dollar organ transplant claims. As these services increase in both frequency and complexity, so do potential billing errors.

Accordingly, payers need additional help to create a comprehensive claims review strategy that catches claim errors and increases payment accuracy.

Learn how our Transplant Solutions and Focused Claims Review for health plans can work together to help lower medical spend, increase provider satisfaction and ensure that patients in need of a transplant will continue to get their second chance at life.