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Abstract

Background:

Examining the markup ratio (MR), which is the ratio of health care institutions submitted charges to Medicare payments, is essential for informing policies on price transparency and health care affordability in the setting of declining reimbursement for orthopaedic procedures. While MRs have been extensively studied in both arthroplasty surgery and other specialties, revealing their high variability, there is limited research on MRs for orthopaedic sports procedures and the potential for “surprise billing” among patients undergoing these services.

Purpose/Hypothesis:

This study aimed to (1) quantify MRs for the 15 highest-volume orthopaedic sports procedures and (2) assess longitudinal trends from 2014 to 2021. It was hypothesized that the submitted charges and Medicare reimbursements for these procedures would reveal persistently high MRs.

Study Design:

Cross-sectional study.

Methods:

This review evaluated the top 15 Healthcare Common Procedure Coding System (HCPCS) codes related to orthopaedic sports medicine in December 2023. The mean and median MRs for each Current Procedural Terminology procedure were analyzed at the national, regional, and sex levels over the study period. Descriptive statistics—including median, interquartile range, mean, and standard deviation—were calculated for the included MRs at the national, state, and HCPCS-code levels. Mann-Kendall trend tests were used to analyze the trend of MRs from 2014 to 2021.

Results:

The included orthopaedic sports procedures had a median MR between 5.81 and 6.30, revealing no significant changes from 2014 to 2021. Two types of primary procedures had MRs of >10, including shoulder arthroscopy with extensive debridement (16.79) and patellar tendon repair (13.66). No significant sex differences were observed for the median MR among men (P = .081) and women (P = .266).

Conclusion:

Our review revealed that orthopaedic sports procedures consistently had high MRs; however, no significant changes were found in MR trends from 2014 to 2021. Our findings suggest that while inflation-adjusted Medicare reimbursement has declined, MRs have remained stable.

Keywords

Centers for Medicare and Medicaid Services markup ratios price transparency sports medicine

Orthopaedic sports medicine procedures vary in price depending on the patient’s insurance status, which may result in an out-of-pocket financial burden for the patient.^4,11 The Centers for Medicare & Medicaid Services (CMS) set national prices for allowed services for Medicare patients, who make up at least 14.6% of the United States (US) population.^8,9 The price refers to the amount that the CMS agrees upon to pay the physician or the hospital for a given service, which may be different from the price negotiated by commercial insurers.²⁷ For the non-Medicare population, including patients who are uninsured or underinsured, or those receiving out-of-network care, a chargemaster established by individual hospitals determines the set prices, which can vary because of the number of contracts with insurance plans or regions, among several other factors.^4,5,11,30,33 These prices are often higher than Medicare-allowed amounts and vary considerably between institutions, resulting in surprise billing that is charged to patients, causing significant and unexpected financial burden.^7,9-11 While the cost of a service is the actual expense incurred by the physician for the service, the submitted charge is the amount billed by the physician to the payer.¹²

Many studies in the literature have analyzed the increased charges in health care bills for services compared with Medicare-allowed prices for a variety of orthopaedic and non-orthopaedic services—including otolaryngology, emergency medicine, anesthesiology, head and neck surgery, and lung cancer resections.^{2,12,14,17,20,22} These markups in billed charges were not lower in states with surprise billing protection laws, indicating the significant financial burden despite measures that have tried to reduce them.¹⁴ Previous literature has also characterized the markup ratios (MRs), defined as the ratio of all charges submitted for a service and the Medicare reimbursement, for total hip and total knee arthroplasty procedures.¹⁶ However, there is no current literature for MRs specifically for orthopaedic sports procedures.

Several studies have shown a reduction in reimbursement for orthopaedic sports procedures in recent years, despite increased operative times and complexity of cases.^13,18 Still, no literature outlines the MR trends within orthopaedic sports medicine. The purpose of this study was to outline the MRs for the 15 highest volume orthopaedic sports procedures from 2014 to 2021, and to correlate these trends to recent data regarding reimbursement trends over this same period. We hypothesized that MRs within sports medicine would increase, reflecting increased submitted charges relative to decreased Medicare reimbursement.

Methods

Data Source

A retrospective review of services provided by orthopaedic sports surgeons from 2014 to 2021 was performed using the Medicare Physician and Other Practitioners dataset prepared by the CMS on December 25, 2023. This dataset includes information on procedures performed for Medicare Part B beneficiaries by physicians and other health care professionals. It discloses Medicare payments based on filed claims, along with volume, submitted charges, and other details categorized by Level 1 and Level 2 Healthcare Common Procedure Coding System (HCPCS) codes. The HCPCS does not define codes relevant to sports medicine. The codes included in this study were identified based on previous literature examining the most common orthopaedic sports medicine procedures.^6,23,44 This review included only codes missing no more than 1 year of data; 15 codes met this criterion.

Data Collection

Surgeons classified under “Sports Medicine,”“Orthopaedic Surgery,” or “Hand Surgery” were identified from the Physician & Other Practitioners database. These search terms were utilized in a previous analysis to capture all orthopaedic surgeons within this specific database.¹² Surgeons practicing outside the US were excluded. The location and sex of each orthopaedic sports surgeon were recorded. We examined service counts by HCPCS codes, submitted charges, and Medicare actual payments for each included year.

Statistical Analysis

Descriptive statistics—including median, interquartile range (IQR), mean, and standard deviation —were calculated for the included cost-to-charge ratios at the national, state, and HCPCS-code levels. Mann-Kendall trend tests were used to analyze the trend of MRs from 2014 to 2021. A heatmap was utilized to assess the geographic distribution of MRs. P < .05 was considered significant.

Ethical Approval

This study analyzed publicly available CMS data and therefore did not require Institutional Review Board approval.

Results

Included Procedures

Our review evaluated the top 15 HCPCS codes related to orthopaedic sports medicine, comprising 14 primary procedures and 1 ZZZ add-on code (shoulder arthroscopy with subacromial decompression) that cannot be billed independently (Table 1). This included a mean of 196,322 procedures per year, provided by a mean of 4170 orthopaedic surgeons (Table 2). The total number of procedures (182,832 to 176,308 [–3.6%]; P = .902) did not significantly decrease over the study period. The median MRs, as well as the mean and standard deviation, did not change significantly for all procedures. Among all surgeons, the overall median MR (IQR, coefficient of variation [CoV]) was 9.57 (3.96-11.87, 0.98) for sports medicine procedures, demonstrating at least 800% excess charge.

Table 1

Included HCPCS Codes Related to Sports Medicine ^a

HCPCS Code	Description
23430	Tenodesis of the long tendon of the biceps
23472	Total shoulder arthroplasty
27380	Patellar tendon repair
27385	Repair of the quadriceps
27654	Repair of the Achilles tendon, secondary, with or without graft
29806	Shoulder arthroscopy, capsulorrhaphy
29807	Shoulder arthroscopy, repair of SLAP lesion
29823	Shoulder arthroscopy, extensive debridement
29826	Subacromial decompression
29827	Shoulder arthroscopy, rotator cuff repair
29862	Hip arthroscopy, chondroplasty with labral resection
29877	Knee arthroscopy, chondroplasty
29880	Knee arthroscopy, medial and lateral meniscectomy with chondroplasty
29881	Knee arthroscopy, medial or lateral meniscectomy with chondroplasty
29882	Knee arthroscopy, medial or lateral meniscus repair

HCPCS, Healthcare Common Procedure Coding System; SLAP, superior labrum anterior to posterior.

Table 2

Summary of Included Sports Medicine Procedures and MRs Between 2014 and 2021 ^a

	2014	2015	2016	2017	2018	2019	2020	2021	P
Unique codes	15	15	14	15	15	15	15	15
Total services	182832	188730	200384	213106	218714	218093	172409	176308	.902
MR
Median	6.30	6.15	6.18	6.35	6.29	6.04	5.87	5.81	.063
IQR	4.07-12.26	4.01-11.89	4.03-11.76	4.03-12.27	4.01-12.26	3.90-11.54	3.82-11.40	3.84-11.66
Mean ± SD	9.64 ± 8.74	9.52 ± 8.93	9.51± 8.84	9.94 ± 10.22	9.87 ± 9.91	9.40 ± 9.46	9.12 ± 8.73	9.52 ± 9.61	.319
CoV	0.91	0.94	0.93	1.03	1	1.01	0.96	1.01	.135
No. of physicians	4280	4408	4440	4372	4374	4293	3541	3654	.174
Men	4184	4313	4343	4272	4265	4188	3458	3552	.108
Women	96	95	97	100	109	105	83	102	.386

CoV, coefficient of variation; HCPCS, Healthcare Common Procedure Coding System; IQR, interquartile range; MRs, markup ratios.

Upper Extremity

Median (IQR) MRs in 2021 for sports medicine procedures of the upper extremity ranged from 3.98 (3.28-5.40; shoulder arthroscopy, rotator cuff repair) to 16.79 (11.50-24.25; shoulder arthroscopy, extensive debridement). The median compound annual growth rate ranged from −2.52% (HCPCS: 29826; subacromial decompression) to 4.21% (HCPCS: 29823; shoulder arthroscopy, extensive debridement). A significant increase in median MR was observed for HCPCS code 29823 (shoulder arthroscopy, extensive debridement) from 2014 to 2021 (P = .046). Conversely, a significant decrease in median MR was noted for HCPCS code 29826 (subacromial decompression) over the study period (P = .002). No significant trends in MR were observed for the remaining upper extremity sports medicine procedures (Table 3).

Table 3

Characteristics of MRs for Sports Medicine Procedures by HCPCS Code ^a

Procedure 2021		Median ($) 2021		MR 2021					Median MR (2014-2020)							Trend
HCPCS Code	Total Service Number	Submitted Charges	Allowed Payments	Mean	SD	Median	IQR	CoV	2014	2015	2016	2017	2018	2019	2020	P
23430	9625	2281.92	396.36	8.41	4.66	7.26	5.84-9.37	0.55	7.19	7.30	7.26	7.54	7.38	7.27	7.45	.618
23472	47511	4829.67	1438.28	5.11	3.92	4.18	3.44-5.62	0.77	4.33	4.38	4.34	4.31	4.38	4.23	4.15	.081
27380	26	1695.50	215.51	13.66	7.13	13.66	11.14-16.18	0.52	9.60	13.80	14.24	13.86	12.07	10.47	9.16	.536
27385	66	2092.30	316.71	7.48	1.84	6.70	6.57-7.61	0.25	6.29	6.68	7.30	9.69	7.96	8.04	9.37	.174
27654	67	2102.00	554.73	5.37	0.65	5.77	4.68-5.78	0.12	4.41	4.99	3.82	5.04	7.92	4.74	8.11	.108
29806	92	3579.00	912.21	7.37	6.00	5.77	2.75-10.39	0.81	4.37	3.87	3.64	3.66	2.92	4.89	5.76	.266
29807	346	3394.18	624.65	7.17	3.42	6.66	5.37-8.27	0.48	5.01	5.26	5.67	6.75	5.48	7.12	5.65	.108
29823	19691	2175.00	156.88	19.97	13.22	16.79	11.50-24.25	0.66	12.07	12.07	12.47	14.23	14.11	13.76	13.78	.046
29826	40757	1500.00	172.76	14.50	10.93	11.99	6.05-20.19	0.75	14.70	14.27	13.84	13.43	13.31	12.26	11.71	.002
29827	36992	3298.91	1062.38	4.74	3.16	3.98	3.28-5.40	0.67	4.06	4.06	4.06	4.08	4.10	4.04	3.89	.308
29862	64	2036.11	796.51	3.44	0.43	3.42	3.10-3.76	0.12	4.32	4.25	4.55	6.12	4.00	3.80	4.07	.108
29877	137	2298.55	631.28	6.82	4.30	4.65	4.33-7.26	0.63	3.77	4.53	3.77	3.64	4.86	4.30	4.30	.379
29880	9461	2314.00	539.28	7.98	6.22	5.96	4.23-9.58	0.78	7.21	6.9	6.89	7.12	6.43	6.26	5.93	.009
29881	11363	2040.00	514.44	7.72	9.07	5.46	4.01-8.32	1.17	6.00	6.11	6.01	5.91	5.98	5.68	5.70	.019
29882	42	4635.00	764.90	7.89	3.20	7.87	6.29-9.48	0.41	4.32	3.19	-	4.03	4.13	4.02	3.11	.902

The codes are listed in ascending rank order. CoV, coefficient of variation; HCPCS, Healthcare Common Procedure Coding System; IQR, interquartile range; MR, markup ratio.

Lower Extremity

Median (IQR) MRs in 2021 for sports medicine procedures of the lower extremity ranged from 3.42 (3.10-3.76; hip arthroscopy, chondroplasty with labral resection) to 13.66 (11.14-16.18; patellar tendon repair). The median compound annual growth rate ranged from −2.88% (HCPCS: 29862; hip arthroscopy, chondroplasty with labral resection) to 7.79% (HCPCS: 29882; knee arthroscopy, medial or lateral meniscus repair). A significant decrease in median MR was noted for HCPCS 29880 (knee arthroscopy, medial and lateral meniscal repair with chondroplasty; P = .009) and HCPCS 29881 (knee arthroscopy, medial or lateral meniscus repair with chondroplasty; P = .019) over the study period from 2014 to 2021. No significant trends in MR were observed for the remaining lower extremity sports medicine procedures (Table 3).

Geographic Analysis

Figure 1 (A and B) shows the median MRs by state for all sports medicine procedures included in this study in 2014 and 2021. New Jersey had the highest median MR (12.70) in 2021, followed by Wisconsin (12.50), Alaska (10.21), Wyoming (10.05), Illinois (9.69), New Hampshire (9.34), Nevada (9.29), Massachusetts (9.09), and Delaware (9.02). The lowest median MRs by state were Hawaii (2.66), Washington (3.75), Maine (3.77), Montana (3.92), West Virginia (3.95), and North Dakota (3.98). The remaining states had median MRs ranging from 4 to 9.

Figure 1.

(A) Map of the 2014 median MR by state for sports medicine procedures. (B) Map of the 2021 median MR by state for sports medicine procedures. MR, markup ratio.

Sex Analysis

No significant sex differences were observed for median MR among men (P = .081) and women (P = .266) who underwent the included sports medicine procedures (Table 4).

Table 4

Trends in MRs for Sports Medicine Procedures by Sex From 2014 to 2021 ^a

	2014	2015	2016	2017	2018	2019	2020	2021	P
Men
Median MR	6.31	6.15	6.18	6.37	6.31	6.04	5.88	5.83	.081
IQR	4.08-12.27	4.02-11.88	4.03-11.77	4.04-12.28	4.02-12.26	3.90-11.51	3.82-11.40	3.85-11.68
CoV	1.39	1.45	1.43	1.61	1.57	1.57	1.49	1.65	.081
No.	4184	4313	4343	4272	4265	4188	3458	3552	.108
Women
Median MR	5.71	6.19	6.27	5.51	5.63	5.88	5.70	5.44	.266
IQR	3.70-11.62	3.73-11.96	3.74-11.12	3.70-11.82	3.85-11.45	3.84-12.17	3.75-11.87	3.77-10.65
CoV	1.43	1.39	1.16	1.23	1.88	1.32	1.37	1.50	.711
No.	96	95	97	100	109	105	83	102	.386

CoV, coefficient of variation; HCPCS, Healthcare Common Procedure Coding System; IQR, interquartile range; MR, markup ratio.

Discussion

The significant findings of our analysis demonstrated that the median MR for sports medicine procedures included in our analysis was around 5.81 to 6.35 across all procedures from 2014 to 2021. These differences did not show any significant variation year over year. The procedures with the highest MRs included shoulder arthroscopy, extensive debridement (Current Procedural Terminology [CPT] 29823, median MR 16.79), patellar tendon repair (CPT 27380, median MR 13.66), and shoulder arthroscopy with subacromial decompression (CPT 29826, median MR 11.99). Within orthopaedics, the median MR for sports medicine procedures exceeds the MRs seen in adult reconstruction, which ranged⁴⁰ around 4 to 5 for both total hip and total knee arthroplasty from 2013 to 2019. The highest MR reported within arthroplasty was for revision of the total hip femoral component, with an MR of 6.1.

Medicare reimbursements have been decreasing for both orthopaedic and nonorthopaedic procedures.^{12,32,38,41,47,48} Within orthopaedic surgery itself, the decrease in inflation-adjusted Medicare reimbursement has not impacted each subspecialty to the same degree. Within arthroplasty, the highest MR procedures of revision arthroplasty (MRs 5.24-6.10) saw a decrease in inflation-adjusted Medicare reimbursement between¹ 18% to 28%. Within sports, the mean reduction in reimbursement for shoulder/elbow and knee procedures was cited at 34% and 31%, respectively.³⁵ Of the CPT codes directly included in this study, the inflation-adjusted Medicare reimbursement decrease ranged³⁵ from −26% to −84%. The CPT code 29862, the lowest median MR within this study of 3.44, had the lowest decrease in inflation-adjusted Medicare reimbursement (–26%). The CPT code 29826, one of the highest median MRs at 11.99, saw the most significant decrease in inflation-adjusted Medicare reimbursement across all sport procedures (–84%). Elkousy et al²¹ demonstrated a substantial decrease in Medicare reimbursement for this procedure after it became an add-on code in 2012. CPT codes 29823 and 27380 were not included in the study by Pollock et al,³⁵ and could not be assessed. The decreased Medicare allowed payments in the present study could be attributed to the Multiple Procedure Payment Reduction policy, as denoted in the Physician Fee Schedule Look-Up Tool.³⁴ As previously noted, the decrease in reimbursement rates for sports medicine procedures is substantial, and high MR procedures are correlated with the degree of decrease in reimbursement. Decreased reimbursements notably occur in the same setting of increasing complexity and length of surgery, increasing inflation-adjusted hospital episode of care costs, increased implant costs, and a >20% increase in uncompensated perioperative workload.^{9,14,20,24,28,31,35,42,44} Over the same period, inflation-adjusted physician pay has decreased from 0.5% to 5% per year.^7,31 Given the combination of increasing cost with decreasing pay, the MRs reported here are not surprising. The MR trends do not reflect physician pay, which has declined year over year.³¹

While MR trends can help recover lost costs, they may have a significant impact on out-of-network, uninsured, and underinsured patient populations. These patient populations are often required to pay out-of-pocket to cover some degree of the procedure.^{4,16,19,36–38} Xu et al⁴⁸ demonstrated how higher MRs seemed to affect hospitals caring for a greater percentage of uninsured patients. While a policy like the California Hospital Fair Pricing Act may help reduce the financial burden for uninsured patients, the effect of this state-level policy is limited, and further investigation is needed to better understand potential variation in internal policies of discounts for those who are uninsured.³ Bai and Anderson⁴ showed how hospitals adjust the chargemaster price to enhance revenue. Thus, it is possible that submitting increased charges to increase reimbursement for unfunded patients may contribute to patient anxiety in surprise billing.¹² Approximately 1 in 6 patients undergoing elective orthopaedic surgery end up receiving a surprise bill.¹⁸ With anterior cruciate ligament reconstruction, for example, out-of-pocket costs to insured patients increased 36% from $1085 in 2013 to $1480 in 2017, coinciding with a 4.3% decrease in reimbursement over this period.¹³ While the Affordable Care Act has overall reduced the number of uninsured and underinsured patients, significant disparities still exist among racial and demographic lines, notably affecting American islander patients, Hispanic patients, and Black patients.²⁶ Because of the resulting financial burden, patients ultimately delay or avoid medical treatment.^2,45

Governmental and hospital bodies have taken steps to mitigate this issue, as seen with the No Surprises Act; however, these downstream interventions are insufficient to mitigate the issue at hand.²⁹ Unfortunately, these MR trends negatively affect uninsured and underinsured patients unequally.^13,19 Hospital bodies must coordinate to accurately account for the cost of patient care and to determine a suitable reimbursement.^22,44,46

Limitations

The results of our analysis must be interpreted within the limitations of this study. First and foremost, the markup on orthopaedic procedures is often determined at the institutional level, rather than by the individual surgeons submitting the HCPCS codes provided by the analyzed database. Another limitation is that this database does not provide us with specific details that may affect MRs, and thus, we are unable to control for certain confounding variables. Variables such as implant supply and demand for each institution, as well as patient-specific details— including comorbidities, the complexity of surgery, and the number of implants or grafts—are used. Given that there is evidence that certain CPT codes—such as 29806, 29807, 29877, 29880, 29881, 29882, and 29862—are rarely indicated for older patient populations, it is essential to note that these charges in the Medicare population may be overstated.^15,25,39,43 In addition, because this database is strictly limited to the billing provided by the individual orthopaedic surgeon, there may be hospital-specific fees or other costs related to the patient's episode of care that we are unable to account for. This dataset did not denote whether the procedure address corresponded to a surgery center or hospital, which may also affect MRs. Considering the lack of granular details provided by the database, we may be underestimating the total cost burden on the patient or the strain on health care. Limitations also arise, considering that private insurers are not included in this database, which only provides Medicare claims data. Finally, with any database that relies on coding, there is a low, but theoretical, risk of coding errors leading to misrepresentation of the results. Despite these limitations, our study represents the first analysis of the trends in median MR as they relate to orthopaedic sports medicine services.

Conclusion

Our review demonstrated that orthopaedic sports procedures had persistently high MRs, but no significant changes in MR trends from 2014 to 2021. Our findings suggest that while inflation-adjusted Medicare reimbursement has declined, MRs have remained stable. These ratios may reflect a response to recover income in the setting of increasing hospital costs and decreased reimbursement.

Footnotes

Final revision submitted April 14, 2025; accepted June 26, 2025.

One or more of the authors has declared the following potential conflict of interest or source of funding: M.J.S. is a paid consultant for Stryker. J.E.V. is a paid consultant for Arthrex. J.G.C. is a paid consultant for Smith & Nephew. AOSSM checks author disclosures against the Open Payments Database (OPD). AOSSM has not conducted an independent investigation on the OPD and disclaims any liability or responsibility relating thereto.

Ethical approval was not sought for the present study.

ORCID iDs

Victoria J. Nedder

Jacob G. Calcei

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Contemporary Markup Trends in Orthopaedic Sports Procedures: An Analysis of 2014-2021 Medicare Data

Abstract

Background:

Purpose/Hypothesis:

Study Design:

Methods:

Results:

Conclusion:

Keywords

Methods

Data Source

Data Collection

Statistical Analysis

Ethical Approval

Results

Included Procedures

Upper Extremity

Lower Extremity

Geographic Analysis

Sex Analysis

Discussion

Limitations

Conclusion

Footnotes

ORCID iDs

References

Supplementary Material