A Novel,Synergistic Model in Total Joint Arthroplasty: A Report of 2 Specialty Hospitals With Joint Ownership Between Physicians and Healthcare Systems

BackgroundIn 2010, the Affordable Care Act introduced new restrictions on the expansion of physician-owned hospitals (POHs) due to concerns over financial incentives and increased costs. The purpose of this study is to determine whether joint ventures between tertiary care and specialty hospitals (SHs) allowing physician ownership (POHs) have improved outcomes and lower cost following THA and TKA.MethodsAfter institutional review board approval, a retrospective review of consecutive series of primary THA and TKA patients from 2015 to 2016 across a single institution comprised of 14 full-service hospitals and 2 SHs owned as a joint venture between physicians and their health system partners. Ninety-day episode-of-care claims cost data from Medicare and a single private insurer were reviewed with the collection of the same demographic data, medical comorbidities, and readmission rates for both the SHs and non-SHs. A multivariate regression analysis was performed to determine the independent effect of the SHs on episode-of-care costs.ResultsOf the 6537 patients in the study, 1936 patients underwent a total joint arthroplasty at an SH (29.6%). Patients undergoing a procedure at an SH had shorter lengths of stay (1.29 days vs 2.23 days for Medicare, 1.15 vs 1.86 for private payer, both P < .001), were less likely to be readmitted (4% vs 7% for Medicare, P = .001), and had lower mean 90-day episode-of-care costs ($16,661 vs $20,579 for Medicare, $26,166 vs $35,222 for private payers, both P < .001). When controlling for the medical comorbidities and demographic variables, undergoing THA or TKA at an SH was associated with a decrease in overall episode costs ($3266 for Medicare, $13,132 for private payer, both P < .001).ConclusionEven after adjusting for a healthier patient population, the joint venture partnership with health systems and physician-owned SHs demonstrated lower 90-day episode-of-care costs than non-SHs following THA and TKA. Policymakers and practices should consider these data when considering the current care pathways.     

Can Prior Episode-of-Care Costs Predict the Future? Identifying High-Cost Outliers for Subsequent Total Hip and Knee Arthroplasty

BackgroundIt remains unknown if a patient’s prior episode-of-care (EOC) costs for total hip (THA) or knee (TKA) arthroplasty procedure can be used to predict subsequent costs for future procedures. The purpose of this study is to evaluate whether there is a correlation between the EOC costs for a patient’s index and subsequent THA or TKA.MethodsWe reviewed a consecutive series of 11,599 THA and TKA Medicare patients from 2015 to 2019 and identified all patients who underwent a subsequent THA and TKA during the study period. We collected demographics, comorbidities, short-term outcomes, and 90-day EOC claims costs. A multivariate analysis was performed to identify whether prior high-EOC costs were predictive of high costs for the subsequent procedure.ResultsOf the 774 patients (6.7%) who underwent a subsequent THA or TKA, there was no difference in readmissions (4% vs 5%, P = .70), rate of discharge to a skilled nursing facility (SNF) (15% vs 15%, P = .89), and mean costs ($18,534 vs $18,532, P = .99) between EOCs. High-cost patients for the initial TKA or THA were more likely to be high cost for subsequent procedure (odds ratio 14.33, P < .01). Repeat high-cost patients were more likely to discharge to an SNF for their first and second EOC compared to normative-cost patients (P < .01).ConclusionHigh-cost patients for their initial THA or TKA are likely to be high cost for a subsequent procedure, secondary to a high rate of SNF utilization. Efforts to reduce costs in repeat high-cost patients should focus on addressing post-operative needs pre-operatively to facilitate safe discharge home.     

Bundled Payments Are Effective in Reducing Costs Following Bilateral Total Joint Arthroplasty

BackgroundAlternative payment models such the Centers for Medicare and Medicaid Services Bundled Payments for Care Improvement (BPCI) initiative have been effective in reducing costs following unilateral total hip (THA) and knee arthroplasty (TKA), but few studies exist on bilateral arthroplasty. This study aimed to determine whether the BPCI program for bilateral THA and TKA reduced episode-of-care costs.MethodsWe retrospectively reviewed a consecutive series of patients who underwent simultaneous bilateral primary THA and TKA between 2015 and 2016. We recorded demographic variables, comorbidities, readmissions, and calculated 90-day episode-of-care costs based on Centers for Medicare and Medicaid Services claims data. We compared data from patients before and after the start of our BPCI program, and performed a multivariate analysis to identify independent risk factors for increased costs.ResultsOf 319 patients, 38 underwent bilateral THA (12%) while 287 underwent bilateral TKA (88%). There were 239 patients (74%) in the bundled payment group. Although there was no change in readmission rate (9% vs 8%), the post-BPCI group demonstrated reduced hospital costs ($21,251 vs $18,783), post–acute care costs ($15,488 vs $12,439), and overall 90-day episode-of-care costs ($39,733 vs $34,305). When controlling for demographics, procedure, and comorbidities, our BPCI model demonstrated a per-patient reduction of $5811 in overall claims costs. Additional risk factors for increased episode-of-care costs included age ($516/y increase) and cardiac disease ($5916).ConclusionOur bundled payment program for bilateral THA and TKA was successful with reduction in 90-day episode-of-care costs without placing the patient at higher risk of readmission. Older Medicare beneficiaries and those with cardiac disease should likely not undergo a simultaneous bilateral procedure due to concerns about increased costs.     

High Bundled Payment Costs Following Total Hip and Knee Arthroplasty in African Americans

BackgroundConcerns exist that minorities who utilize more resources in an episode-of-care following total hip (THA) and knee arthroplasty (TKA) may face difficulties with access to quality arthroplasty care in bundled payment programs. The purpose of this study is to determine if African American patients undergoing TKA or THA have higher episode-of-care costs compared to Caucasian patients.MethodsWe queried Medicare claims data for a consecutive series of 7310 primary TKA and THA patients at our institution from 2015 to 2018. We compared patient demographics, comorbidities, readmissions, and 90-day episode-of-care costs between African American and Caucasian patients. A multivariate regression analysis was performed to identify the independent effect of race on episode-of-care costs.ResultsCompared to Caucasians, African Americans were younger, but had higher rates of pulmonary disease and diabetes. African American patients had increased rates of discharge to a rehabilitation facility (20% vs 13%, P < .001), with higher subacute rehabilitation ($1909 vs $1284, P < .001), home health ($819 vs $698, P = .022), post-acute care ($5656 vs $4961, P = .008), and overall 90-day episode-of-care costs ($19,457 vs $18,694, P = .001). When controlling for confounding comorbidities, African American race was associated with higher episode-of-care costs of $440 (P < .001).ConclusionAfrican American patients have increased episode-of-care costs following THA and TKA when compared to Caucasian patients, mainly due to increased rates of home health and rehabilitation utilization. Further study is needed to identify social variables that can help reduce post-acute care resources and prevent reduction in access to arthroplasty care in bundled payment models.     

Formal Physical Therapy Following Total Hip and Knee Arthroplasty Incurs Additional Cost Without Improving Outcomes

BackgroundRecent evidence has demonstrated that formal physical therapy (PT) may not be required for most patients undergoing total hip (THA) and knee (TKA) arthroplasty. This study compared the differences in costs and functional outcomes in patients receiving formal PT and those who did not follow primary THA and TKA.MethodsWe queried claims data from a single private insurer identifying patients who underwent primary THA or TKA from 2015 to 2017 in our practice. Demographics, comorbidities, number, and cost of PT visits in a 90-day episode of care were recorded. Outcomes were compared between patients using self-directed home exercises, home PT, outpatient PT, or both home and outpatient PT. A multivariate analysis was performed to identify significant predictors of outcomes.ResultsOf the 2971 patients included in analysis, patients using both services had higher 90-day PT costs (mean $2091, P < .001) than those using home PT alone ($1146), outpatient PT alone ($1356), or no formal PT ($0). Home PT had the greatest cost per visit for both private insurance patients ($177/visit) and Medicare Advantage patients ($157/visit), but patients using both home PT and outpatient PT services had the greatest overall PT cost, $2091 for private insurance and $1891 for Medicare Advantage. Patients who used home PT were at significantly higher risk of both complications (odds ratio = 3.21; 95% confidence interval, 2.1-4.9; P < .001) and readmissions (odds ratio = 3.4; 95% confidence interval, 2.1-5.5; P < .001).ConclusionParticipation in formal PT accounts for up to 8% of the episode of care following THA and TKA. The role of formal PT for most patients should take into account the cost-effectiveness of the intervention.     

Conversion Total Knee Arthroplasty is Associated with Increased Post-Acute Care Costs

BackgroundAlternative payment models have been viewed as successfully decreasing costs following primary total knee arthroplasty (TKA) while maintaining quality. Concerns exist regarding access to care for patients who may utilize more resources in a bundled payment arrangement. The purpose of this study is to determine if patients undergoing conversion of prior surgery to TKA have increased costs compared to primary TKA patients.MethodsClaims from Medicare and a single private insurer were queried for all primary TKA patients at our institution from 2015 to 2016. Ninety-day post-acute care costs were compared between primary and conversion TKA. Secondary endpoints included discharge disposition, complications, and readmissions. A multivariate regression analysis was performed to identify independent risk factors for increased post-acute care costs and short-term outcome metrics.ResultsOf 3999 primary TKA procedures, 948 patients (23%) underwent conversion TKA. Conversion TKA was associated with greater post-acute care costs in patients with commercial insurance ($4714 vs $3759, P = .034). Among Medicare beneficiaries, prior ligament reconstruction was associated with increased post-acute care costs ($1917 increase, P = .036), while prior fracture fixation approached statistical significance ($2402 increase, P = .055). Conversion TKA was an independent risk factor for readmissions (odds ratio 1.46, 95% confidence interval 1.00-2.17, P = .050), while patients with a prior open knee procedure had higher rates of complications (odds ratio 2.41, 95% confidence interval 1.004-5.778, P = .049).ConclusionOur data suggest that conversion from prior knee surgery to TKA is associated with increased 90-day post-acute care costs and resource utilization, particularly prior open procedures. Without appropriate risk adjustment in alternative payment models, surgeons may be financially deterred from providing quality arthroplasty care given the reduced net payment and surgical complexity of such cases.     

Target Price Adjustment for Hip Fractures Is Not Sufficient in the Bundled Payments for Care Improvement Initiative

BackgroundUnder the Bundled Payments for Care Improvement (BPCI) initiative, the Centers for Medicare and Medicaid Services (CMS) adjusts the target price for total hip arthroplasty (THA) based upon the historical proportion of fracture cases. Concerns exist that hospitals that care for hip fracture patients may be penalized in BPCI. The purpose of this study is to compare the episode-of-care (EOC) costs of hip fracture patients to elective THA patients.MethodsWe reviewed a consecutive series of 4096 THA patients from 2015 to 2018. Patients were grouped into elective THA (n = 3686), fracture THA (n = 176), and hemiarthroplasty (n = 274). Using CMS claims data, we compared EOC costs, postacute care costs, and performance against the target price between the groups. To control for confounding variables, we performed a multivariate analysis to identify the effect of hip fracture diagnosis on costs.ResultsElective THA patients had lower EOC ($18,200 vs $42,605 vs $38,371; P < .001) and postacute care costs ($4477 vs $28,093 vs $23,217; P < .001) than both hemiarthroplasty and THA for fracture. Patients undergoing arthroplasty for fracture lost an average of $23,122 (vs $1648 profit for elective THA; P < .001) with 91% of cases exceeding the target price (vs 20% for elective THA; P < .001). In multivariate analysis, patients undergoing arthroplasty for fracture had higher EOC costs by $19,492 (P < .001).ConclusionPatients undergoing arthroplasty for fracture cost over twice as much as elective THA patients. CMS should change their methodology or exclude fracture patients from BPCI, particularly during the COVID-19 pandemic.     

Staging Total Hip and Knee Arthroplasty Procedures Within 90 Days Increases Costs in Bundled Payment Programs

BackgroundUnder current Medicare bundled payment programs, when a patient undergoes a subsequent elective procedure within the 90-day episode-of-care, the first procedure is excluded from the bundle and a new episode-of-care initiated. The purpose of this study was to determine if staging bilateral total hip (THA) and total knee arthroplasty (TKA) procedures within 90 days have an effect on bundled episode-of-care costs.MethodsWe reviewed a consecutive series of Medicare patients undergoing staged primary THA and TKA from 2015-2019. Patients who underwent a prior procedure within 90 days were compared to those who had undergone a procedure 90-120 days prior. We then performed a multivariate analysis to identify the independent effect of staging timeframe on costs and outcomes.ResultsOf the 136 patients undergoing a staged bilateral THA or TKA, 48 patients underwent staged procedures within 90 days (35%) and 88 patients between 91-120 days (65%). There were no significant differences observed for demographics, comorbidities, complications, readmissions, or discharge disposition (all P > .05). Patients undergoing a staged procedure within 90 days had increased episode-of-care costs by $2021 (95% CI $11-$4032, P = .049), increased postacute care costs by $2019 (95% CI $66-$3971, P < .001), and reduced per-patient margin by $2868 (95% CI-$866-$4869, P = .005).DiscussionPatients undergoing staged bilateral THA or TKA within 90 days have increased episode-of-care costs compared to those undergoing a staged procedure from 91-120 days. Since patients may still not be fully recovered from the first procedure, CMS should address the inappropriate allocation of costs to ensure institutions are not penalized.     

From Winners to Losers: The Methodology of Bundled Payments for Care Improvement Advanced Disincentivizes Participation in Bundled Payment Programs

BackgroundThe Bundled Payments for Care Improvement (BPCI) initiative improved quality and reduced costs following total hip (THA) and knee arthroplasty (TKA). In October 2018, the BPCI-Advanced program was implemented. The purpose of this study is to compare the quality metrics and performance between our institution’s participation in the BPCI program with the BPCI-Advanced initiative.MethodsWe reviewed a consecutive series of Medicare primary THA and TKA patients. Demographics, medical comorbidities, discharge disposition, readmission, and complication rates were compared between BPCI and BPCI-Advanced groups. Medicare claims data were used to compare episode-of-care costs, target price, and margin per patient between the cohorts.ResultsCompared to BPCI patients (n = 9222), BPCI-Advanced patients (n = 2430) had lower rates of readmission (5.8% vs 3.8%, P = .001) and higher rate of discharge to home (72% vs 78%, P < .001) with similar rates of complications (4% vs 4%, P = .216). Medical comorbidities were similar between groups. BPCI-Advanced patients had higher episode-of-care costs ($22,044 vs $18,440, P < .001) and a higher mean target price ($21,154 vs $20,277, P < .001). BPCI-Advanced patients had a reduced per-patient margin compared to BPCI ($890 loss vs $1459 gain, P < .001), resulting in a $2,138,670 loss in the first three-quarters of program participation.ConclusionDespite marked improvements in quality metrics, our institution suffered a substantial loss through BPCI-Advanced secondary to methodological changes within the program, such as the exclusion of outpatient TKAs, facility-specific target pricing, and the elimination of different risk tracks for institutions. Medicare should consider adjustments to this program to keep surgeons participating in alternative payment models.     

Is the New Outpatient Prospective Payment System Classification for Outpatient Total Knee Arthroplasty Appropriate?

BackgroundIn 2018, the Centers for Medicare and Medicaid Services removed total knee arthroplasty (TKA) from the inpatient-only list, resulting in payment through the Outpatient Prospective Payment System with an average $3157 reduction. The purpose of this study is to determine if the reimbursement is justified by comparing the difference in facility costs between inpatient and outpatient TKAs.MethodsWe identified 4496 consecutive primary TKA procedures performed at 2 hospitals from 2015 to 2019. Itemized facility costs were calculated using a time-driven activity-based costing algorithm. Outpatient procedures were defined as those with a length of stay of less than 2 midnights (3851, 86%). Patient demographics, comorbidities, and itemized costs were compared between groups. A multivariate regression analysis was performed to determine the independent effect of outpatient status on true facility costs.ResultsOutpatient TKA patients had lower mean postoperative personnel costs ($1809 vs $947, P < .001), supply costs ($4347 vs $4229, P < .001), and overall total facility costs ($7371 vs $6937, P < .001) than inpatient TKA patients. Controlling for a younger patient cohort with fewer medical comorbidities, outpatient status was associated with a reduction in total facility costs of $972 (95% confidence interval $883-$1060, P < .001) compared to inpatient TKA.ConclusionOutpatient TKA costs hospitals nearly $1000 per patient less than inpatient TKA, yet the average difference in Medicare reimbursement for an outpatient procedure is $3157 less per patient. Centers for Medicare and Medicaid Services should reconsider the Outpatient Prospective Payment System classification of TKA to better incentivize surgeons to perform TKA as a lower cost outpatient procedure when safe and appropriate.     

Surgeon Reimbursement Unchanged as Hospital Charges and Reimbursements Increase for Total Joint Arthroplasty

BackgroundDespite increasing demands on physicians and hospitals to increase value and reduce unnecessary costs, reimbursement for healthcare services has been under downward pressure for several years. This study aimed to analyze the trend in hospital charges and payments relative to corresponding surgeon charges and payments in a Medicare population for total hip (THA) and knee arthroplasty (TKA).MethodsThe 5% Medicare sample database was used to capture hospital and surgeon charges and payments related to 56,228 patients who underwent primary THA and 117,698 patients who underwent primary TKA between 2005 and 2014. Two values were calculated: (1) the charge multiplier (CM), the ratio of hospital to surgeon charges and (2) the payment multiplier (PM), the ratio of hospital to surgeon payments. Year-to-year variation and regional trends in patient demographics, Charlson Comorbidity Index, length of stay (LOS), CM, and PM were evaluated.ResultsHospital charges were significantly higher than surgeon charges and increased substantially for both THA (CM increased from 8.7 to 11.5, P < .0001) and TKA (CM increased from 7.9 to 11.4, P < .0001). PM followed a similar trend, increasing for both THA and TKA (P < .0001). LOS decreased significantly for both THA and TKA (P < .0001), while Charlson Comorbidity Index remained stable. Both CM (r² = 0.84 THA, 0.90 TKA) and PM (r² = 0.75 THA, 0.84 TKA) were strongly negatively associated with LOS.ConclusionHospital charges and payments relative to surgeon charges and payments have increased substantially for THA and TKA despite stable patient complexity and decreasing LOS.     

Are Ceramic Bearings Becoming Cost-Effective for All Patients Within a 90-Day Bundled Payment Period?

BackgroundWe analyzed whether the total hospital cost in a 90-day bundled payment period for ceramic-on-polyethylene (C-PE) and ceramic-on-ceramic (COC) total hip arthroplasty (THA) bearings was changing over time, and whether the cost differential between ceramic bearings and metal-on-polyethylene (M-PE) bearings was approaching the previously published tipping point for cost-effectiveness of US$325.MethodsA total of 245,077 elderly Medicare patients (65+) who underwent primary THA between 2010 and 2015 were identified from the United States Medicare 100% national administrative hospital claims database. The total inpatient cost, calculated up to 90 days after index discharge, was computed using cost-to-charge ratios, and hospital payment was analyzed. The differential total inpatient cost of C-PE and COC bearings, compared to metal-on-polyethylene (M-PE), was evaluated using parametric and nonparametric models.ResultsAfter adjustment for patient and clinical factors, and the year of surgery, the mean hospital cost up to 90 days for primary THA with C-PE or COC was within ±1% of the cost for primary THA with M-PE bearings (P < .001). From the nonparametric analysis, the median total hospital cost was US$296-US$353 more for C-PE and COC than M-PE. Cost differentials were found to decrease significantly over time (P < .001).ConclusionPatient and clinical factors had a far greater impact on the total cost of inpatient THA surgery than bearing selection, even when including readmission costs up to 90 days after discharge. Our findings indicate that the cost-effectiveness thresholds for ceramic bearings relative to M-PE are changing over time and increasingly achievable for the Medicare population.     

Trends in Revenue,Cost, and Contribution Margin for Total Joint Arthroplasty 2011-2021

BackgroundRegulatory change has created a growing demand to decrease the hospital costs associated with primary total joint arthroplasty (TJA). Concurrently, the removal of lower extremity TJA from the in-patient only list has affected hospital reimbursement. The purpose of this study is to investigate trends in hospital revenue versus costs in primary TJA.MethodsWe retrospectively reviewed all patients who underwent primary TJA from June 2011 to May 2021 at our institution. Patient demographics, revenue, total cost, direct cost, and contribution margin were collected. Changes over time as a percentage of 2011 numbers were analyzed. Linear regression analysis was used to determine overall trend significance and develop projection models.ResultsTotal knee arthroplasty (TKA) insured by government-managed/Medicaid (GMM) plans showed a significant upward trend (P = .013) in total costs. Direct costs of TKA across all insurance providers (P = .001 and P < .001) and total hip arthroplasty (THA) for Medicare (P = .009) and GMM (P = .001) plans demonstrated significant upward trends. Despite this, 2011-2021 modeling found no significant change in contribution margin for TKA and THA covered under all insurance plans. However, models based on 2018-2021 financial data demonstrated a significant downward trend in contribution margin across Medicare (P < .001) and GMM (P < .001) insurers for both TKA and THA.ConclusionPhysician-led innovation in cost-saving strategies has maintained contribution margin over the past decade. However, the increase in direct costs seen over the past few years could lead to negative contribution margins over time, if further efficiency and cost-saving measures are not developed.Level III EvidenceRetrospective Cohort Study.     

In a Bundled Payment Model,the Costs Associated With Total Joint Replacement in Those Aged Older Than 80 Years Are Significantly Greater

BackgroundThe number of octogenarians requiring a total hip arthroplasty (THA) and/or total knee arthroplasty (TKA) will rise disproportionally in the coming decade. Although outcomes are comparable with younger patients, management of these older patients involves higher medical complexity at a greater expense to the hospital system. The purpose of this study was to compare the cost of care for primary THA and TKA in our bundled care patients aged ≥80 years to those aged 65-80 years.MethodsA retrospective review of primary TKA (n = 641) and THA (n = 1225) cases from 2013 to 2017 was performed. Patient demographic and admission cost data were collected. Patients were grouped based on surgery type (ie, elective or nonelective THA/TKA) and age group (ie, older [≥80 years old] or younger [65-80 years old]). Multivariate regression analyses were used to account for demographic differences.ResultsElective primary THA in the older cohort (n = 157) cost 24.5% more than the younger cohort (n = 1025) (P < .0001). Elective primary TKA cases in the older cohort (n = 87) cost 17.0% more than the younger cohort’s (n = 554) (P < .0001). For nonelective THA cases, the older cohort’s (n = 29) episodes cost 39.1% more than the younger cohort (n = 14) (P < .0001). When comparing the <80 elective THA cohort (n = 1025) to the ≥90 cohort (n = 10), the cost difference swelled to 58.7% (P < .0001).ConclusionAlthough primary THA and TKA in ≥80-year-old patients yield similar outcomes, this study demonstrates that the additional measures required to care for older patients and ensure successful outcomes cost significantly more. Consideration should be given to age as a factor in determining reimbursement in a bundled payment system to reduce the incentive to restrict care to elderly patients.     

Conversion Total Knee Arthroplasty Needs Its Own Diagnosis-Related Group Code

BackgroundConversion from a prior knee procedure has been demonstrated to require greater operative times and resources, but still lacks a separate procedural or facility code from primary total knee arthroplasty (TKA). The purpose of this study is to determine differences in facility costs between patients who underwent primary TKA and those who underwent conversion TKA.MethodsWe retrospectively reviewed a consecutive series of patients undergoing primary TKA at 2 hospitals from 2015 to 2017, comparing itemized facility costs between primary and conversion TKA patients. A multivariate regression analysis was performed to identify independent risk factors for increased facility costs, the need for additional implants, length of stay, and discharge disposition.ResultsOf 2447 TKA procedures, 678 (27.7%) underwent conversion TKA, which was associated with greater implant costs ($3931.47 vs $2864.67, P = .0120) and total facility costs in a multivariate regression ($94.30 increase, P = .0316). When controlling for confounding variables, patients with a prior ligament reconstruction ($402 increase, P = .0002) and prior open reduction and internal fixation ($847 increase, P = .0020) had higher costs and were more likely to require stemmed implants (P < .05). There was an increase in TKA implant cost by $538 in patients with implants from a prior procedure (P < .0001).ConclusionConversion TKA is associated with greater implant and inpatient facility costs than primary TKA, particularly those who had a history of an open knee procedure. A separate diagnosis-related group should be created for conversion TKA given the increased cost and complexity of these procedures compared to primary TKA.     

Hospital Revenue,Cost, and Contribution Margin in Inpatient Versus Outpatient Primary Total Joint Arthroplasty

BackgroundRemoval of primary total knee arthroplasty (TKA) and primary total hip arthroplasty (THA) from the inpatient-only list has financial implications for both patients and institutions. The aim of this study was to evaluate and compare financial parameters between patients designated for inpatient versus outpatient total joint arthroplasty.MethodsWe reviewed all patients who underwent TKA or THA after these procedures were removed from the inpatient-only list. Patients were statistical significance into cohorts based on inpatient or outpatient status, procedure type, and insurance type. This included 5,284 patients, of which 4,279 were designated inpatient while 1,005 were designated outpatient. Patient demographic, perioperative, and financial data including per patient revenues, total and direct costs, and contribution margins (CMs) were collected. Data were compared using t-tests and Chi-squared tests.ResultsAmong Medicare patients receiving THA, CM was 89.1% lower for the inpatient cohort when compared to outpatient (P < .001), although there was no statistical significance difference between cohorts for TKA (P = .501). Among patients covered by Medicaid or Government-managed plans, CM was 120.8% higher for inpatients receiving THA (P < .001) when compared to outpatients and 136.3% higher for inpatients receiving TKA (P < .001).ConclusionOur analyses showed that recent costs associated with inpatient stay inconsistently match or outpace additional revenue, causing CM to vary drastically depending on insurance and procedure type. For Medicare patients receiving THA, inpatient surgery is financially disincentivized leaving this vulnerable patient population at a risk of losing access to care.Level III EvidenceRetrospective Cohort Study.     

High-Quality Skilled Nursing Facilities Are Associated With Decreased Episode-of-Care Costs Following Total Hip and Knee Arthroplasty

BackgroundWith the increasing popularity of alternative payment models following total hip (THA) and knee arthroplasty (TKA), efforts have focused on reducing post-acute care (PAC) costs, particularly patients discharged to skilled nursing facilities (SNFs). The purpose of this study is to determine if preferentially discharging patients to high-quality SNFs can reduce bundled payment costs for primary THA and TKA.MethodsAt our institution, a quality improvement initiative for SNFs was implemented at the start of 2017, preferentially discharging patients to internally credentialed facilities, designated by several quality measures. Claims data from Centers for Medicare and Medicaid Services were queried to identify patients discharged to SNF following primary total joint arthroplasty. We compared costs and outcomes between patients discharged to credentialed SNF sites and those discharged to other sites.ResultsBetween 2015 and 2018, of a consecutive series of 8778 primary THA and TKA patients, 1284 (14.6%) were discharged to an SNF. Following initiation of the program, 498 patients were discharged to an SNF, 301 (60.4%) of which were sent to a credentialed facility. Patients at credentialed facilities had significantly lower SNF costs ($11,184 vs $8198, P < .0001), PAC costs ($18,952 vs $15,148, P < .0001), and episode-of-care costs ($34,557 vs $30,831, P < .0001), with no difference in readmissions (10% vs 12%, P = .33) or complications (8% vs 6%, P = .15). Controlling for confounding variables, being discharged to a credentialed facility decreased SNF costs by $1961 (P = .0020) and PAC costs by $3126 (P = .0031) per patient.ConclusionQuality improvement efforts through partnership with selective SNFs can significantly decrease PAC costs for patients undergoing primary THA and TKA.     

Life After BPCI: High Quality Total Knee and Hip Arthroplasty Care Can Still Exist Outside of a Bundled Payment Program

BackgroundConcerns regarding target price methodology and financial penalties have led to withdrawal from Medicare bundled payment programs for total hip (THA) and knee arthroplasty (TKA), despite its early successful results. The purpose of this study was to determine whether there was any difference in patient comorbidities and outcomes following our institution’s exit from the Bundled Payments for Care Improvement - Advanced (BPCI-A).MethodsWe reviewed consecutive 2,737 primary TKA and 2,009 primary THA patients following our withdraw from BPCI-A January 1, 2020-March 30, 2021 and compared them to 1,203 TKA and 1,088 THA patients from October 1, 2018-August 2, 2019 enrolled in BPCI-A. We compared patient demographics, comorbidities, discharge disposition, complications, and 90-day readmissions.Multivariate analysis was performed to identify if bundle participation was associated with complications or readmissions.ResultsPost-bundle TKA had shorter length of stay (1.4 vs 1.8 days, P < .001). Both TKA and THA patients were significantly less likely to be discharged to a rehabilitation facility (5.6% vs 19.2%, P < .001 and 6.0% vs 10.0%, P < .001, respectively). Controlling for confounders, post-bundle TKA had lower complications (OR = 0.66, 95% CI 0.45-0.98, P = .037) but no difference in 90-day readmission (OR = 0.80, 95% CI 0.55-1.16, P = .224).ConclusionsSince leaving BPCI-A, we have maintained high quality THA care and improved TKA care with reduced complications and length of stay under a fee-for-service model. Furthermore, we have lowered rehabilitation discharge for both TKA and THA patients. CMS should consider partnering with high performing institutions to develop new models for risk sharing.     

Skilled Nursing Facilities After Total Knee Arthroplasty: The Time for Selective Partnerships Is Now!

Background

Bundled payment initiatives for total knee arthroplasty (TKA) patients are dramatically impacted by discharges to skilled nursing facilities (SNFs), making target prices set by the Center for Medicare and Medicaid Services difficult to achieve. However, we hypothesized that a granular examination of SNF discharges would reveal that some may disproportionately increase costs compared to others.

The Economics of Antibiotic Cement in Total Knee Arthroplasty: Added Cost with No Reduction in Infection Rates

BackgroundTo reduce the substantial clinical and financial burden of periprosthetic joint infection (PJI), some surgeons advocate for the use of antibiotic-loaded bone cement (ALBC) in primary total knee arthroplasty (TKA), although its effectiveness continues to be debated in the literature. The purpose of this study was to determine whether the routine use of ALBC is cost-effective in reducing PJI after primary TKA.MethodsWe retrospectively reviewed a consecutive series of patients undergoing cemented primary TKA at two hospitals within our institution from 2015 to 2017. We compared demographics, comorbidities, costs, and PJI rates between patients receiving ALBC and plain cement. We performed a multivariate regression analysis to determine the independent effect of ALBC on PJI rate. We calculated readmission costs for PJI and reduction in PJI needed to justify the added cost of ALBC.ResultsOf 2511 patients, 1077 underwent TKA with ALBC (43%), with no difference in PJI rates (0.56% vs 0.14%, P = .0662) or complications (1.2% vs 1.6%, P = .3968) but higher cement costs ($416 vs $117, P < .0001) and overall procedure costs ($6445 vs $5.968, P < .0001). ALBC had no effect on infection rate (P = .0894). Patients readmitted with PJI had higher overall 90-day episode-of-care claims costs ($49,341 vs $19,032, P < .001). To justify additional costs, ALBC would need to prevent infection in one of every 101 patients.ConclusionRoutine use of ALBC in primary TKA is not cost-effective, adding $299 to the cost of episode of care without a reduction in PJI rate. Further study is needed to determine whether select use of ALBC would be justified in high-risk patients.