Could Bundled Payments Work with Cervical Fusion?

ACDF_Reimbursement_VariationThe answer to that question depends largely on how much the 90-day episode of care actually costs. Virk et al., in the August 17, 2016 edition of JBJS, provide benchmark data that could help policymakers design bundled payments for cervical fusions that are economically viable for providers.

The authors analyzed the Medicare 5% National Sample Administrative Database and found that 4,506 patients in that cohort underwent a one to two-level anterior cervical discectomy and fusion (ACDF) for cervical radiculopathy from 2005 to 2012. The mean cost per patient of the procedure plus the 90-day postoperative period was $15,417. The physician reimbursement represented 20.4% of that total, with the surgeon receiving 18% of the total. Reimbursements for hospitals for inpatient care represented nearly 73% of the total reimbursement. The study did not account for reimbursements from “Medigap” plans or private payers.

The authors also analyzed data from the same database for 90-day episodes of care related to total knee arthroplasty (TKA). The mean per-patient reimbursement for TKA patients was $17,451. The authors noted significant regional variation in reimbursement for ACDF, with the lowest rates in the Northeast and Midwest and the highest rates in the West.

Among the conclusions made by Virk et al. is the following: “Although payments to physicians have been implicated in the rise of health-care costs, the data suggest that the greater opportunity for reducing expenses involves hospital-related reimbursement.”

Click here for more OrthoBuzz coverage of bundled payments in orthopaedics.

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