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.     

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.     

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.     

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.     

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.     

A Nurse Navigator Program Is Effective in Reducing Episode-of-Care Costs Following Primary Hip and Knee Arthroplasty

BackgroundAlternative payment models for total hip arthroplasty (THA) and total knee arthroplasty (TKA) have incentivized providers to deliver higher quality care at a lower cost, prompting some institutions to develop formal nurse navigation programs (NNPs). The purpose of this study was to determine whether a NNP for primary THA and TKA resulted in decreased episode-of-care (EOC) costs.MethodsWe reviewed a consecutive series of primary THA and TKA patients from 2015-2016 using claims data from the Centers for Medicare and Medicaid Services and Medicare Advantage patients from a private insurer. Three nurse navigators were hired to guide discharge disposition and home needs. Ninety-day EOC costs were collected before and after implementation of the NNP. To control for confounding variables, we performed a multivariate regression analysis to determine the independent effect of the NNP on EOC costs.ResultsDuring the study period, 5275 patients underwent primary TKA or THA. When compared with patients in the prenavigator group, the NNP group had reduced 90-day EOC costs ($19,116 vs $20,418 for Medicare and $35,378 vs $36,961 for private payer, P < .001 and P < .012, respectively). Controlling for confounding variables in the multivariate analysis, the NNP resulted in a $1575 per Medicare patient (P < .001) and a $1819 per private payer patient cost reduction (P = .005). This translates to a cost savings of at least $5,556,600 per year.ConclusionThe implementation of a NNP resulted in a marked reduction in EOC costs following primary THA and TKA. The cost savings significantly outweighs the added expense of the program. Providers participating in alternative payment models should consider using a NNP to provide quality arthroplasty care at a reduced cost.     

An Analysis of Centers for Medicare & Medicaid Service Payment in Maryland: Can a Global Budget Revenue Model Save Money in Lower Extremity Arthroplasty?

Background

Maryland is the only state utilizing the Global Budget Revenue (GBR) model to reduce costs. The purpose of this study is to evaluate whether the GBR payment model effectively reduced the following: (1) costs of inpatient hospital stays; (2) post-acute care costs; (3) lengths of stay (LOS); (4) readmission rates; and (5) discharge disposition in patients who underwent primary total hip and knee arthroplasty (THA and TKA).

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.     

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.     

No Difference in Total Episode-of-Care Cost Between Staged and Simultaneous Bilateral Total Joint Arthroplasty

Background

Due to concerns about higher complication rates, surgeons debate whether to perform simultaneous bilateral total joint arthroplasty (BTJA), particularly in the higher-risk Medicare population. Advances in pain management and rehabilitation protocols have called into question older studies that found an overall cost benefit for simultaneous procedures. The purpose of this study was to compare 90-day episode-of-care costs between staged and simultaneous BTJA among Medicare beneficiaries.

The Cost of an Episode of Care in a Total Knee Arthroplasty Patient Is More Than a Total Hip Arthroplasty Patient Within an Alternative Payment Model

BackgroundAlternative payment models were set up to increase the value of care for total joint arthroplasty. Currently, total knee arthroplasty (TKA) and total hip arthroplasty (THA) are reimbursed within the same bundle. We sought to determine whether it was appropriate for these cases to be included within the same bundle.MethodsThe data were collected from consecutive patients in a bundled payment program at a single large academic institution. All payments for 90 days postoperatively were included in the episode of care. Readmission rates, demographics, and length of stay were collected for each episode of care.ResultsThere was a significant difference in cost of episode of care between TKA and THA, with the average TKA episode-of-care cost being higher than the average THA episode-of-care cost ($25803 vs $23805, P < .0001). There was a statistically significant difference between the 2 groups between gender, race, medical complexity, disposition outcome, and length of stay. The TKA group trended toward a lower readmission rate (5.3%) compared to the THA group (6.6%).ConclusionThe cost of an episode of care for patients within the bundled payment model is significantly higher for patients undergoing TKA compared with those undergoing a THA. This should be taken into consideration when determining payment plans for patients in alternative payment plans, along with other aspects of risk that need to be considered in order to allow for hospitals to be successful under the bundled payment model.     

Are We at the Bottom? BPCI Programs Now Disincentivize Providers Who Maintain Quality Despite Caring for Increasingly Complex Patients

BackgroundThe Bundled Payments for Care Improvement (BPCI) initiative has been successful at reducing Medicare costs after total joint arthroplasty (TJA). Target pricing is based on each institution's historical performance and is periodically reset. The purpose of this study was to examine the performance of our BPCI program accounting for patient complexity, quality, and resource utilization.MethodsWe reviewed a consecutive series of 9195 Medicare patients undergoing primary TJA from 2015 to 2018. Demographics, comorbidities, and readmissions by year were compared. We then examined 90-day episode-of-care costs, changes in target price, and financial margins during the duration of the BPCI program using Medicare claims data.ResultsPatients undergoing TJA in 2018 had a higher prevalence of diabetes and cardiac disease (all P < .001) as compared with those in 2015. From 2015 to 2018, there was a decrease in the rate of discharge to rehabilitation facilities (23% vs 14%, P < .001) and length of stay (2.1 vs 1.7 days, P < .001) with no difference in readmissions (6% vs 6%, P = .945). There was a reduction in postacute care costs ($6076 vs $4,890, P < .001) and 90-day episode-of-care costs ($19,954 vs $18,449, P < .001). However, the target price also decreased ($22,280 vs $18,971, P < .001), and the per-patient margin diminished ($2683 vs $522, P < .001).ConclusionSurgeons have maintained quality of care at a reduced cost despite increasing patient complexity. The target price adjustments resulted in declining margins during the course of our BPCI experience. Policy makers should consider changes to target price methodology to encourage participation in these successful cost-saving programs.     

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.     

Pre-Operative Predictors for Discharge to Post-Acute Care Facilities After Total Knee Arthroplasty

BackgroundJoint replacement surgery is in increasing demand and is the most common inpatient surgery for Medicare beneficiaries. The venue for post-operative rehabilitation, including early outpatient therapy after surgery, influences recovery and quality of life. As part of a comprehensive total joint program at Kaiser Permanente Colorado, we developed and validated a predictive model to anticipate and plan the disposition for rehabilitation of our patients after total knee arthroplasty (TKA).MethodsWe analyzed data for TKA patients who completed a pre-operative Total Knee Risk Assessment in 2017 (the model development cohort) or during the first 6 months of 2018 (the model validation cohort). The Total Knee Risk Assessment, which is used to guide disposition for rehabilitation, included questions in mobility, social, and environment domains. Multivariable logistic regression was used to predict discharge to post-acute care facilities (PACFs) (ie, skilled nursing facilities or acute rehabilitation centers).ResultsData for a total of 1481 and 631 patients who underwent TKA were analyzed in the development and validation cohorts, respectively. Ninety-three patients (6.3%) in the development cohort and 22 patients (3.5%) in the validation cohort were discharged to PACFs. Eight risk factors for discharge to PACFs were included in the final multivariable model. Patients with a diagnosis of neurological disorder and with a mobility/balance issue had the greatest chance of discharge to PACFs.ConclusionThis validated predictive model for discharge disposition following TKA may be used as a tool in shared decision-making and discharge planning for patients undergoing TKA.     

Global Budget Revenue on a Single Institution's Costs and Outcomes in Patients Undergoing Total Hip Arthroplasty

Background

The state of Maryland was granted a waiver by the Center for Medicare and Medicaid Services to implement a Global Budget Revenue (GBR) reimbursement model. This study aims to compare (1) costs of inpatient hospital stays; (2) postacute care costs; (3) lengths of stay (LOS); and (4) discharge disposition who underwent primary total hip arthroplasty at a single Maryland-based orthopedic institution before and after the implementation of GBR.

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.     

The Impact of Discharge Disposition on Episode-of-Care Reimbursement After Primary Total Hip Arthroplasty

Background

Total joint arthroplasty (TJA) accounts for more Medicare expenditure than any other inpatient procedure. The Comprehensive Care for Joint Replacement model was introduced to decrease cost and improve quality in TJA. The largest portion of episode-of-care costs occurs after discharge. This study sought to quantify the cost variation of primary total hip arthroplasty (THA) according to discharge disposition.

Chronic Obstructive Pulmonary Disease Is Associated With Higher Rates of Venous Thromboemboli Following Primary Total Knee Arthroplasty

BackgroundThere is discordance in the literature regarding the presence of chronic obstructive pulmonary disease (COPD) and the development of venous thromboemboli (VTEs). Therefore, the purpose of this study is to determine whether COPD patients undergoing primary total knee arthroplasty (TKA) have higher rates of (1) in-hospital lengths of stay (LOS); (2) readmissions; (3) VTEs; and (4) costs of care.MethodsCOPD patients undergoing primary TKA were identified and matched to controls in a 1:5 ratio by age, gender, and medical comorbidities. Patients with a history of VTEs or hypercoagulable states were excluded. The query yielded 211,378 patients in the study (n = 35,230) and control (n = 176,148) cohorts. Outcomes analyzed included in-hospital LOS, readmission rates, VTEs, and costs of care. A P-value less than .01 was considered statistically significant.ResultsCOPD patients were found to have significantly longer in-hospital LOS (4 vs 3 days, P < .0001). Study group patients were also found to have significantly higher incidence and odds ratio (OR) of readmission rates (20.9% vs 16.3%; OR 1.36, P < .0001) and VTEs (1.75 vs .93; OR 1.18, P < .0001). Additionally, the study demonstrated that COPD patients incurred higher 90-day episode-of-care costs ($15,626.85 vs $14,471.29, P < .0001).ConclusionAfter adjusting for confounding variables, our study found an association between COPD and higher rates of developing VTEs following primary TKA. The study can be used by orthopedic surgeons to adequately counsel and educate these patients of the potential complications which may arise following their TKA.     

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.     

Bundled Payments for Care Improvement: Health System Experience With Lower Extremity Joint Replacement at Higher and Lower Volume Hospitals

BackgroundThe Bundled Payments for Care Improvement (BPCI) initiative was introduced in 2013 to reduce Medicare healthcare costs while preserving or enhancing quality. We examined data from a metropolitan healthcare system comprised of 1 higher volume hospital and 4 lower volume hospitals that voluntarily elected to participate in the BPCI Major Joint Replacement of the Lower Extremity Model 2, beginning July 1, 2015. Stratifying the data by hospital volume, we determined how costs changed during the 16-month period when all 5 hospitals participated compared to the 1-year period preceding BPCI participation, where savings were achieved, and how the hospitals were rewarded.MethodsThe Medicare data included the 90-day target for each episode and actual part A and part B spending for the anchor hospitalization plus all post-acute payments including inpatient rehabilitation, skilled nursing, home health, outpatient physical therapy, and hospital readmissions.ResultsThe mean episode of care cost decreased by 11.1% (from $21,324 to $18,953) at the higher volume hospitals and by 8.3% (from $25,724 to $23,584) at the lower volume hospitals during BPCI participation compared to the preceding year. The savings were achieved by reducing the use of inpatient rehabilitation, shortening the length of stay at skilled nursing facilities, and decreasing readmission rates. Although the higher volume hospital achieved an increased mean savings of $230 per episode compared to the lower volume hospitals ($2371 vs $2141), it was penalized $490 per episode after reconciling the actual Medicare expenditures with the BPCI targets while the lower volume hospitals received a mean reward of $315 per episode.ConclusionThe BPCI initiative decreased costs and readmissions within our healthcare system. Despite substantial savings compared to the preceding year, the higher volume hospital’s low target derived from its 2009-2012 baseline costs was not achieved which resulted in a penalty and led it to withdraw from the BPCI initiative in October 2016.