Commentary

Orthopedics in the Age of Accountable Care Organizations and Population Health: From Profit-Center to Cost-Center

Publish date: September 12, 2018

References

1. Carter Clement R, Bhat SB, Clement ME, Krieg JC. Medicare reimbursement and orthopedic surgery: past, present, and future. Curr Rev Musculoskelet Med. 2017;10(2):224-232. doi:10.1007/s12178-017-9406-7.

2. Centers for Medicare & Medicaid Services. Acute Inpatient PPS. https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/index.html. Published August 2, 2017. Accessed September 8, 2018.

3. Centers for Medicare & Medicaid Services. Draft ICD-10-CM/PCS MS-DRGv28 Definitions Manual. https://www.cms.gov/icd10manual/fullcode_cms/P0185.html. Accessed September 8, 2018.

4. Centers for Medicare & Medicaid Services. Comprehensive Care for Joint Replacement Model. https://innovation.cms.gov/initiatives/cjr. Accessed September 8, 2018.

5. Volpp KG, Bundorf MK. Consumer protection and the HMO backlash: are HMOs to blame for drive-through deliveries? Inquiry. 1999;36(1):101-109.

6. Centers for Medicare & Medicaid Services. Quality Measures and Performance Standards. https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/Quality_Measures_Standards.html. Published March 2, 2015. Accessed November 3, 2015.

7. Centers for Medicare & Medicaid Services. Accountable Care Organizations (ACOs): General Information. https://innovation.cms.gov/initiatives/aco/. Accessed September 8, 2018.

8. Centers for Medicare & Medicaid Services. Next Generation ACO Model. https://innovation.cms.gov/initiatives/Next-Generation-ACO-Model/. Accessed September 8, 2018.

9. Centers for Medicare & Medicaid Services. Next Generation Accountable Care Organization (ACO) Model: Frequently Asked Questions. https://innovation.cms.gov/Files/x/nextgenacofaq.pdf. Accessed September 8, 2018.

10. Centers for Medicare & Medicaid Services. Quality Measure Benchmarks for the 2018 and 2019 Reporting Years. https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/Downloads/2018-and-2019-quality-benchmarks-guidance.pdf. Published December 2017. Accessed September 8, 2018.

11. Toussaint J, Krueger D, Shortell SM, Milstein A, Cutler DM. ACO model should encourage efficient care delivery. Healthc (Amst). 2015;3(3):150-152. doi:10.1016/j.hjdsi.2015.06.003.

12. Clement RC, Kheir MM, Derman PB, et al. What are the economic consequences of unplanned readmissions after TKA? Clin Orthop Relat Res. 2014;472(10):3134-3141. doi:10.1007/s11999-014-3795-3.

13. Centers for Medicare & Medicaid Services. Physician Fee Schedule Search Results. http://www.cms.gov/apps/physician-fee-schedule/search/search-results.aspx?Y=0&T=0&HT=0&CT=0&H1=27447&M=1. Accessed June 4, 2015.

14. Losina E, Walensky RP, Kessler CL, et al. Cost-effectiveness of total knee arthroplasty in the United States: patient risk and hospital volume. Arch Intern Med. 2009;169(12):1113-1121; discussion 1121-1122. doi:10.1001/archinternmed.2009.136.

15. Mather RC 3rd, Hug KT, Orlando LA, et al. Economic evaluation of access to musculoskeletal care: the case of waiting for total knee arthroplasty. BMC Musculoskelet Disord. 2014;15:22. doi:10.1186/1471-2474-15-22.

16. International Consortium for Health Outcomes Measurement. ICHOM web site. https://www.ichom.org/. Accessed November 3, 2015.

17. Rolfson O, Wissig S, van Maasakkers L, et al. Defining an international standard set of outcome measures for patients with hip or knee osteoarthritis: consensus of the International Consortium for Health Outcomes Measurement Hip and Knee Osteoarthritis Working Group. Arthritis Care Res (Hoboken). 2016;68(11):1631-1639. doi:10.1002/acr.22868.

18. Clement RC, Welander A, Stowell C, et al. A proposed set of metrics for standardized outcome reporting in the management of low back pain. Acta Orthop. 2015;86(5):523-533. doi:10.3109/17453674.2015.1036696.

19. Shortell SM, Colla CH, Lewis VA, Fisher E, Kessell E, Ramsay P. Accountable care organizations: the national landscape. J Health Polit Policy Law. 2015;40(4):647-668. doi:10.1215/03616878-3149976.

20. Centers for Medicare & Medicaid Services. CMS Proposes “Pathways to Success,” an Overhaul of Medicare’s ACO Program https://www.cms.gov/newsroom/press-releases/cms-proposes-pathways-success-overhaul-medicares-aco-program. Published August 9, 2018. Accessed September 10, 2018.

CMS must establish adequate quality assurance measures to ensure that ACOs do not withhold cost-effective care, like TKAs,^14,15 from their patients. Hopefully, for both professional and ethical reasons, providers will be active partners in this process. Groups like the International Consortium for Health Outcome Measurement, which has convened international expert panels to agree on comprehensive outcome sets for total joint arthroplasty and the management of low back pain, among other non-orthopedic conditions, may be useful examples in this process.^16-18

At the provider level, surgeons will be more likely to be salaried employees, contracting directly with the ACO rather than primarily working to earn physician fees from insurance providers. Surgeons will likely be judged (and rewarded financially) on their ability to direct nonoperative care, to find non-surgical solutions to problems that may currently be treated operatively, and to reduce costs for patients that require surgery. Additionally, with an increased focus on quality assurance, there will likely be more pressure from ACOs and CMS to demonstrate results of both operative and nonoperative care, likely in the forms of patient-reported metrics and objective measures of physical function. Surgeons will have a strong incentive to be leaders in the process of collecting such data.

It is also worth considering the position of orthopedic practices that are not part of an ACO. Some ACOs will not have the capacity to provide all (or possibly any) of the orthopedic care their patients require. When necessary, they will contract with outside orthopedic practices. Compared with CMS, ACOs are much smaller purchasers and can be expected to be more sensitive to price, likely negotiating intensely between local orthopedic providers. As a result, even orthopedists outside of ACOs may feel the cost pressure created by this new reimbursement model and may be driven to implement cost-reduction measures such as standardized implant choices and discharge pathways.

ACOs are in an active growth phase,^19,20 and recent updates to ACO policies make it clear that CMS intends for this trend to continue.⁸ Since ACOs are still a nascent reimbursement model, orthopedists will still do better financially, in almost all markets, by continuing to expend their energy and resources pursuing revenue, rather than cutting costs or demonstrating outcomes. However, as ACOs and population health gain traction, those orthopedists who recognize this shift and plan accordingly will have a definite strategic advantage, whether their practice is within an ACO, interacting with external ACOs, or both.