This document introduces the Macon Value Formula, which provides a quantitative method to compare the value of different spine procedures based on outcomes and costs. The formula calculates a relative value score from 0-1000 based on outcomes achieved (measured on a 0-100 scale), costs, and whether the outcome was a success or failure. The document provides an example application comparing lumbar epidural steroid injections and lumbar discectomy. It finds that lumbar discectomy provided higher value at 12 months based on 100% success rate and lower total costs compared to epidural steroid injections. The goal of using this formula is to maximize value, effectiveness and success of procedures by comparing and optimizing treatment sequences.

1. A Relative Value Calculator ForA Relative Value Calculator For
Pain ProceduresPain Procedures
James B. Macon, M.D.James B. Macon, M.D.
Framingham NeuroSpineFramingham NeuroSpine
Framingham, MassachusettsFramingham, Massachusetts
Copyright 2010 James B. Macon, M.D.Copyright 2010 James B. Macon, M.D.

2. DisclosureDisclosure
James B. Macon, M.D. is a consultant forJames B. Macon, M.D. is a consultant for
Spine Surgical Innovations, Inc.Spine Surgical Innovations, Inc.

3. Value DefinitionValue Definition
Value for patientsValue for patients ==
Health Outcomes perHealth Outcomes per
$ Cost Expended$ Cost Expended
Porter, M.E. “A Strategy for Health CarePorter, M.E. “A Strategy for Health Care
Reform – Toward a Value-Based System”Reform – Toward a Value-Based System”
NEJMNEJM 361: 109-112, 2009361: 109-112, 2009

5. Value =Value = Successful OutcomesSuccessful Outcomes
Provider PaymentsProvider Payments

6. Outcome TiersOutcome Tiers
 Tier I :Tier I : primary outcomeprimary outcome (pain, neuro status,(pain, neuro status,
return to work, disability status)return to work, disability status)
 Tier II :Tier II : complicationscomplications (infections, root injury,(infections, root injury,
CSF leak, delay to recovery)CSF leak, delay to recovery)
 Tier III :Tier III : recurrencesrecurrences ( re-herniation, re-op,( re-herniation, re-op,
delayed adverse events- scarring)delayed adverse events- scarring)
Convert all outcomes to % recovery to baselineConvert all outcomes to % recovery to baseline

7. MaconMacon Value FormulaValue Formula
A Quantitative Value Analysis FormulaA Quantitative Value Analysis Formula
for Comparison of Spine Interventionsfor Comparison of Spine Interventions
Based on Outcome and Cost DataBased on Outcome and Cost Data

8. Formula VariablesFormula Variables
 OOkk is the outcome for individual k (0-100)is the outcome for individual k (0-100)
 n is the number in the intervention groupn is the number in the intervention group
 s is 1 if outcome success and 0 if failures is 1 if outcome success and 0 if failure
 DDkk is the total provider payment (min. $100)is the total provider payment (min. $100)
 c is 1 for additional cost and 0 if no costc is 1 for additional cost and 0 if no cost
 V is the relative value calculated (0-1000)V is the relative value calculated (0-1000)

9. Formula StepsFormula Steps
 Identify condition ICD9 codes (722.10/724.3) <4 wksIdentify condition ICD9 codes (722.10/724.3) <4 wks
 Identify intervention groups CPT code (62311/63030)Identify intervention groups CPT code (62311/63030)
 Define group size n to be studied (10)Define group size n to be studied (10)
 Define severity rating for the condition (8-10/10 pain)Define severity rating for the condition (8-10/10 pain)
 Select outcome measures to be studied ( Tiers 1-3)Select outcome measures to be studied ( Tiers 1-3)
 Convert outcome measure to scale (0-100% pain relief)Convert outcome measure to scale (0-100% pain relief)
 Define success range for outcomes (70-100)Define success range for outcomes (70-100)
 Collect outcomes for study time interval (3-12 months)Collect outcomes for study time interval (3-12 months)
 Collect cost data = total payments to all providersCollect cost data = total payments to all providers
 Enter outcome and cost data into spreadsheetEnter outcome and cost data into spreadsheet
 Prepare formula summary table based on resultsPrepare formula summary table based on results
 Use table results to optimize value and successUse table results to optimize value and success
 Plot graph of value over study duration to compare proceduresPlot graph of value over study duration to compare procedures

10. Lumbar Epidural SteroidLumbar Epidural Steroid

11. Lumbar DiscectomyLumbar Discectomy

13. Cross Over to DiscectomyCross Over to Discectomy

14. Value Formula Summary TableValue Formula Summary Table
12 Months12 Months
 CPT VALUE SUCCESS COSTCPT VALUE SUCCESS COST
 62311/63030 23 100% $36,19562311/63030 23 100% $36,195
 63030 9 100% $103,75063030 9 100% $103,750

16. Value-Based ConclusionsValue-Based Conclusions
 The goal of care is to maximize group valueThe goal of care is to maximize group value
 Maximum value is not always max effectivenessMaximum value is not always max effectiveness
 Maximum value is not always evidence-basedMaximum value is not always evidence-based
 Less effective procedures may have high valueLess effective procedures may have high value
 Sequence procedures to maximize group valueSequence procedures to maximize group value
 Order procedures to perform high value firstOrder procedures to perform high value first
 Perform high success low value procedures lastPerform high success low value procedures last
 Eliminate ineffective unsuccessful proceduresEliminate ineffective unsuccessful procedures

18. To use the Macon Value FormulaTo use the Macon Value Formula
 Request a copy of the spread sheet for use inRequest a copy of the spread sheet for use in
your practice to compare intervention groupsyour practice to compare intervention groups
 E-mail :E-mail : macon@fnspine.commacon@fnspine.com and requestand request
 Website: www.fnspine.comWebsite: www.fnspine.com
 The Macon value formula is copyright protectedThe Macon value formula is copyright protected
by the U.S. Copyright Officeby the U.S. Copyright Office
 Credit the formula to the author when data isCredit the formula to the author when data is
presented or published.presented or published.

19. E-mail :E-mail : macon@fnspine.commacon@fnspine.com
 ICD 9 of studyICD 9 of study
 CPT for all groupsCPT for all groups
 Group sizeGroup size
 Number of groups in studyNumber of groups in study
 Success range definitionSuccess range definition
 Crossover designCrossover design
 Return e-mail addressReturn e-mail address