Industry context

The MSK spend opportunity — sources and framing

Employer-facing summary of the funnel from total medical spend → MSK → wear-and-tear → elective orthopedic opportunity. Use this as the narrative when sharing the estimator output with a plan sponsor.

MSK as a share of total medical spend

For self-funded employers, musculoskeletal care is consistently one of the largest medical cost categories. The most defensible general benchmark is that MSK represents roughly 15–20% of total medical spend for most large employer groups. Kaiser Permanente cites MSK treatment costs as nearly 15% of total employer medical costs. A Health Action Council / UnitedHealth Group analysis showed MSK at 13% of spend in that employer-coalition population, while UnitedHealthcare separately reports MSK costing employers $40.51 PMPM in its 2024 book of business. A National Business Group on Health estimate places MSK at approximately 31% of total employer medical expenses, but that should be treated as a high-end benchmark rather than the safest average.

Two-thirds of MSK spend is wear-and-tear

The biggest opportunity is not "all MSK" equally — it's the wear-and-tear / degenerative MSK funnel. Evernorth's commercial-claims analysis defines wear-and-tear MSK as strains, sprains, tendon/ligament tears, ruptured spinal discs, and degenerative joint changes. In commercially insured members under 65, Evernorth found that wear-and-tear conditions account for 63.5% of all MSK-related utilization and cost, compared with 18.6% for trauma, 16.9% for autoimmune/rheumatologic disease, and 1.0% for other MSK conditions. Using the 15–20% total-medical-spend benchmark, wear-and-tear MSK alone represents roughly 9.5–12.7% of total medical spend for a self-funded employer.

Five anatomic regions concentrate the spend

Within wear-and-tear MSK, the spend is highly concentrated. Evernorth found that just five anatomic areas — back, lower leg/knee, neck, hip, and shoulder — account for 80% of wear-and-tear MSK utilization and cost. That equals approximately 50.8% of total MSK spend, or about 7.6–10.2% of total medical spend at the 15–20% MSK benchmark.

• Back — 29% of wear-and-tear spend
• Lower leg / knee — 16%
• Neck — 13%
• Hip — 11%
• Shoulder — 11%

Elective orthopedic procedures — a controllable subset

Elective orthopedic surgeries and procedures are a smaller subset of the wear-and-tear bucket, but they are a major controllable cost category. Public sources don't provide one universal benchmark for "elective ortho as a percent of MSK spend" because definitions vary across inpatient surgery, outpatient surgery, injections, imaging, facility fees, implants, and related professional claims. The safer statement: elective orthopedic procedures are not the majority of MSK spend by themselves, but they're a high-cost, highly actionable subset within wear-and-tear — spine surgery, joint procedures, MRIs, injections, and arthroscopies all sit within this funnel.

The low-value-care opportunity

The low-value-care opportunity is substantial. EviCore/Evernorth cites an estimate that 25–40% of MSK care spending is wasteful or ineffective, with degenerative meniscus arthroscopy highlighted as one example of low-value MSK care when evidence-based conservative care would often be more appropriate. Spine surgery is one of the clearest examples of overuse risk. Lown Institute's Medicare analysis found that U.S. hospitals performed more than 200,000 unnecessary back surgeries over three years, costing Medicare about $2B on average, and that 14% of spinal fusions/laminectomies met overuse criteria. Medicare data, not commercial employer data, but it supports the broader point that back surgery has a meaningful low-value-care component.