Cooperating for better care.

Comprehensive Care for Joint Replacement

Tag Archives

Trump’s CMS pushes back against bundled payments

knee

The CMS has delayed the expansion of a major bundled- payment pilot, Comprehensive Care for Joint Replacement, and implementation of its bundled-payment initiatives for cardiac care to Oct. 1, 2017, from July 1, according to an interim final rule posted to the Federal Register. It also again delayed the effective date of a final rule detailing the  implementation process  for CJR and other bundled-payment programs, to May 20, 2017 from March 21.

The agency is considering delaying  implementation of all bundled-payment initiatives even further, until 2018.

Modern Healthcare speculated that the Trump administration’s “move to delay these initiatives raises questions about the future of government initiatives to usher healthcare out of fee-for-service operations and into a new age of value-based payment.”

The new secretary of health and human services is Tom Price, M.D., who had a very lucrative career as an orthopedic surgeon and has been a major investor in some medical companies. CMS ultimately reports to him and President Trump.

To read more, please hit this link.


Trump’s HHS pick dislikes Medicare bundles program

hip

By RACHEL BLUTH

Kaiser Health News

A recent change in how Medicare pays for joint replacements is saving millions of dollars annually — and could save billions — without impacting patient care, a new study has found. But the man whom Donald Trump has picked to be the secretary of  the Department of Health and Human Services has vocally opposed the new mandatory payment program and is likely to revoke it.

Under the new program, Medicare effectively agrees to pay hospitals a set fee — a bundled payment — for all care related to hip- or knee-replacement surgery, from the time of the surgery until 90 days after. Traditionally hospitals collect payments for many components of care and rehabilitation individually.

Tom Price, M.D., the president elect’s HHS nominee, a congressman from Georgia and a very affluent orthopedic surgeon, has actively opposed the idea of mandating bundled payments for these orthopedic operations, calling it “experimenting with Americans’ health,” in a letter to the Medicare agency just last September. In addition, the agency which designed and implemented the experiment, the Center for Medicare and Medicaid Innovation, was created by the Affordable Care Act to devise new methods for encouraging cost-effective care. It will disappear if the act is repealed, as President-elect Trump has promised to do.

The study appeared Jan. 3 in the Journal of the American Medical Association. Though one of its authors is Ezekiel Emanuel, M.D., a professor at the University of Pennsylvania who helped design the ACA, the research relies on Medicare claims data from 2008 through mid-2015, long before the presidential election.

Starting in April 2016, CMS required around 800 hospitals in 67 cities to use the bundled payment model for joint replacements and 90 days of care after the surgery as part of the Comprehensive Care for Joint Replacement program. The program had previously been road-tested on a smaller number of hospitals on a voluntary basis, which formed the focus of the research.

The study found that hospitals saved an average of 8 percent under the program, and some saved much more. Price has been skeptical that bundled payments did save money, but the researchers estimate that if every hospital used this model, it would save Medicare $2 billion annually.

The bundled payment program works like this: For some specific kinds of medical procedures, including joint replacements or some heart surgeries, the Centers for Medicare & Medicaid Services will add up the costs for the entire episode, from the hospital stay and medical supplies to the rehabilitation afterwards. If the total costs are below a target set by CMS, the hospital gets to keep the savings. If not, the hospital has to pay Medicare the difference. It’s supposed to incentivize more efficient spending and better care coordination between providers, so they can lower costs.

In practice, it seems to be working. Baptist Health System, a network of five hospitals in San Antonio, saved an average of $5,577 on each joint replacement without sacrificing the quality of care, according to the study. Baptist was an early adopter of bundled payments; it began experimenting with them in 2008. Over seven years, the hospital system has cut Medicare’s costs on knee replacements by almost 21 percent.

The savings came without impacting quality. Patients at Baptist Health System were just as likely to be readmitted to the hospital or end up in the emergency room as patients nationally. There was some indication that quality of care may be better, fewer patients under bundled payments had long, extended hospital stays.

In Price’s letter from September, he said that Medicare had exceeded its powers in imposing such bundled payments, which he said took decisions out of the hands of doctors and patients.

That doesn’t seem to be the case, according to Amol Navathe, M.D., an assistant professor of medicine and health policy at the University of Pennsylvania, and one of the authors of the JAMA study. Instead, Navathe and his colleagues suggest that the bundled payments actually fostered greater collaboration between surgeons, administrators and patients because programs could only succeed in saving money if physicians were engaged in creating standardized pathways for care.

For example, the Baptist Health System saved about 30 percent on implant costs, around $2,000 on each artificial joint, by using the least expensive medically equivalent implants as determined by the hospitals’ surgeons.

Usually, physicians are prevented from benefitting when hospitals save money because of anti-kickback laws. Waivers under bundled-payment models mean that surgeons can put in the time to find the best, most cost-effective implants, and share in some of that savings.

“It takes that extra level of effort and coordination, and proactively communicate with [patients],” Navathe said. “Preplanning, setting of expectations and communicating up-front is resource intensive, when they have the incentive to do that they were willing to expend the extra resources to make that happen.”

When bundles included care after a patient’s hospital stay, spending on rehabilitation went down 54 percent. That’s because hospitals took the time to match patients to the right level of care, Navathe said.

Patients who didn’t need to stay in a nursing home or rehab center were set up with home health care or physical therapy.

Price has objected to CMS making bundled payments mandatory, calling it an instance of federal overreach. But bundled payments only work if everyone has to participate, according to Darshak Sanghavi, M.D., the former director of prevention and population health at the Center for Medicare and Medicaid Innovation.

If hospitals can choose whether or not to participate, only the ones that are already delivering care efficiently –and coming in under CMS’s cost target — will use bundles and Medicare will constantly be paying out bonuses. The system needs to be mandatory, Sanghavi said, to pull in less efficient hospitals and give them incentive to change.

“Stopping the programs for ideological reasons I think impedes innovation in a way that is going to consign us to having really, really high costs of care that’s going to continue in the future,” Sanghavi said.

Bundled payments aren’t just for hip and knee replacements. On Dec. 20, CMS announced it would expand mandatory bundled payments to treatments for heart attacks, bypass surgery and cardiac rehab beginning in July 2017. In its waning days, the Obama administration is effectively throwing down the gauntlet to the incoming administration on bundled payments, one of its signature reforms.


10 things about CMS bundled-payment rule

 

Becker’s Hospital Review has done a handy 10 things to know about CMS’s final rule on a mandatory bundled-payment program for coronary-artery-bypass surgery and its expansion of the existing Comprehensive Care for Joint Replacement program. To read whole article, please hit this link.

Here they are, stripped down:

1. “Under the final rule, acute care hospitals in certain markets will be accountable for the cost and quality of care provided to heart attack, coronary bypass and surgical hip and femur fracture patients beginning with hospitalization and extending 90 days after discharge.”

2. “The rule expands the existing CJR model to include additional surgical treatments for hip and femur fractures….”

3. “Hospitals will receive retrospective episode-based payments under the new bundles. Hospitals that spend less than the target price for the episode of care while meeting or exceeding quality standards keep the savings achieved. A hospital is required to repay Medicare if the costs exceed the target price.”

4. “The final rule includes a cardiac rehabilitation payment model, which will test whether a payment incentive can increase the utilization of cardiac rehabilitative services….”

5. ”The heart attack and coronary bypass bundled payment model will be mandatory for hospitals in 98 metropolitan statistical areas….”

6. ”About 860 hospitals will participate in the hip- and femur- fracture bundles, which will be tested in the 67 MSAs already selected for the CJR model.”

7. ”The cardiac rehabilitation payment model will be implemented in 90 MSAs, 45 of which were not selected for the heart attack and coronary bypass models….”

8. ”The cardiac bundles and the expanded CJR model qualify as Advanced Alternative Payment Models under the Medicare Access and CHIP Reauthorization Act and the Quality Payment Program.”

9. ”The American Hospital Association said it was pleased with some parts of the final rule, including the flexibility the rule provides regarding MACRA participation. However, the AHA expressed concern about the pace of change. ‘The bundled payment model for cardiac care is the second mandatory demonstration project the agency has finalized in just the past 15 months,’ said the AHA. ‘This is too much, too soon.”‘

10. The bundles will begin July 1, 2017.


Outpatient joint replacements pose big threat to hospitals

hipreplace

In the past, people getting total hop or knee replacements have usually been operated on in a hospital inpatient surgical unit, then they remain a few days in the hospital and finally they are are moved to a skilled-nursing or rehab facility or get home health care.

“{T}hat’s starting to change, and tensions are rising between hospitals and orthopedic surgeons as a result. Building on advances in surgical technique, anesthesia and pain control, a small but growing number of surgeons around the country are moving more of their total joint replacement procedures out of the hospital, performing these lucrative operations in outpatient facilities. Some are sending their patients home within a few hours, while others have their patients recover overnight in the surgery center or hospital during 23-hour stays. These surgeons say very few of their patients require skilled nursing, rehab or home healthcare. ”

The publication then  states what might be obvious:

“Moving these procedures to outpatient settings poses a major threat to hospital finances, since total joint replacements are one of the largest and most profitable service lines at many hospitals….The financial threat will be even greater if the CMS changes its rules and allows Medicare and Medicaid payment for these outpatient procedures, which observers expect will happen in the next few years.”
“The migration of total joint replacements to outpatient settings also raises questions about the future of Medicare’s mandatory bundled-payment initiative for inpatient procedures in 67 markets around the country, called the Comprehensive Care for Joint Replacement program, which began in April. If the CMS decides to pay for ambulatory procedures, that could undercut the hospital bundling initiative.”

 

MH TAKEAWAYSThe migration of lucrative joint-replacement surgeries to outpatient settings will cause friction between surgeons and hospitals and raises questions about the premise of Medicare’s new bundled-payment initiative for hospital-based procedures.

Critics ask, so what? “Why would we not encourage the migration to outpatient if the outcome is the same and the cost is lower?” said Jeff Goldsmith, a national adviser to Navigant Healthcare. Goldsmith, a Medicare beneficiary, recently underwent a hip replacement and recovered so quickly he thinks it could have been done on an outpatient basis. “Why preserve the (inpatient bundling) program if the whole point is to save money for Medicare?” he said.

Until recently, outpatient total joint replacements were rare. Most providers and patients thought a several-day hospital stay was needed because of the pain, mobility and infection risks associated with these major surgeries. Now, when patients’ health plans allow it, leading surgeons in this field say they are doing many or most of their joint replacements on an outpatient basis—except for patients who are extremely obese or have unstable chronic conditions. They say even healthy patients in their 70s or 80s can be candidates for outpatient surgery, but careful patient selection is essential.

Many more surgeons are eager to learn these improved clinical processes and start doing joint replacements outside the hospital. “Dr. Hoffman has surgeons and administrators from all over the country come tour and watch our processes two or three times a month,” said Michael Patterson, CEO of the Mississippi Valley Surgery Center, who recommends slow, careful adoption of outpatient procedures. “We advise surgeons that first they need to be able to get patients in and out of the hospital within 24 hours. They can’t go straight from three- to five-day stays to 23 hours.”

The emerging outpatient delivery model is driven by both patients’ and payers’ desire to reduce their costs, increase convenience and satisfaction and diminish the risk of hospital-acquired infections. Orthopedic surgeons say doing joint replacements on an outpatient basis cuts costs nearly in half, although reimbursement is also lower. “People want quality at a reduced cost,” said Dr. Patrick Toy, who has done nearly 250 hip and knee replacements at the outpatient Campbell Clinic in Memphis, Tenn., which he partially owns. “This hits the nail on the head.”

Despite the looming financial threat, many hospitals have not settled on a strategy to address the outpatient migration, particularly where local surgeons have not yet adopted this new practice pattern. In some markets, hospitals and surgeons are starting to collaborate, while in others there may be conflict over who will capture the big dollars from joint replacements, which are surging as the baby boomers move into their creakier years.

“This is coming whether we like it or not, and we have to figure out how to better partner with physician practices to deliver the best care for patients and hopefully protect patient volume for the hospital,” said Kyle Armstrong, CEO of Baptist Memorial Hospital-Collierville, a suburb of Memphis served by Toy’s free-standing surgery center. “I can imagine there will be some areas where it is contentious.” His system has considered buying or partnering in a Memphis outpatient surgery center.

In 2014, 23% of 354 hospitals surveyed by the Advisory Board Co. performed at least some outpatient knee replacements, while 7% performed at least some outpatient hip replacements. Experts say those numbers likely have increased in the past two years as more surgeons and their teams gain confidence with new and improved clinical protocols, making it possible to release patients more quickly.

“More hospitals are starting to move joint replacement into outpatient settings to compete with (free-standing) ambulatory surgery centers,” said Shruti Tiwari, a senior consultant at the Advisory Board. “Patients are warming up to the idea, particularly younger and healthier patients who don’t have time for a three-day hospital stay and a protracted recovery process.”

“The smart, strategic hospital management teams understand they need to get ahead of this, so that when volume shifts out of their buildings they won’t lose patients,” said Brian Tanquilut, a senior healthcare analyst at Jefferies & Co. “That’s why the investor-owned hospital companies are making a big push on surgery centers.”

Even at hospitals that are already collaborating with their surgeons on outpatient joint replacements, executives caution that there are problems making outpatient joint replacements financially viable.

“The current ambulatory reimbursement system isn’t really sufficient to cover the overall cost of care,” said Michael Dandorph, chief operating officer at Rush University Medical Center in Chicago. He projects that up to 25% of joint replacements may be done on an outpatient basis within five years if Medicare starts paying for them. “On a single-case basis, we’re taking a revenue hit. But if it produces better outcomes and lowers the cost, that should attract more patients,” he said.

Orthopedic surgeons say that while they would like to collaborate with hospitals on outpatient joint replacements, institutional inertia makes it hard to implement innovative practices that better serve patients.

Dr. Richard Berger performs nearly 800 outpatient total joint replacement procedures a year, split between Rush University Medical Center’s ambulatory surgery unit and the Munster (Ind.) Specialty Surgery Center, a free-standing facility he partially owns. “Even at Rush, which is a great hospital, it’s hard to make changes and try new things,” he said. “At the surgery center, I make one phone call and anything I want to do, I can do.”

“You can control costs so much better in the ambulatory surgery center setting,” said Dr. Alexandra Page, who chairs the American Academy of Orthopaedic Surgeons’ Health Care Systems Committee and whose practice partner has started doing joint replacements in a free-standing outpatient center in San Diego. “That works for everyone but the hospital.”

Some hospitals, such as Rush and CentraCare Health’s St. Cloud (Minn.) Hospital, are responding by working with surgeons to do same-day or

23-hour joint replacement procedures either in hospital-run surgical units or outpatient centers, depending on each patient’s needs. Dr. Joseph Nessler and his colleagues at St. Cloud Orthopedics, a 21-physician independent practice group, are doing more than 300 total joint replacements a year on an outpatient basis, divided between the physician-owned St. Cloud Surgical Center and the hospital. The chosen surgical setting is based on each patient’s medical condition and whether an overnight stay is needed


Warning to hospitals on CMS joint-replacement rules

 

hip

A new analysis by Avalere Health discussed in MedPage Today warns that most hospitals involved in Medicare’s new hip- and knee-replacement model would suffer financial penalties if they failed to cut care costs.
“Historically, hospitals focused on what’s happening within the four walls of their institution,” said Josh Seidman of Avalere Health, but much of patients’ costs occur after a procedure is completed and the Centers for Medicare & Medicaid Services (CMS) recognizes this.

In July, 2015, CMS announced the Comprehensive Care for Joint Replacement (CJR) model, which orders 800 hospitals in 67 metropolitan areas to bundle payments for joint replacements in the lower extremities over a 90-day “episode of care.” Avalere estimates that 60 percent of hospitals would face penalties under the new model. The new rule is a “wake up call” for hospitals who had adopted a wait-and-see approach to payment reform, Seidman  said.
Unlike past demonstrations, which were voluntary, hospitals in these randomly chosen regions must adhere to the new program and its rules.

Using  the CMS Public Use File, Mr. Seidman compared hospitals’ current costs across the full spectrum of care and projected where hospitals would rank using the benchmarks set by the new rule.

MedPage reported that “Some hospitals have prepared for changes in payment by developing new or deeper relationships with post-acute care providers, by focusing on both patient and information flow across the care continuum and by creating new ways to improve care management, Seidman noted.”


Contact Info

info@cmg625.com

(617) 230-4965

Wellesley, Mass