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Costs and Economics of Skin Cancer Management, Mohs Surgery, and Surgical Reconstruction

Kantor, Jonathan, MD, MSCE, MA*†

Plastic and Reconstructive Surgery – Global Open: June 2017 - Volume 5 - Issue 6 - p e1380
doi: 10.1097/GOX.0000000000001380
Letter to the Editor
United States

From the *Department of Dermatology, Perelman School of Medicine at the University of Pennsylvania, Philadelphia, Pa.; and Florida Center for Dermatology, P.A. Saint Augustine, Fla.

Disclosure: The author has no financial interest to declare in relation to the content of this article. The Article Processing Charge was paid for by the author.

Jonathan Kantor, MD, MSCE, MA, Florida Center for Dermatology, P.A., PO Box 3044, Saint Augustine, FL 32085, E-mail:

This is an open-access article distributed under the terms of the Creative Commons Attribution-Non Commercial-No Derivatives License 4.0 (CCBY-NC-ND), where it is permissible to download and share the work provided it is properly cited. The work cannot be changed in any way or used commercially without permission from the journal.

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I read with great interest the well-written and thoughtful article by Chen et al.1 Several important caveats should be addressed to better understand the surgical treatment options available for nonmelanoma skin cancer (NMSC).

First, the authors refer to a statistic that Mohs micrographic surgery (MMS) utilization increased by 700% between 1992 and 2009. The source of this number remains obscure. One opinion piece in the dermatology literature mentions this statistic,2 though the article cited as this number’s source does not include this calculation.3 Although a 7-fold increase in utilization of MMS would not in itself be problematic over this time period (MMS training only became widespread in the early 1980s and the incidence of NMSC skyrocketed), the accuracy of this statistic remains unclear.

Second, when considering the global cost of NMSC care, it is important to recall that a significant proportion (up to 30%, based on some studies)4 of MMS cases are allowed to heal by secondary intention, whereas excisions are almost always closed primarily. The significant cost of posttumor extirpation repair, which may be several times the excision cost, was not addressed by the authors.

Third, the authors do not account for the impact of the multiple procedure reduction rule on cost. Medicare and almost every private insurer reduces payment for the secondary (less expensive) procedure by 50%; because MMS bundles the cost of the excision and pathology together, it is (unless a flap or graft is used) more costly than the repair, and thus repair reimbursements associated with MMS are halved. In contrast, repairs after excisions are usually reimbursed at 100%, and the (more modest) excision reimbursement is halved. Importantly, pathology fees are reimbursed at 100% when MMS is not used. These changes together have a net negative effect on the cost of MMS care.

Fourth, the authors cite 2 studies5,6 regarding recurrence rates and suggest that recurrence rates after MMS and excision are “the same.” In fact, these studies found that post-MMS recurrence rates are lower (the authors swapped the percentages of the first study in their article and the numbers for the second do not match the cited article), though not statistically significantly so. It is not clear, moreover, whether these studies were sufficiently powered to detect a significant difference in recurrence rates. Both of the cited studies were controversial and had significant methodological shortcomings, including generalizability, bias, and confounding.7–11 Most importantly, the first study was a trial where MMS was not compared with a single excision but rather to a set of serial excisions performed to obtain clear margins, whereas the latter was a cohort study in which patients were not randomized at all. A large meta-analysis of available studies suggested that the recurrence rate for primary basal cell carcinoma, for example, is 10.1%, more than 5 times the recurrence rate seen with MMS in the studies cited by the authors.12

Fifth, the authors note that on average “1 in 4 cases of skin cancer is treated with MMS.” If correct, this points to a dramatic underutilization of MMS in the United States because based on the Appropriate Use Criteria 1 academic center suggested that 72% of tumors would be MMS eligible.13 Although surgeons should be responsible stewards of the healthcare system, it is not clear whether self-imposed rationing is desirable or indeed ethical.14

Sixth, the authors refer to “margins” as a measure of the size of the excised tumors; these numbers, based on current procedural terminology coding, are based on total lesion size including margins, not simply the margins around the tumor. This is important because the majority (as noted in the authors’ Table 1) of malignancies are removed with a total size between 1.1 and 3.0 cm, meaning that the low-end estimate for excision costs cited by the authors is rarely used, thus underestimating the cost of excision because MMS is not billed based on lesion size.

Seventh, the authors cite what seems to be a low estimate for the pathology cost associated with excisions; the national Medicare payment amount for current procedural terminology code 88305 in 2012 was $105.86, not $68.37 as cited by the authors. These costs increase further if special stains or frozen sections are performed as well,4,15 again biasing the authors’ results in favor of excision rather than MMS.

Eighth, the authors’ Figure 5 assumes that all MMS cases require 2 stages for clearance, whereas the published literature suggests that the majority of MMS defects are closed after a single stage.3 This again biases the results in favor of excision over MMS.

Finally, the authors cite “internal data” suggesting that the “cost of MMS can be more than 2 to 3 times” the cost of excision, though extensive published data on this question are available that suggest a much smaller marginal cost difference between MMS and office-based excision, on the order of a 20–30% increase in cost, rather than a 200–300% increase, when pathology and repair costs are considered.4,16 Importantly, other studies have concluded that surgery center or hospital-based excision with frozen sections are significantly more costly than office-based MMS.4,17–19

Given the significant burden of NMSC management on the healthcare system, it is critical to carefully evaluate the extant literature. The authors should be commended for highlighting important lacunae in the medical literature regarding recurrence rates and costs for NMSC, which will hopefully spur much needed further research in this area.

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1. Chen JT, Kempton SJ, Rao VK. The economics of skin cancer: an analysis of Medicare payment data. Plast Reconstr Surg Glob Open. 2016;4:e868.
2. Stern RS. Cost effectiveness of Mohs micrographic surgery. J Invest Dermatol. 2013;133:1129–1131.
3. Donaldson MR, Coldiron BM. Mohs micrographic surgery utilization in the Medicare population, 2009. Dermatol Surg. 2012;38:1427–1434.
4. Cook J, Zitelli JA. Mohs micrographic surgery: a cost analysis. J Am Acad Dermatol. 1998;39:698–703.
5. Mosterd K, Krekels GA, Nieman FH, et al. Surgical excision versus Mohs’ micrographic surgery for primary and recurrent basal-cell carcinoma of the face: a prospective randomised controlled trial with 5-years’ follow-up. Lancet Oncol. 2008;9:1149–1156.
6. Chren MM, Torres JS, Stuart SE, et al. Recurrence after treatment of nonmelanoma skin cancer: a prospective cohort study. Arch Dermatol. 2011;147:540–546.
7. Feldman S, Pearce DJ, Williford PM. Surgical decision making for basal-cell carcinoma of the face. Lancet Oncol. 2008;9:1119–1120.
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11. Robinson JK. Evidence-based choice of treatment of NMSC. Arch Dermatol. 2011;147:546.
12. Rowe DE, Carroll RJ, Day CL Jr.. Long-term recurrence rates in previously untreated (primary) basal cell carcinoma: implications for patient follow-up. J Dermatol Surg Oncol. 1989;15:315–328.
13. Blechman AB, Patterson JW, Russell MA. Application of Mohs micrographic surgery appropriate-use criteria to skin cancers at a university health system. J Am Acad Dermatol. 2014;71:29–35.
14. Kantor J. Mohs micrographic surgery utilization in the United States based on Medicare data. JAMA Dermatol. 2017 May 10. doi: 10.1001/jamadermatol.2017.0732. [Epub ahead of print]
15. Cataldo PA, Stoddard PB, Reed WP. Use of frozen section analysis in the treatment of basal cell carcinoma. Am J Surg. 1990;159:561–563.
16. Seidler AM, Bramlette TB, Washington CV, et al. Mohs versus traditional surgical excision for facial and auricular nonmelanoma skin cancer: an analysis of cost-effectiveness. Dermatol Surg. 2009;35:1776–1787.
17. Kauvar AN, Arpey CJ, Hruza G, et al. Consensus for nonmelanoma skin cancer treatment, part II: squamous cell carcinoma, including a cost analysis of treatment methods. Dermatol Surg. 2015;41:1214–1240.
18. Kauvar AN, Cronin T Jr, Roenigk R, et al. American Society for Dermatologic Surgery. Consensus for nonmelanoma skin cancer treatment: basal cell carcinoma, including a cost analysis of treatment methods. Dermatol Surg. 2015;41:550–571.
19. Tierney EP, Hanke CW. Cost effectiveness of Mohs micrographic surgery: review of the literature. J Drugs Dermatol. 2009;8:914–922.
Copyright © 2017 The Author. Published by Wolters Kluwer Health, Inc. on behalf of The American Society of Plastic Surgeons.