Search results for bundled payment

Medicare to “Unbundle” Postoperative Care by 2018

During a well-attended symposium on bundled payment initiatives for joint replacement at the 2015 AAOS Annual Meeting, speakers shared enlightening pearls and pitfalls related to Medicare’s Bundled Payments for Care Improvement initiative. But no one mentioned the fact that by 2018, Medicare will shift the 90-day global period for joint replacement—and all other covered surgeries—to a 0-day global period.

This fact is discussed in an eye-opening Perspective by Mulcahey et al. in the April 9 New England Journal of Medicine. Noting that bundled payments in general are designed to improve care and reduce cost, the authors call this decision, which would essentially unbundle postoperative visits, “striking.” The shift to a 0-day global period for surgery is based on an HHS Inspector General audit that found that the number of postoperative encounters between surgeons and patients are actually well below the number paid for in the 90-day bundle. Total knee arthroplasty, for example, includes three inpatient, one hospital-discharge, and three outpatient surgeon visits in its 90-day package.

Mulcahey et al. contend that “removing some or all postoperative visits from global packages will reduce procedure payment rates” for surgeons, but it remains to be seen how surgeons, orthopaedic and otherwise, will respond to the policy change. OrthoBuzz will keep you posted.

A Conversation with Dr. Brian Parsley, President of AAHKS

Dr. Brian S. Parsley is President of the American Association of Hip and Knee Surgeons (AAHKS). He was kind enough to answer a few questions for OrthoBuzz.

JBJS: What have been your key goals for AAHKS during your presidency?

Dr. Parsley: AAHKS is a growing organization that has established itself as the premier organization for hip and knee arthroplasty education, advocacy, and support in the United States. Our membership has experienced continued record growth, as has our Annual Meeting. This year will focus on continuing our growth nationally, but we will also focus more on developing international membership and partnerships through educational opportunities. We are blessed with outstanding experts in arthroplasty techniques and innovation, in patient advocacy and legislative and regulatory affairs, and with expertise on how to navigate through this ever-changing healthcare arena to ensure that the patients we serve are well cared for. This requires a constant review and upgrade of our internal organizational systems to manage these priorities effectively and efficiently.

JBJS: How do you think JBJS can best address the needs of the members of AAHKS and other subspecialty organizations?

Dr. Parsley: JBJS continues to be one of the premier resources for quality educational content and serves as a foundation for identifying “Best Practices” recommendations. The expansion of JBJS into alternative methods to communicate with the orthopaedic community through forums such as this and educational webinars indicates an interest in remaining a respected resource.

JBJS: As a specialist in diagnosing and treating arthritis, are there new or emerging approaches to treatment that you see as particularly promising?

Dr. Parsley: The success of total joint arthroplasty today is outstanding, and the quality-of-life improvement this procedure provides is life changing for the vast majority of patients. We continue to focus on new techniques for joint preservation through cartilage research and exploring when early intervention to treat hip or knee abnormalities is indicated to improve function and extend joint preservation. I also see the continued emergence of bicruciate-retaining TKA to potentially provide knee replacements that have a more anatomic stabilization and function and hopefully improved outcomes. Continued refinement of the mechanical functions of the joint implants for both the hip and knee are ongoing; this includes further improvements of the polyethylene articulation, improvements in trunion design for modular hip designs, and improvements in implant geometry that will hopefully extend the life of implants even further.

JBJS: What trends in orthopaedics generally are you most intrigued by?

Dr. Parsley: The delivery of orthopaedic care is undergoing major changes as the fee-for-service model is being challenged and value propositions introduced. This is the most disruptive change in orthopaedics today. The associated changes in the physician practice from the private-sector model to a significant rise in physician employment will potentially have an impact on the patient-physician relationship and our role as patient advocate, and this is a cause for concern. Physicians need to get engaged and lead the way during this time of change.

JBJS: Looking ahead to the next 20 years or so, what do you think might be three significant advances or changes in orthopaedics?

Dr. Parsley: As I mentioned above, the changes in healthcare delivery will be the most significant, but at the same time they will provide opportunities for improvement in the value of the services we provide. Extensive work is being done in the field of orthobiologics and the potential benefits of stem cell research. This field may help us prevent or delay the devastating effects of arthritis. Lastly, the emphasis today on evidence-based medicine will help us refine the care that we provide and decrease the variability of outcomes going forward. This is in the best interest of our patients.

JBJS: What changes do you expect to come as a result of the Affordable Care Act (ACA)?

Dr. Parsley: Continuing on the current path is unsustainable. The passage of the Affordable Care Act has changed the face of medicine and will pose many challenges in the years ahead. The fact is that this is the new law of the land, and the sooner we accept that fact and move forward the better. Still, there is no question the ACA can be modified and improved upon. There are tremendous opportunities for orthopaedics to refocus and take the lead on the management of musculoskeletal care for our patients, and not just as a surgical event within an episode of care. We have not only the surgical skill sets, but we also have the ability to manage the entire episode of care–and we should. There is no one who knows and understands the needs of the patient with an orthopaedic problem better than we do and what care the patient needs. I am very concerned that patients will suffer if the orthopaedic surgeon does not step up and take the lead in this changing healthcare delivery system. We need to maintain the patient–physician relationship and continue to be the patient’s advocate. The most successful early programs since passage of the ACA have all been physician-driven.

In the field of arthroplasty, the evolution of bundled payments is coming and in my opinion, bundled payments will soon be the rule rather than the exception. There is great potential to provide excellent care to patients more effectively and efficiently at a lower cost, resulting in higher value to the patient and the healthcare system. But that requires the physician to be actively engaged in the process.

JBJS: You have participated in several service-oriented activities, including the Houston Haitian Recovery Initiative. How has participating in these activities enriched your medical practice?

Dr. Parsley: I have always felt that the Good Lord gives us all gifts; it is what you do with those gifts that makes a difference. I am blessed to be an orthopaedic surgeon, and I feel that I am doing what was meant to be. Sharing these gifts with others by serving those in need through medical mission work in Guatemala, Haiti, Ecuador, or even in Houston–whether it be with surgical skills, with leadership and volunteer recruitment, or with philanthropy–is life-changing for all involved. I have made more than 45 medical mission trips in the past 18 years, the majority to Guatemala with Faith In Practice. The first of 4 trips I made to Haiti was 6 days following the devastating earthquake several years ago. I am humbled by the patients we treat and the faith that they show in a total stranger such as me. These missions reinvigorate my soul and reinforce the reasons that I went into medicine in the first place. The sanctity of the patient-physician relationship is communicated through the touch of the hand, the smile on their faces, the hugs of gratitude, and the incredible faith they share with you. Everyone should give back in some way as part of this wonderful profession.

JBJS: What is your favorite thing about your profession?

Dr. Parsley: I am truly blessed to be an orthopaedic surgeon and am surrounded by highly motivated and talented people with a can-do attitude and a focus on quality care. The camaraderie, respect, and friendships that develop in the orthopaedic family as we continue to strive to be the best we can be on behalf of the patients we serve is always a motivation and a pleasure.

Good Outcomes and Savings with Preferred-Vendor Program

It has been said that outcomes of total joint arthroplasty are 90% related to surgeon factors (such as prosthetic alignment and fit and soft-tissue management), and only 10% to the implant itself. Historically, surgeon choices of implants for primary total hip and total knee arthroplasty have been based on influences such as the prostheses used during training, prior vendor relationships, specific patient characteristics, and findings in published literature. Absent evidence that the selection of prosthesis vendor affects patient outcomes to any significant degree, and with the universal focus on lowering health care costs, surgeon implant/vendor preferences have come under close scrutiny.

In the August 7, 2019 issue of The Journal, Boylan et al. study the impact of a voluntary preferred single-vendor program at a large, high-volume, urban orthopaedic hospital with >40 (mostly hospital-employed) arthroplasty surgeons. The hospital’s use of hip and knee arthroplasty implants from the preferred vendor rose from 50% to 69% during the program’s first year. In addition, the mean cost per case of cases in which implants from the preferred vendor were used were 23% lower than the mean cost-per-case numbers from the previous year (p<0.001). Boylan et al. noted that low-volume surgeons adopted the initiative at a higher rate than high-volume surgeons, and that surgeons were more compliant with using the preferred vendor for total knee implants than for total hip implants.

Why is it that some higher-volume surgeons seem resistant to change? It is not clear from the data presented in this study whether the answer is familiarity with an instrument system, loyalty to local representatives, or relationships with manufacturers based on financial or personal connections. The authors observed that “collaboration between surgeons and administrators” was a critical success factor in their program, and interestingly, the 3 highest-volume surgeons in this study (who performed an average of ≥20 qualifying cases per month) all used total knee implants from the preferred vendor prior to the initiation of this program.

The provocative findings from this and similar studies lead to many questions ripe for further research. Because hospitals are highly motivated to reduce implant costs in the bundled-payment environment, preferred-vendor programs are gathering steam. We need to better understand how they work (or don’t) for specific surgeons, within surgical departments, and within hospital/insurance systems in order to evaluate their effects on patient outcomes and maximize any cost benefits.

Marc Swiontkowski, MD
JBJS Editor-in-Chief

Guest Post: Get Ready for Medicare’s CJR Model

OrthoBuzz occasionally receives posts from guest bloggers. This “guest post” comes from Richard S. Yoon, MD and Alexander McLawhorn, MD, MBA.

Starting on April 1, 2016, Medicare will implement its Comprehensive Care for Joint Replacement (CJR) model in about 800 hospitals in 67 metropolitan areas around the United States. Finalized in November 2015, the CJR initiative is intended to enhance value for patients undergoing lower extremity joint replacement (LEJR) by motivating institutions to achieve quality improvement via cost control. (For a complete discussion of “value” in orthopaedics, see “Measuring Value in Orthopaedic Surgery” in JBJS Reviews.)

Medicare hopes CJR will promote standardized, coordinated care that takes each LEJR patient seamlessly through an “episode of care” that maximizes outcomes at a reduced cost.  Episodes are triggered by hospital admission and are limited to admissions resulting in a discharge paid under MS-DRG 469 or 470. For CJR purposes, episodes last for 90 days following discharge.

Initially, episode target prices will be based on historical hospital-specific reimbursements, but over time, the target prices will increasingly reflect regional averages. If a hospital’s average LEJR episode cost is below the target price, it can receive a “bonus” from CMS. If its average cost is above the target price, it will owe CMS the difference. CMS has designed a gradual rollout plan to mitigate downside risk in the first year and provide current and future participants adequate time to implement evidence-based, cost-effective care and other quality programs in their institutions.

Richard Iorio, MD, chief of adult reconstruction at NYU-Langone Medical Center’s Department of Orthopaedic Surgery, says, “There will be definite winners and losers in CJR. Once geographic pricing becomes the dominant metric for target prices, there will be intense price competition in geographic areas and potential access problems for high risk patients.” At the moment, CJR stratifies risk based only on MS-DRG code and whether a patient has a hip fracture. Unless a more robust risk stratification method is implemented, “cherry-picking” patients may become a significant issue. (See related OrthoBuzz post “Tool for Pre-TJA Risk Stratification.”)

If you are an orthopaedic surgeon who performs LEJR, ask your department head or health system about CJR, because strategies that minimize cost and maximize quality may vary from hospital to hospital. Alignment of hospitals and surgeons is probably the most critical success factor  with CJR. To that end, gainsharing— a key component of well-functioning hospital-surgeon partnerships within any bundled-payment environment —for individual orthopaedic surgeons is specifically allowed within the CJR final rule.

Click here for more information, including FAQs and a list of participating areas.

Richard S Yoon, MD is executive chief resident at the NYU Hospital for Joint Diseases.

Alexander McLawhorn, MD, MBA is an arthroplasty fellow at the Hospital for Special Surgery.


How Far Will Patients Travel for Free Joint Replacements?

Workers with health insurance coverage through several large employers including Walmart and Lowes now have the option of getting a joint replacement free of charge. Through the Employers Centers of Excellence Network established by the Pacific Business Group on Health (PBGH), four providers—Johns Hopkins Bayview Medical Center (Baltimore), Virginia Mason (Seattle), Kaiser Permanente Orange County (Irvine, CA), and Mercy Hospital (Springfield, MO)—negotiated bundled-payment agreements based on their high volumes, better-than-average outcomes, and lower-than-average complication rates. Instead of paying the usual deductibles and copays, patients travel to one of these four providers and don’t pay a penny for the procedure or travel expenses. The non-profit PBGH has 60 large-company members that provide health care coverage to 10 million people, including active employees, retirees, and dependents.