A Multistate Analysis of Prosthetic and Orthotic Coverage Clarification: Projected Positive Return on Investment and Net Fiscal Benefit.

BACKGROUND

Orthotic and prosthetic devices for general-use and activity-specific function can provide critical preventive health benefits for individuals with limb loss, limb difference, and mobility impairments, and yet coverage remains inconsistent across U.S. states.

OBJECTIVE

To evaluate the fiscal impact of clarifying insurance coverage for orthotic and prosthetic devices across 23 states lacking comprehensive coverage.

METHODS

A cost consequence analysis was conducted using data from the U.S. Census Bureau, Kaiser Family Foundation, Government Accountability Office, and a recent actuarial analysis informing baseline cost, coverage, and prevalence assumptions. Per-member-per-month (PMPM) cost increases were compared against device enabled preventive health savings to estimate net fiscal impact. Sensitivity analyses modeled three scenarios based upon a combination of uptake (% eligible individuals accessing device) and physical activity equivalent annual cost saving, respectively: conservative (25% uptake, $1000), moderate (50% uptake, $2500), and high-impact (75% uptake, $5000). Return on investment (ROI) was calculated for the moderate scenario as the ratio of annual savings to implementation cost.

RESULTS

Under the assumptions of the moderate scenario, projected ROI remained positive across all states, ranging from approximately 1.5× in Florida to over 114× in Vermont, with 78% of states (18 of 23 states) demonstrating returns greater than 4×. Moderate scenario annual net savings ranged from approximately $10.8 million in Vermont to $437.0 million in California, with substantial projected savings also observed in Florida ($235.5 million), New York ($225.2 million), and Virginia ($143.8 million). PMPM cost increases for 70% of states range between $0.03 and $0.43, with all modeled states remaining below $1.46.

DISCUSSION: In our healthcare system dominated by high-cost and reactive care, the ROI obtained by this cost-consequence analysis (CCA) using evidence-based assumptions supports orthotic and prosthetic coverage clarification as preventive interventions to restore function.