TKA Cost Efficiency Is Improving, But We Can Do Better

Wide variability in the cost and quality of health care in the US has led some to describe our system as “uniquely inefficient.” Consequently, we continue to study variability intensely, especially in the realm of joint arthroplasty. In the June 3, 2020 issue of The Journal, Schilling et al. elegantly analyze the variations in 90-day episode payments made by Medicare Part A for total knee arthroplasty (TKA) from 2014 to 2016. In so doing, they provide a snapshot of hospital cost performance and, just as importantly, they offer a methodology by which to measure future hospital-level cost performance with this very popular surgery.

The authors reviewed >700,000 TKAs in the Medicare population at a time prior to the full implementation of the Comprehensive Care for Joint Replacement (CJR) model, and they ranked >3,200 hospitals within 9 US regions to determine cost performance.  Schilling et al. found that during those 3 years, the mean Medicare episode payment for TKA decreased significantly, due almost entirely to a >$1,500 per-case decrease in post-acute care payments, which included lower costs for skilled nursing facilities and inpatient rehabilitation. Also decreasing during that same period were length of hospital stay and 90-day readmission rates.

These findings highlight the improvements in care and cost efficiency that were occurring even before implementation of the CJR. In a Commentary on this study, Susan Odum, PhD suggests that “the improved value of TKA illustrated by Schilling et al. includes the successful impacts of the BPCI [Bundled Payments for Care Improvement] program,” an alternative payment model that Medicare rolled out beginning in 2013.

On the other hand, the authors also reveal a persistently high degree of variability in episode payments and resource utilization both across and within geographic regions. This strongly suggests the possibility of further improvement. Regardless of which, if any, alternative payment model we participate in, everyone in the orthopaedic community should think about how to become more efficient in our delivery of musculoskeletal care. And this study provides a conceptual framework and benchmarks for identifying where the room for improvement is.

Matthew R. Schmitz, MD
JBJS Deputy Editor for Social Media

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