(016) National Trends in Medicare Reimbursement, Market Concentration, and Geographic Variation for Tracheostomy, 2013-2023

Introduction: This study seeks to characterize national trends in Medicare reimbursement, geographic variation, provider distribution, and economic alignment for tracheostomy from 2013 to 2023.

Methods: This retrospective longitudinal database analysis queried the Medicare Provider Utilization and Payment Data for tracheostomy-related CPT codes from 2013–2023. Weighted mean Medicare payments were inflation-adjusted to 2023 USD using the Consumer Price Index. Geographic variation was assessed using the coefficient of variation (CV), and reimbursement patterns were stratified by rural–suburban–urban classification. Provider volume distributions were analyzed longitudinally, including identification of high-volume outliers. State-level reimbursement was linked to cost-of-living indices, with economic alignment evaluated using Spearman correlations. Pre- and post–COVID-19 trends were examined using segmented analyses.

Results: Mean tracheostomy reimbursement declined substantially, decreasing from approximately $385 in 2013 to $222 in 2023 (2023 USD), with an inflection after 2017 and no post–COVID-19 recovery. Geographic reimbursement variability increased significantly over time (CV slope = 0.0056/year, p = 0.007), peaking after 2021. No significant differences in mean payment were observed between urban and rural providers (p = 0.95), despite differences in service volume. Provider volume demonstrated a persistent right-skewed distribution with high-volume outliers; mean volume peaked in 2020 and declined thereafter. Correlation between state-level reimbursement and cost of living was modest and inconsistent (ρ ≈ 0.25–0.45), with weak alignment in 2023 (ρ ≈ 0.42).

Conclusions: Medicare reimbursement for tracheostomy has declined while geographic payment variability has increased. Persistent misalignment with the cost of living and lack of urban–rural differentiation highlight structural rigidity in reimbursement policy, suggesting inadequate responsiveness to regional economic pressures.