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Abdominal Imaging
ISSN 0942-8925
Abdom Imaging
DOI 10.1007/s00261-015-0538-1
Medicare cost of colorectal cancer
screening: CT colonography vs. optical
colonoscopy
Bruce Pyenson, Perry J.Pickhardt, Tia
Goss Sawhney & Michele Berrios
1 23
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Medicare cost of colorectal cancer screening:
CT colonography vs. optical colonoscopy
Bruce Pyenson,
1
Perry J. Pickhardt,
2
Tia Goss Sawhney,
1
Michele Berrios
1
1
Milliman, One Pennsylvania Plaza, 38th Floor, New York, NY 10019, USA
2
University of Wisconsin School of Medicine & Public Health, Madison, WI, USA
Abstract
Purpose: To compare the Medicare population cost of
colorectal cancer (CRC) screening of average risk individ-
uals by CT colonography (CTC) vs. optical colonoscopy
(OC). Methods: The authors used Medicare claims data, fee
schedules, established protocols, and other sources to esti-
mate CTC and OC per-screen costs, including the costs of
OC referrals for a subset of CTC patients. They then
modeled and compared the Medicare costs of patients who
complied with CTC and OC screening recommendations
and tested alternative scenarios. Results: CTC is 29% less
expensive than OC for the Medicare population in the base
scenario. Although the CTC cost advantage is increased or
reduced under alternative scenarios, it is always positive.
Conclusion: CTC is a cost-effective CRC screening option
for the Medicare population and will likely reduce Medicare
expenditures for CRC screening.
Key words: CT colonography—Optical
colonoscopy—Medicare—Costs—Cost-effectiveness
Abbreviations
ACR American College of Radiology
ACG American College of Gast roenterologists
ACS American Cancer Society
AGA American Gastroenterological Association
ASGE American Society for Gastrointestinal
Endoscopy
CMS Centers of Medicare and Medicaid Services
CPTÒ Current procedural terminology, a registered
trademark
Ò
of the American Medical Associ-
ation (AMA)
CRC Colorectal cancer
CTC CT colonography
HCPS Healthcare common procedure coding system
HOPD Hospital outpatient department
IV Intravenous
OC Optical colonography
OPPS Outpatient prospective payment system
USPSTF US Preventative Services Task Force
The United States Preventive Services Task Force
(USPSTF) is reevaluating the evidence for colorectal
cancer (CRC) screening, including the efficacy of CT
colonography (C TC) [1]. The USPSTF will assign a
grade of A or B to CTC screening if they find sufficient
evidence to substantiate CTC screening which provides
a net population health benefit [2 ]. Based on currently
available data, some experts believe that the USPSTF
will give an A or B grade to CTC screening [3, 4], which
would require private health insurance plans to cover
CTC screening [5 ]. Medicaid plans would also be re-
quired to cover CTC screening for Affordable Care Act
‘‘expansion adult’’ enrollees [6] and for all enroll ees if
the state has an extra federal matc h for USPSTF pre-
ventative services [7]. While Medicare often follows
USPSTF’s lead, Medicare is not required to cover
USPSTF A and B services and may make its own
coverage decision [8].
Medicare policy has been guided by the ‘‘triple aim’’
since 2010 [9]. The triple aims are to
1. Improve the patient experience of care (including
quality and satisfaction),
2. Improve the health of populations, and
3. Reduce the per capita cost of health care [10].
Providing Medicare enrollees access to CTC for CRC
screening should improve patient adherence to American
Cancer Society (ACS) CRC screening guidelines and
patient satisfaction [3, 11, 12]. CTC offers distinct
Electronic supplementary material: The online version of this article
(doi:10.1007/s00261-015-0538-1) contains supplementary material,
which is available to authorized users.
Correspondence to: Bruce Pyenson; email: bruce.pyenson@milliman.
com
ª
The Author(s) 2015. This article is published
with open access at Springerlink.com
Abdominal
Imaging
Abdom Imaging (2015)
DOI: 10.1007/s00261-015-0538-1
advantages for Medicare enrollees compared to optical
colonoscopy (OC or simply ‘‘colonoscopy’’): CTC is less
invasive, has fewer complications, and needs no anes-
thesia. No anesthesia avoids the need for an escort for
the patient post-procedure. Medicare coverage of CTC is
therefore consistent with the first two goals of the triple
aim.
This paper addresses cost, the third goal of the triple
aim. Officially, Medicare does not consider cost in its
coverage determ inations. However, the prominence of
the triple aim, the push toward ‘‘value-based care’’ [13],
budgetary stress, and analysis of recent coverage deci-
sions have led some to conclude that cost is likely a
factor in Medicare coverage decisions [14]. Furthermore,
private Medicare Advantage plans now cover over 30%
of Medicar e enrollees [15], and they are permitted to
cover services not covered by Medicare [16]. Cost is
critically important for private payer plans.
The last published evaluation of the relative cost of
CTC to OC for Medicare was prepared in 2009 using
Medicare OC fees from 2007 [17]. With substantial
changes in reimbursement and clinical practices in recent
years and additional evidence demonstrating similar
efficacy of CTC and OC, this paper fills an important
gap.
Methods
We estimated the per-screen costs of OC and CTC, the
frequency of colonic and extra -colonic screening findings
and the resulting rescr een times, the size and demo-
graphic mix of the Medicare population, and built a
simulation model to produce Medicare population-level
cost comparisons of the two screening methods. In
addition, we tested several alternative scenarios.
Throughout this paper, ‘‘costs’’ refers to Medicare al-
lowed amounts, which include the Medicare payment
and the enrollee cost sharing payment. For bowel
preparation agents, the allowed amounts are those
administered by the Medicare Part D insurer.
OC per-screen costs
We used the 2013 Medicare 5% Sample of Medicare Part
A and Part B enrollment and claims as our primary data
source for OC costs [18]. We adjusted the claim costs for
changes in Medicare fee schedules between 2013 and
2015 and, because the 5% Sample does not contain pre-
scription drug data, separately developed costs for bowel
preparation agents. To include all colonoscopy-related
costs, we collected all costs for the day of a colonoscopy
(a ‘‘colonoscopy day’’) and excluded the costs clearly not
related to the colonoscopy. We separately quantified the
cost of colonoscopies with and without biopsies.
We limited the OC cost analysis to Medicare enrollees
with Medicare Part A and Part B coverage. We excluded
Medicare Advantage and other capitated enrollees as
claims are unreliable [19]. We identified an enrollee as
having a colonoscopy day by the presence of a non-inpa-
tient professional or technical claim with an allowed charge
greater than $0 and a Healthcare Common Procedure
Coding System (HCPCS) code or Current Procedural
Terminology (CPT
Ò
) code for a colonoscopy (Table 1).
Most colonoscopies have both professional and
technical claims. We classified the colonoscopy day as
screening if we found either a professional and/or a
technical claim with a HCPCS code indicating screening,
a diagnostic colonoscopy CPT code accompanied by a
diagnosis code indicating screening, or a procedure
modifier code indicating either a screening or a preven-
tive service. We excluded colonoscopy days with proce-
dure modifiers indicating reduced servi ces or an
incomplete procedure (less than 2% of colonoscopy
days). See Table 1.
We classified a colonoscopy day as having a biopsy if
there was a same-day professional and/or technical claim
that indicated a biopsy, or we found one or more same-
day colon biopsy pathology claims (Table 1). More than
95% of colonoscopies coded as a biopsy were accompa-
nied by a pathology claim. We classified a colonoscopy
day as having an anesthesia service if we identified a
same-day professional outpatient anesthesia claim.
We excluded somewhat more than 10% of the
screening colonoscopy days because they included both
colonoscopies and upper endoscopies. We excluded co-
lonoscopy days for patients under age 50 (less than 2%).
Within a colonoscopy day, we excluded costs not directly
relevant to screening colonoscopies, including inpatient
services, emergency room services, prescription drugs,
and durable medical equipment, totaling less than 2% of
the total costs. A portion of these costs may be relevant
to screening complications. We later tested for the
potential cost impact of complications.
Colonoscopy bowel preparation costs (cathartic
agents) are not covered under Medicare Part A or Par t B
but are covered under Medicare Part D. About 67% of
Medicare beneficiaries with Parts A and B also have Part
D. Separate, detailed Part D sp ending data were recently
released [20]. Within the Part D data, we examined the
cathartic agents prescribed by gastroenterologists and
found the average cost for the American Society for
Gastrointestinal Endoscopy (ASGE) recommended
polyethylene glycol (PEG)-based preparations, such as
MoviPrep and GaviLyte, and sodium phosphate-based
preparations such as Suprep [21]. We note that some
physicians recommend OTC cathartic agents that cost
less than these agents and are not paid for by Medicare
Part D [22].
B. Pyenson et al.: Medicare cost of colorectal cancer screening
In order to project the historical 2013 data to reflect
2015 cost levels, we calculated a weighted average 2013
to 2015 Medicare cost trend for the most frequent co-
lonoscopy HCPCS (or CPT) codes, by site of service,
using Medicare fee schedules. We applied the 2013 site of
service distribution derived from colonoscopy claims
identified in the Medicare 5% Sample, and estimated the
per-unit colonoscopy costs for 2015.
CTC per-screen costs
Since Medicare currently does not have a fee for
screening CTC, we used the current Medicare fee
schedule for diagnostic CTC without intravenous (IV)
contrast (CPT code 74261) for screening CTC. Since
CTC requirements are similar for screening and non-
contrast diagnostic purposes [23], we expect that Medi-
care reimbursem ent will be the same for a screening CTC
as it is for a diagnostic CTC without IV contrast. Under
Medicare’s fee system, the fee for diagnostic CTC has
two components: professional and technical. The Medi-
care Physician Fee Schedule (MPFS) for the professional
services applies across all sites of service. Technical ser-
vice fees may be, however, site specific. While the tech-
nical component CTC fee for physician offices/clinics per
the MPFS is substantially higher than for hospital out-
patient departments (HOPDs), the Outpatient Prospec-
tive Payment System (OPPS), Section 5102(b) of the
Deficit Reduction Act of 2005 limits payment for the
technical component of imaging services to the lesser of
the MPFS or the OPPS fees [24, 25]. Therefore, the 2015
national Medicare fee for diagnostic CTC is the same
across settings (unlike colonoscopy).
Guidelines recommend that CTC bowel prep includes
the use of cathartic and oral contrast tagging agents [23,
26, 27]. The recommended cathartic agents are the same
as those for OC bowel preparation. Oral contrast tagging
agents are included in the CTC fee, and no extra
amounts for the tagging agents are billable to Medicare
or the patient.
According to the American College of Radiology
(ACR) and ACS Guidelines [23, 28], CTC patients with
polyps 6+ mm should be offered follow-up OC with
polypectomy. For patients with follow-up OC, we added
the colonoscopy with biopsy fees to the CTC costs.
Screening findings, OC follow-up, and rescree n
times
The size of the largest polyp is the most important
finding for determining the CRC rescr een times and
whether a CTC patient will have follow-up OC. The
commonly reported size categories are 5 mm or smaller
(diminutive), 6–9 mm (small), and 10 mm and larger
(large). Other relevant characteristics for OC polyp
findings include the total number of polyps, carcinoma
status, adenoma status, hyperplasia status and grade,
and other descriptors (hyperplastic, tubu lar, sessile, and
Table 1. Colonoscopy codes
Code indicates
HCPCS/ CPT
Ò
code Code description Screening Biopsy
G0121
a
Colorectal cancer screening; colonoscopy on individual not meeting criteria for high risk Always No
c
G0105
a
Colorectal cancer screening; colonoscopy on individual at high risk Always No
c
45378 Colonoscopy, flexible, proximal to splenic flexure; diagnostic, with or
without collection of specimen(s) by brushing or washing, with or
without colon decompression (separate procedure)
Maybe
b
No
c
45379 Colonoscopy, with removal of foreign body Maybe
b
No
c
45380 Colonoscopy, with biopsy, single or multiple Maybe
b
Always
45381 Colonoscopy, with directed submucosal injection(s), any substance Maybe
b
Always
45382 Colonoscopy, with control of bleeding (e.g., injection, bipolar cautery,
unipolar cautery, laser, heater probe, stapler, plasma coagulator)
Maybe
b
Always
45383 Colonoscopy, with ablation of tumor(s), polyp(s) or other lesion(s)
not amenable to removal by hot biopsy forceps, bipolar cautery, or snare technique
Maybe
b
Always
45384 Colonoscopy, with removal of tumor(s), polyp(s), or other lesion(s)
by hot biopsy forceps or bipolar cautery
Maybe
b
Always
45385 Colonoscopy, with removal of tumor(s), polyp(s), or other lesions by snare technique Maybe
b
Always
45386 Colonoscopy, with dilation by balloon, 1 or more strictures Maybe
b
No
c
45387 Colonoscopy, with transendoscopic stent placement (includes predilation) Maybe
b
No
c
45391 Colonoscopy, with endoscopic ultrasound examination Maybe
b
No
c
45392 Colonoscopy, with transendoscopic ultrasound-guided intramural
or transmural fine-needle aspiration/biopsy(s)
Maybe
b
No
c
a
Code is used only by Medicare, specifically for screening colonoscopies
b
If accompanied by an ICD-9-CM diagnosis code of V7651 (screen for malignant neoplasm-colon), a procedure modifier code of PT (colorectal
cancer screening test, converted to a diagnostic test or other procedure), or a procedure modifier code of 33 (preventative service)
c
A separate same-day claim for CPT code 88305 (Level IV—Surgical pathology—colon biopsy, Lymph node biopsy, Colorectal Polyp) indicates a
biopsy
B. Pyenson et al.: Medicare cost of colorectal cancer screening
serrated) [29]. The current OC standard of care, sug-
gested by the ACS [30] and American College of Gas-
troenterology (ACG) [31] guidelines and encouraged by
quality of care measures for adenoma detection rate and
polypectomy rate [32, 33], is for physicians to remove all
polyps, irrespective of size.
We combined the probability of large polyps reported
by Lieberman [34] with the relative risk factor for small
and diminutive polyps as reported by Lowenfels [35]to
produce a table of polyp size findings by age and sex. The
Lieberman and Lowenfels studies used data centered at
approximately 2005. The literature suggests that
colonoscopists are being asked to find and remove even
diminutive polyps [32, 33, 36]. To account for increased
polyp detection rates in recent years and Medicare’s
demographics, we used Lieberman’s probability for large
polyps, Lowenfels’ probability of small polyps relative to
large polyps, and the results of our Medicare 5% Sample
analysis for the probability of any polyp, with the
probability of a diminutive polyp as the difference be-
tween the probability of any polyp and the sum of the
probabilities of large and small polyps. See the Appendix
in supplementary material for sample calculations.
We used the same large and small polyp detection
rates for both OC and CTC. We ignored diminutive
polyps potentially identified by CTC as they are not re-
ported in isolation and do not impact rescreen time [23].
The literature indicates that CTC screenings may be ei-
ther as sensitive or somewhat less sensitive as OC
screenings for large and smal l polyp detection [37].
Assuming less sensitivity for CTC would lower CTC
costs as fewer patients would be offered OC.
For OC, the consensus guidelines of the US Multi-
Society Task Force on Colorectal Cancer as published by
the AGA Institute recommend rescreening of average
risk individuals
1
in 10 years if no polyps are found and,
except for rare findings,
2
between 3 and 10 years if
polyps are found. Specific recommendations depend on
the number of polyps and their characteristics [29]. We
modeled estimates of the number of polyps and their
characteristics in order to estimate the average, guideline
based, years to OC rescreen.
The CTC guidelines of the AC R [23], the ACS [28],
and the US Multi-Society Task Force on Colorectal
Cancer recommend that patients with polyps 6+ mm
(small and large) are to be offered follow-up OC [ 29].
The ACS guideline acknowledges that some patients with
small polyps will opt for surveillance. We assumed that
100% of the CTC patients with large polyps and 50% of
patients with small polyps will have follow-up OC. The
50% assumptions are in the range reported informally by
practicing CTC radiologists, although given the lack of
published data, we tested alternative rates via scenario
testing.
The CTC guidelines of the ACG and the ACS rec-
ommend CTC every 5 years, and the Working Group on
Virtual Colonoscopy recommends CTC every 5–10 years
[23, 30, 31, 38]. Since the ACR [39] does not recommend
reporting diminutive polyps, we assume a 5-year interval
for individuals with no polyps or diminutive polyps. The
CTC guidelines are not specific, however, for the
rescreening intervals of patients with previous small or
large polyps. We assumed that the rescreen interval will
be the minimum of the OC rescr een interval or 5 years.
We assumed CRC screening would start at age 50,
which is consistent with the guideline recommendations
of the USPSTF [40], the ACS [30], and the ACG [31] for
most average risk individuals.
3
The guidelines, however,
are inconsistent for the maximum age for screening.
USPSTF recommends through age 74 for most individ-
uals. The American Gastroenterological Association
(AGA) Institute and the ACG are silent with respect to
stop age and, as a payor, Medicare sets no upper age
limit [41]. Althou gh we observed a decline in Medicare
screening colonoscopy rates after age 74, 19% of
screening colonoscopies were for patients age 75–84 and
1% of colonoscopi es for patients age 85 and over. We set
the start and stop ages for our base scenario at ages 50
and 85, meaning that everyone receives their first
screening at age 50 and no one has a screening age 85 and
older.
Medicare population
CRC screening is covered under Medicare Part B. We
estimated the size of the 2015 Medicare Part B popula-
tion by age and sex by adjusting the Medicare Part B
enrollment from the 2013 Medicare 100% Sample [18]by
the ratio of 2015 [42] and 2013 [43] population estimates.
We estimated the size of the entire Medicare Part B
population. Medicare indirectly pays for the cost of CR C
screening for Medicare Advantage enrollees via Medi-
care Advantage capitation payments, and such plans
must cover all Medicare covered services.
Simulation model
To examine the cost differences between OC and CTC,
we built a simulation model that follows a population of
individuals at annual increments starting at age 50
through their screening years on an OC or a CTC path.
The model assumed perfect compliance with the screen-
ing intervals specified for each scenario, without cross
over between the two paths. The model used random
numbers and the probabilities described in Methods and
1
Individuals without a history of colorectal cancer or polyps
with high-grade dysplasia.
2
>10 adenomas or serrated polyposis syndrome.
3
The ACG recommends age 45 for African Americans.
B. Pyenson et al.: Medicare cost of colorectal cancer screening
Results to determine CTC and OC findings, whether an
OC patient has a biopsy, and whether a CTC patient
with a small polyp has a follow-up OC. The screenings
were monetized using the costs described.
We simulat ed a population of 10,000 indivi duals for
each path. We weigh ted the resulting age-sex-specific
costs and other resul ts by the 2015 Medicare age-sex
distribution to calculate Medicare population totals. We
assumed no cost inflation and no discounting. The results
are 2015 costs as if all 2015 Medicare enrollees had been
on either a CTC or OC screening path since age 50.
We used SAS Version 9.3 for data analysis and
Microsoft Excel 2010 for the simulation modeling.
Results
We identified 127,175 Medicare colonoscopies performed
in 2013 (Table 2) and classified 56,578 (44%) as screening
for purposes of calculating average costs. 46% of the
colonoscopies were excluded because the coding indi-
cated that they were diagnostic, 7% because they were
performed on the same-day as an upper endoscopy, 2%
because they were incompl ete, and 1% because the
Medicare enrollee was under age 50.
We estimated 2015 average Medicare colonoscopy
screening costs of $1,035 (Table 3), using trends esti-
mated by comparing 2013 and 2015 Medicare fees. The
average cost was higher for colonoscopies with biopsies
($1212) and lower for colonoscopies without biopsies
($824). Most of the cost difference was due to the pro-
fessional and technical fees for the co lonoscopy and not
pathology costs. Pathology costs averaged $92 for a co-
lonoscopy with biopsy. 54% of colonoscopies have a
biopsy. Costs varie d depending on the colonoscopy
codes, whether the colonoscopy involved separately bil-
led anesthesia, the site of the colonoscopy (outpatient
hospital, ambulatory surgical center, or physician office),
the number of biopsies when there is a biopsy, the bowel
preparation agent, and the providers’ locality. Under
Medicare rules, twilight sedation administered by the
colonoscopist and staff is not separately billed [44]. Deep
sedation, typically propofol, must be administered by an
anesthesiology professional and is separately billed [45].
57% of colonoscopies had separately billed anesthesia
costs. The average anesthesia cost per colonoscopy with
a separately billed anesthesia cost was $154 ($88/57%).
Bowel preparation agents were $39 of the total cost and
reflect the discount that Medicare Part D plans receive
compared to average wholesale prices.
Medicare’s 2015 national fee schedule for diagnostic
CTC without IV contrast is $243 (Table 4) of which $123
is professional and $120 is technical. We assumed that
total 2015 cost for a screening CTC is the cost of the
diagnostic CTC, the cathartic bowel preparation agent
(using same cost as for OC bowel preparation—Table 3),
and the cost of an OC with biopsy (Table 3) for the
patients with follow-on OC. The oral contrast tagging
agent(s) bowel preparation agents used specifically for
CTC (in addition to the cathartic agent) is included in the
Medicare fee and not separately billed.
Using the data so urces and assumptions described in
Methods and further described in the Appendix in sup-
plementary material, we estimated that colonoscopies for
male Medicare enroll ees’ ages 65–74 (the decade with the
highest Medicare enrollment) have approximately 10%,
12%, and 38% probabilities finding large, small, or
diminutive polyps, respectively (Table 5). Probabilities
for large and small polyps generally increase by age while
probabilities for diminutive polyps peak at ages 60–64.
Probabilities for large and small polyps were consistently
lower for females than for males but were similar for
diminutive polyps.
Table 3. 2013 and 2015 Medicare average costs for screening colonoscopies
Screening colonoscopy days Without biopsy With biopsy Total/avg
N 25,850 30,728 56,578
% n 46% 54% 100%
Actual 2013 costs per screening
Professional and technical $672 $949 $822
Anesthesia
a
(separately billed) 85 91 88
Pathology
a
09250
Bowel preparation agents 39 39 39
Total 797 1171 1000
Estimated 2015 costs per screening $824 $1212 $1035
a
Pathology and anesthesia costs are averaged across colonoscopies with and without these costs
Source: Authors’ analysis of 2013 Medicare 5% Sample data, 2013 Part D prescription drug data, and (for trend) Medicare 2013 and 2015 fee
schedules
Table 2. 2013 Medicare colonoscopies
Colonoscopy days identified Number Percentage
Total 127,175 100
Exclusions:
Diagnostic 58,206 46
Incomplete 2441 2
With same-day upper endoscopy 9139 7
Enrollee under age 50 811 1
Net remaining: screening colonoscopy days 56,578 44
Source: Authors’ analysis of 2013 Medicare 5% sample data
B. Pyenson et al.: Medicare cost of colorectal cancer screening
Guideline recommendations imply that screening OC
patients with diminutive and small polyps should be re-
screened on average in 7 or 6 years, respectively. Tabl e 6
shows the guideline and estimated average years until
rescreening, rounded to the nearest integer year, for all
OC and CTC polyps sizes. The literature indicates that
rescreens often occur sooner than recommended by
guidelines [46]; scenari o 8 tests the impact of more fre-
quent rescreens.
As of 2015, there are nearly 43 million Medicare en-
rollees’ ages 50–84 with Part B or Part C coverage, which
provides payment for colorectal cancer screeni ng. Nearly
½ (45.8%) of the enrollees are of ages 65–74 and the
majority of those are of ages 65–69. Table 7 summarizes
our estimated 2015 Medicare population by sex and 5-
year age bands. The simulation applie s the screening and
follow-up criteria to this population by sex and single
year age bands.
Table 8 summarizes the population-level statistics for
the base simulation. If all of the 2015 Medicare enrollees
had adhered with either OC or CTC screening guidelines
(paths) since the age of 50, we estimat e that there would
be 5.5 million OCs or 9.1 CTCs performed in 2015. The
volume difference is the result of an average time to re-
screen of 8.0 years for OC and 4.9 years for CTC.
The higher volume of CTC screenings is offset by a
substantially lower price. The average OC screening costs
$1,036 and the average CTC screening costs $439,
inclusive of the follow-up OC costs for 12.9% of the CTC
screens that receive follow-up OC. We estimated that
fully screening all Medicare enrollees charged $5.7 billion
for the OC path and $4.0 billion for the CTC path, $9.34
per Medicare enrollee per month for OC and $6.59 for
CTC. CTC is 29% less costly (Table 9).
Scenario tests and results
To understand the model sensitivity to certain assump-
tions and potenti al changes to OC and CTC standards
and practices, we tested several alternative scenarios.
Table 10 describes the scenarios (with more detail pro-
vided in the Appendix in supplementary material) and
explains why we selected them. Table 11 summarizes the
results of the scenarios.
Scenarios 1 through 9 produce CTC savings ranging
from 12% to 58% compared to the base scenario savings
of 29%. The 12% savings (scenario 2) results from
including estimates, using data from published research,
for the costs of OC and CTC complications and CTC
extra-colonic findings. Extra-colonic findings add costs
only to CTCs and complications add more costs to OC
than CTC. While complications never benefit the patient,
CTC extra-colonic findings, such as early detection of
other cancers or abdominal aorticaneurysm may benefit
the patient.
The cost advantage of CTC to OC diminishes when
more CTC patients with small polyps have follow-up OC
rather than surveillance or when CTC screenings are
accompanied with shared decision making consultations.
The impact of increasing from 50% to 75% the CTC
patients with small polyps having follow-up OC
Table 4. 2015 Medicare diagnostic CTC cost
Diagnostic CTC (CPT-4 code 74261) Medicare fee schedule
Professional component $123
Technical component (after payment limit) $120
Professional and technical
a
$243
a
Oral contrast tagging agent costs are included in professional and
technical fee
Source: http://www.cms.gov/apps/physician-fee-schedule/, April, 2015
Table 5. Probabilities of OC and CTC findings
Size of largest polyp
Ages None (%) <6 mm (diminutive) (%)
a
6–9 mm (small) (%) 10+ mm (large) (%) All (%)
Male
50–54 48.4 36.9 8.6 6.1 100
55–59 44.4 38.0 10.3 7.3 100
60–64 38.7 42.1 10.6 8.6 100
65–69 41.0 37.6 11.8 9.6 100
70–74 40.3 38.7 11.3 9.7 100
75–79 39.3 38.4 12.0 10.3 100
80–84 44.0 33.4 11.6 11.0 100
Female
50–54 50.4 39.2 6.4 4.0 100
55–59 47.4 40.6 7.4 4.6 100
60–64 48.1 39.4 7.3 5.2 100
65–69 50.9 35.2 8.1 5.8 100
70–74 49.4 35.7 8.5 6.4 100
75–79 48.9 34.6 9.4 7.1 100
80–84 49.4 34.6 8.7 7.3 100
a
Not used for the CTC analysis other than for scenario 9; isolated diminutive polyps identified by CTC are not reported and as a finding has the
same effect as no polyps
Source: Authors’ analysis of published literature and 2013 Medicare 5% Sample data. See Appendix in supplementary material
B. Pyenson et al.: Medicare cost of colorectal cancer screening
(scenario 7) is similar to the impact of the shared decision
encounter (scenario 4). Both reduce CTC savings by
about 4% (25% savings compared to 29% for the base
scenario). The cost impact is linear. Therefore, the im-
pact of 100% of CTC patients with small polyps having
follow-up OC or $40 shared decision costs is 8% (21%
savings compared to 29% for the base scenario).
Scenarios 1, 3, 5, 6, and 9 increase the cost advantage
of CTC to OC. Scenario 9 assumes CTC screening at the
same intervals as OC. The scenario is included to com-
pare the per-screen costs of OC and CTC without con-
sideration of the costs resulting from more frequent CTC
screenings. On a per-screen basis, inclusive of the costs
for patients with large and small polyps having follow-up
OC, CTC is nearly 60% less costly than OC screening.
Discussion
For a Medicare population, when compared to OC, CTC
satisfies the third goal of the triple aim: reducing the per
Table 6. Years to rescreen based on OC and CTC findings
Size of largest polyp
Screen Ages Sex None <6 mm (diminutive) 6–9 mm (small) 10+ mm (large)
OC All Both 10 7 6 3
CTC All Both 5 5 5 3
na Not applicable
Source: For OC, Authors’ analysis of US Multi-Society Task Force on Colorectal Cancer Guidelines [29] and published literature. For CTC, the
lesser of 5 years or the rescreen time for OC
Table 7. 2015 Medicare population (000s)
Male Female Total
Ages Enrollees % Enrollees % Enrollees %
Under 50 1511 6.7 1353 4.8 2864 5.6
50–54 729 3.2 698 2.5 1427 2.8
55–59 957 4.2 945 3.4 1902 3.7
60–64 1632 7.2 1759 6.2 3391 6.7
65–69 6005 26.5 7114 25.2 13,119 25.8
70–74 4628 20.4 5550 19.7 10,178 20.0
75–79 3254 14.4 4139 14.7 7393 14.5
80–84 2167 9.6 3122 11.1 5289 10.4
85+ 1788 7.9 3508 12.4 5296 10.4
Total all ages 22,670 100.0 28,189 100.0 50,860 100.0
Total ages 50–84 19,372 85.4 23,328 82.8 42,699 84.0
Source: Authors’ analysis of 2013 Medicare 100% sample and US Census Bureau data
Table 8. Base simulation summary statistics for the 2015 Medicare
population
Screening path
Statistic OC CTC
2015 total screenings (000s) 5501 9159
Male % 46.5% 45.8%
Female % 53.5% 54.2%
Screenings findings by size of largest
polyp
None 46.3% 45.9%
<6 mm (diminutive) 37.3% 37.4%
6–9 mm (small) 9.1% 9.5%
10+ mm (large) 7.3% 7.2%
Any size 53.7% 54.1%
6+ mm 16.4% 16.7%
CTC with follow-up OC % na 12.9%
Average cost per screening $1036 $439
Average years to rescreen 8.0 4.9
na Not applicable
Source: Authors’ simulation. Assumes all Medicare enrollees have
perfectly adhered to an OC or CTC screening path since age 50
Table 9. Base simulation results for the 2015 Medicare population
Screening path
Result OC CTC
2015 total cost ($000s) $5,699,109 $4,023,988
Cost per Medicare
enrollee per month
a
$9.34 $6.59
Cost per screening age
Medicare enrollee per month
b
$11.12 $7.85
CTC savings compared to OC 29%
a
Denominator is 2015 total Medicare population
b
Denominator is the 2015 Medicare population ages 50–84
Source: Authors’ simulation. Assumes all Medicare enrollees have
perfectly adhered to an OC or CTC screening path since age 50
B. Pyenson et al.: Medicare cost of colorectal cancer screening
Table 10. Alternative scenarios
Description Alternative model inputs Explanation
1. Fewer large and small polyps Apply a 0.80 adjustment factor to the probability of large and
small polyps and increase the probability of diminutive size
polyps by the same amount so that the probability of finding
a polyp of any size remains unchanged
Our base scenario, using data centered at approximately 2005, pro-
duces an approximately 18% aggregate probability of a large or
small polyp finding. We have found smaller studies that indicate an
aggregate probability in the 13–15% range [47–49]. Since the prob-
ability of finding a polyp of any size, however, uses recent data we
left the total probability unchanged
2. Add costs for OC and CTC com-
plications and CTC extra-colonic
findings
OC costs: add $20 and $96 to OC without and with biopsy
costs, respectively, for OC complications
We used published literature [50], trended to 2015, to estimate the costs
of complications and the follow-up diagnosis costs of CTC extra-
colonic findings. OC has more complications than CTC and within
OC, OCs with biopsies have substantially more complications than
OCs without biopsies [47, 49, 51]. See Appendix in supplementary
material for more details. The ACR currently recommends the
reporting of potentially significant extra-colonic findings [23]
CTC costs: add $131 to CTC for CTC complications and extra-
colonic findings
3. Increase anesthesia use for OC Assume that 80% of OCs will have separately billed anesthesia,
a40% increase in use and costs from the 57% base scenario
assumption
In 2013 separately billed anesthesia was subject to Medicare cost
sharing; as of January 1, 2015 it is no longer subject to cost sharing
[52]. Anesthesia use may therefore increase over the next couple of
years
4. Add costs for CTC shared decision
making
Add a $20 cost to all CTCs and another $20 cost to CTCs with
small polyps
Medicare covers CT lung cancer screening with the provision that the
first screening must include a documented shared decision making
consultation [53]. If Medicare adopts a similar approach for CTC
screening, two consultations may be required: the first for the
screening and the second for the decision for follow-up OC if the
patient has small polyps. See the Appendix in supplementary
material for more details
5. Decrease maximum screening age Decrease maximum screening age from age 84 to age 74 UPSTF recommends CRC screening until age 75. Medicare, however,
currently pays for screening for all ages 50 and over
6. Decrease OC follow-up rate for
CTCs with small polyp findings
Decrease OC follow-up rate for CTCs with small polyp findings
from 50% to 25%
No one knows how many patients with small polyps will opt for OC
polypectomy vs. CTC surveillance. The percentage will likely vary
substantially by clinic and physician7. Increase OC follow-up rate for
CTCs with small polyp findings
Increase OC follow-up rate for CTCs with small polyp findings
from 50% to 75%
8. Decrease rescreen years for both OC
and CTC for screenings with small
polyps
Rescreen in 3 years instead of the 6 years for OC and 5 for CTC Literature indicates that many OC patients rescreen sooner than rec-
ommended by guidelines [46]
9. Increase rescreen years for CTC to
match OC
Rescreen in 3, 6, 7, and 10 years for large, small, diminutive,
and no polyps, respectively
By removing the rescreen time differential, this scenario compares the
per-screen costs of CTC and OC
B. Pyenson et al.: Medicare cost of colorectal cancer screening
capita cost of health care. For our base scenario, CTC is
29% less costly than OC per Medicare enrollee. Although
the CTC cost advantage is quite variable under the
alternative scenarios, the cost advantage is positive for all
alternative scenarios (range: 12–58%).
Our methodology assumes perfect enrollee adherence
to either an OC or CTC path with no cross over between
paths. This assumption facilitates the cost comparison.
In reality, some Medicare enrollees will not be screened,
others will be screened too often or for too many years,
and others will cross between paths [46, 54, 55 ]. Because
it is less invasive, CTC may have higher compliance than
OC [11, 12]. We did not consider any of these possibilities
in our analysis.
We identified in the historical M edicare data that 2%
of colonoscopies were cod ed as incomplete, as defined by
the failure to advance the scope past the splenic fixture
[56]. Medicare reimbursement for incomplete colono-
scopies is about 1/3 of that for a complete colonoscopy
[24]; a subsequent complete colonoscopy is paid at the
full rate [56]. With CTC, there is no colonoscope to ad-
vance, and a CTC can always visualize the entire colon,
although sometimes wi th suboptimal assessment [57]. As
such, CTCs are rarely incomplete in the same sense.
Although we did not consider this difference in our
modeling, a lower rate of incomplete CTC screenings
relative to OC screenings would further favor CTC over
OC when comparing quality and cost.
We note that the probabilities we assign to polyp size
findings are ‘‘memoryless’’—findings from the last
screening, including findings of adenomatous polyps, do
not impact the modeled probabilities of findings for the
next screening. If the existence of pr ior polyps affects the
probability of future polyps, or removal of diminutive
polyps reduces the future appearance of small and large
polyps, then our results would need reconsideration.
Empirical data on this issue are quite limited.
Prior cost-effectiveness analyses vary in their reported
results but have generally shown that CTC screening is
cost-effective especially compared with no screening [58].
When typical non-Medicare charges and extra-colonic
findings (e.g., abdominal aortic aneurysms) are consid-
ered, the cost-effectiveness of CTC increases further rel-
ative to OC [59]. Equivalence of clinical efficacy for
colorectal evaluation between CTC and OC is well
established [49, 60, 61].
Separate modeling is required for non-Medicare popu-
lations. Commercial insurance, Medicaid, other insurer,
and direct-bill costs are substantially different and often
higher than Medicare costs with inconsistent cost differen-
tials by service. In particular, commercial insurers generally
pay much higher fees for anesthesia and OC than does
Medicare. Future changes in Medicare fee schedules and
payment methodologies, Medicare assigning a screening
CTC fee schedule payment different than the current
diagnostic CTC fee schedule, or changes in OC or CTC
screening guidelines and practices may increase or decrease
the cost advantage of CTC over OC.
Acknowledgments Milliman was commissioned by the National Elec-
trical Manufacturers Association to produce this study.
Conflict of interest Dr. Pickhardt is co-founder of VirtuoCTC and
shareholder in Cellectar Biosciences.
Ethical Standards The study used the Medicare 5% and 100% Sample
claims and enrollment data and publicly available data and did not
involve patient contact. The Medicare samples were used in compliance
with the privacy terms of Milliman’s data use agreements with the
Centers of Medicare and Medicaid Services (CMS).
Open Access This article is distributed under the terms of the Creative
Commons Attribution 4.0 International License (http://creativecommons.
org/licenses/by/4.0/), which permits unrestricted use, distribution, and re-
production in any medium, provided you give appropriate credit to the
original author(s) and the source, provide a link to the Creative Commons
license, and indicate if changes were made.
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