Fewer liver patients are reaching Medicare wards, but the ones who do are costing the program more per admission than most open-heart procedures. That combination deserves attention.

Between 2013 and 2023, total Medicare discharges for liver and hepatic DRGs fell from 32,811 to 19,494, a drop of more than 13,000 cases. Over the same period, the weighted average payment per discharge rose from $15,637 to $24,367, a 55.8% increase. The patient population shrank by 40%. The per-case cost grew by more than half.

A Cost Comparison That Reframes the Cardiac Surgery Benchmark

Open-heart surgery is the intuitive reference point for expensive hospital care. Cardiac valve procedures without catheterization (DRG 219) averaged $66,747 per Medicare discharge in 2023, and coronary bypass with catheterization (DRG 233) averaged $55,467. Those figures are real, and they are large.

But the comparison that matters more is at the margin. Coronary bypass without catheterization (DRG 234) averaged $35,040 per discharge in 2023 across 6,031 cases. The national average for liver-related DRGs was $24,367 that same year. The gap is narrower than most analysts assume, and in high-cost states it closes further. Maryland's average liver-DRG payment of $29,758 per discharge sits only $5,282 below that bypass benchmark, while running 77.3% above the national liver-DRG average of $16,782.

For Medicare, the practical consequence is straightforward: a liver admission in Maryland costs the program roughly what a bypass surgery costs in a moderate-cost state.

The Geographic Spread Is Wider Than the National Average Suggests

California led all states in total Medicare spending on liver-related DRGs in 2023, with $150,470,493 across 5,612 discharges at 95 hospitals. Its per-discharge average of $26,812 ran about $10,030 above the national figure. New York averaged $21,220, or 26.4% above the national average. Both states are expensive, but neither approaches Maryland's premium.

Florida tells the opposite story. With 4,645 discharges, Florida had the second-highest volume among the top states, but its average payment of $14,146 per discharge was $2,636, or 15.7%, below the national average. A liver admission in Florida costs Medicare roughly half what the same admission costs in Maryland.

That $15,612 spread between Maryland and New Jersey, for the same category of admission, reflects how dramatically Medicare's actual outlays vary by geography. For a program that sets national policy, that variance is a structural problem, not a rounding error.

The Volume Drop Makes the Cost Trend Harder to Interpret

The 40% decline in liver-related Medicare discharges between 2013 and 2023 is not obviously good news. When a population shrinks while average costs rise, the remaining cases are almost certainly more severe. Patients who once received outpatient management or shorter inpatient stays may have been diverted out of the inpatient DRG system entirely, leaving behind a concentrated group of high-acuity admissions.

Major cardiac surgery DRGs, by contrast, grew in volume over the same period, reaching 114,762 discharges in 2021 at a weighted average of $49,640. That category's cost increase from $42,674 in 2013 to $49,640 in 2021 (16.4%) is modest compared to liver DRGs' 55.8% rise over a longer window. Cardiac surgery costs more per case in absolute terms, but liver-related admissions are closing the gap faster, with fewer cases absorbing more dollars each year.

Whether the 2023 average of $24,367 reflects a genuinely sicker remaining patient population, changes in DRG coding across the 10 codes that narrowed to 7, or both, is a question the cost trend alone cannot answer. But the direction is unambiguous, and the per-case cost is no longer in a different tier from elective cardiac procedures.