Financial Implications of Health-Care Reform on Orthopaedics
Health-care expenditures in the United States are higher than and rising at a rate greater than that of any other developed country in the world. Using the current growth rate and future estimates, by 2020, 20% of our gross domestic product will be spent on health care, and 20% of that (or 4% of the gross domestic product) will be spent on musculoskeletal care1.
Partially in response to these unsustainable expenditures, the Patient Protection and Affordable Care Act (PPACA) was passed into law in 2010. This law, the provisions of which are currently being phased in, was adopted in an attempt to insure more individuals, slow growth of health-care costs, and reward innovation in health-care provision. Most orthopaedic care in the U.S. is rendered to adults, and particularly to older adults. The most expensive Centers for Medicare & Medicaid Services (CMS)-sanctioned diagnosis-related group (DRG) is total joint arthroplasty, and hip fracture care is the third most expensive DRG2.
The CMS is changing the reimbursement focus from volume of care to “value of care.” The equation being used to calculate value is “value = outcomes/cost.”3 The surrogate for “outcomes” is process (quality) measures, which are obtained from hospital or claims data. Patient-reported outcomes are not presently available to consider in this equation. Cost data are readily available to the CMS at the hospital and provider level.
An understanding of the concept of “value” in orthopaedic care is imperative for orthopaedic surgeons. Creating high-value care will be essential for our health systems and will certainly be tied to referrals and contracts. Registry data may be 1 way to record and improve the quality of orthopaedic outcomes. Through the PPACA, the CMS has dictated that 85% of hospital payments will be made through an alternative payment mechanism by the end of 2016. By 2018, 50% of that care must be delivered in a mechanism other than fee-for-service, and a full 90% will be linked to some quality measures4.
Alternative Payment Mechanisms
Fee-for-service, the current reimbursement model, will soon be replaced by fee-for-service with a quality link. Adverse events (i.e., readmissions, infections, or reoperations) will influence reimbursement. Therefore, caring for patients with substantial comorbidities could become challenging unless we establish, perhaps through registry data, patient-level risk stratification.
A bundled payment is 1 global fee for a defined period of time. The bundle usually begins when the surgery is commenced and ends 30, 60, or 90 days later. Everything, including surgical care, physician fees, hospital services, rehabilitation services, home health services, and outpatient physical therapy, that occurs during that time period is covered in the bundle. Any complications or readmissions must also be paid from that 1 bundled sum. This payment model aligns incentives among the hospital, the physician, and the payer, but not the patient.
The CMS bundled payment pilots have focused on hip fracture and total joint arthroplasty. One key to success is the reexamination of the care process from beginning to end, especially in the post-acute-care realm. The actual cost for each phase of care, as well as outcomes data, must be known so that patient quality of care may be optimized. A care coordinator and a financial administrator are essential team members of a bundled payment program. “Uncontrolled variation is the enemy of quality” is an important guiding mantra, as stated by W. Edwards Deming5.
One confounding issue that must be addressed in a CMS arthroplasty bundle is the 13% to 14% of patients who are admitted with a hip fracture and are treated with arthroplasty. These patients are included in the total joint DRGs 469 and 470. For the cost differential, the nonfracture costs averaged $23,972, whereas hip fracture costs averaged $43,677 (82% higher). The hip fracture cases that are included in the total joint bundle must be managed differently; these are the cases that cost the most. Figure 1 illustrates 1 year of single-center patient-cost data for total joint care, including hip fracture patients.
Successful bundling requires a care redesign of the patient pathway, including post-acute care at a skilled nursing facility and home health care. Communication with nursing home personnel and post-acute-care providers is difficult because of the frequent incompatibility of the charting systems. While a nursing home’s financial incentive is to keep the patient for 20 days because care is 100% covered by the CMS, a bundled care program would eliminate or shorten nursing home stays. When designing a bundled care program, the team must examine all aspects of care and align incentives for care providers, with gainsharing as needed. Mobile Outreach, described below, is 1 program that could be of benefit in this new era of bundled payments.
A final challenge to be considered in hip fracture care bundling could be the risk stratification of patients with extremely disparate comorbidities. Although investigators such as Mears et al. have described successful hip fracture care pathway bundles without risk stratification6, it will remain to be seen if this model can be universally adopted for a population of patients with hip fracture in whom independence, cognitive status, and comorbidities are so variable.
The accountable care organization (ACO) model of care was designed for primary care physicians to manage medical issues such as diabetes and hypertension, and to encourage wellness for a population of patients. In an ACO, patients are covered by 1 payment per year to manage their health. Therefore, there is an incentive to avoid surgery, which is viewed as a costly intervention. However, patients may still require musculoskeletal care in the form of arthroplasty or fracture care, for example. In light of this, surgeons may be paid by fee-for-service in an ACO.
Although not designed for surgical practices, the emphasis on wellness that is required by ACOs is a focus that can be adopted by orthopaedists. For example, in addition to counseling patients about smoking cessation, fall prevention, and weight loss, the American Orthopaedic Association (AOA) has created the Own the Bone (OTB) program (described below) for the promotion of bone health and the reduction of fracture occurrence. Fragility fractures affect more patients than stroke, heart attack, and breast cancer combined (Fig. 2). Dual x-ray absorptiometry (DXA) screening is far less common than usual screenings like mammograms and Pap smears. Even when patients are seen for a fragility fracture, most orthopaedic surgeons do not assess their bone quality. OTB offers an opportunity for the prevention of additional fractures, thus creating real value in an ACO care model.
In summary, there will be many changes to health-care provision and payment over the next few years, the driving force of which is cost reduction “to bend the cost curve” and a shift from incentivized care volume to incentivized care value. Bundled payments and ACOs are payment schedules and care models that will become practice requirements. The successful way to adapt to these changes in the new era of health-care reform is to redesign our care models.
Compatibility of Stakeholder Initiatives in Hip Fracture Care
Quality initiatives in the management of patients with hip fracture are important because hip fractures are common, and most orthopaedic surgeons treat them. Hip fractures are associated with a high burden of morbidity and mortality7-9 and are costly to treat, with substantial variation in protocols, patient outcomes, and cost10-12. This variability in outcomes and cost makes hip fractures an ideal condition on which to focus quality improvement efforts, and there are several different organizations that have invested in the quality improvement movement in hip fracture care.
Own the Bone Program
The OTB program13, which began in 2009, is now the best developed of the quality initiatives in fragility fracture care. It includes a registry that records compliance with 10 measures before and after a fragility fracture. It also supports a fracture liaison service and provides tools, algorithms, and infrastructure to enable hospitals and practices to establish care standards for postfracture and osteoporosis treatment. Currently, there are approximately 162 active centers; over 20,000 patients have enrolled in the OTB registry over the last 6 years.
American Joint Replacement Registry
The American Joint Replacement Registry (AJRR) is a multi-stakeholder-governed registry14-19, which is unique in that the board includes physicians, patient advocates, payers, representatives from the medical device community, and others. The basic AJRR data set includes Level-I data, such as basic demographics, procedural information, and revision rates. Level-II and Level-III capabilities also have been developed to capture patient comorbidities and patient-reported outcomes. The AJRR includes hip fracture cases in patients who undergo arthroplasty; there were approximately 8,000 patients with hip fractures in the AJRR from 236 hospitals over the 3 years including 2012 through 2014. The goal of the AJRR is to improve total joint arthroplasty outcomes as well as patient safety and quality, and to reduce the overall cost of care through surveillance in measuring quality. There are over 600 hospitals enrolled in the AJRR. AJRR has data on over 270,000 arthroplasty procedures performed by more than 3,700 surgeons.
National Bone Health Alliance
The National Bone Health Alliance (NBHA) is made up of approximately 52 member organizations, including the AOA and the American Academy of Orthopaedic Surgeons (AAOS). This organization includes medical professional societies, research societies, patient advocacy groups, individual health-care providers, hospitals, the pharmaceutical and device industry, and payers. The broad vision of the NBHA is to improve the overall health and quality of life of all Americans by enhancing bone health. The NBHA has several public awareness campaigns about bone health and osteoporosis, and it also promotes a fracture liaison service similar to the OTB program. The NBHA has a Quality Improvement Registry, which is certified as a qualified clinical data registry (QCDR) by the CMS for their value-based payment programs. There are 14 measures in the registry, including both physician quality reporting system (PQRS) and non-PQRS measures. The intended users of the NBHA registry are hospitals and any physicians providing musculoskeletal care, patients, and payers, and it can be used for maintenance of certification.
National Surgical Quality Improvement Program
The National Surgical Quality Improvement Program (NSQIP) Registry20-22, originally developed for vascular and general surgeons, collects 30-day outcomes for hospital patients admitted to the vascular or general surgery services. A hip fracture module was recently created in collaboration with the AAOS Council on Research and Quality, including approximately 20 variables specific to hip fracture that were added to the existing NSQIP data collection platform as part of the Hip Fracture Targeted Procedure Pilot Project. Over 40 sites participated in the pilot project, and data on over 850 cases had been collected as of June 2015. Presently, hip fracture is an optional target procedure for hospitals participating in the NSQIP Registry.
AAOS Council on Research and Quality Evidence-Based Clinical Practice Guidelines and Derivative Products on Hip Fracture in the Elderly
The AAOS Council on Research and Quality evidence-based clinical practice guidelines and derivative products on hip fracture in the elderly23-25 are clinical treatment recommendations for elderly patients (≥65 years old) with low-energy hip fractures, which were developed through an extensive systematic review of the literature. The guidelines, published in 2014, are meant to be used by physicians, health systems, and patients, and to be interpreted in the context of individual clinical practices and individual patient preferences and values. Appropriate use criteria for both acute treatment and postoperative rehabilitation were developed based on clinical practice guidelines, and evidence-based performance measures are currently under development (www.aaos.org/guidelines).
What is the compatibility of these various initiatives in hip fracture care? Could these initiatives work collaboratively to improve the care of hip fracture patients? There are several challenges for collaboration of these initiatives: they were all started at different times with different governance models, inclusion criteria and follow-up time are not consistent, some use administrative data while some use clinical data, and some involve only passive measurement tools.
In defining a comprehensive hip fracture or geriatric fracture prevention and management quality initiative, consideration must be given to which patients should be included in the cohort (i.e., those treated operatively or all patients at risk of hip fracture). To be relevant in the area of value-based health care, we should move upstream into disease management. We must work toward standardizing the cohorts of interest, outcome parameters, follow-up duration of interest, and ways in which local quality improvement tools are deployed. A multi-stakeholder-governance model, with a sustainable funding model, should be defined, and optimal strategies should be identified for collaboration across specialty societies.
Mobile Outreach: An Innovative, Integral Part of Comprehensive Elder Fracture Care
The number of frail elderly patients is large and increasing. Approximately 50% of patients over the age of 85 years have dementia, and only 10% of the U.S. population is living in their own home when they die26. Additionally, approximately 70% of people over the age of 65 years will require long-term care27. In spite of this, cognitive impairment and decreased function (an inability to follow up in clinic) are exclusion criteria for most studies of fracture outcomes in the elderly. Therefore, the evidence-based information we have on fracture care in the frail elderly is very limited.
Given this paucity of information on fracture care in the frail elderly, treatment guidance for these patients is based primarily on experience and expert opinion; Level-V evidence suggests that the current health-care model does not provide the best care for these individuals28. In this era of bundled payments and the growth of advanced practice providers (APPs), new opportunities may exist for improving the care and outcomes in the growing population of patients with fragility fractures. Mobile Outreach, a program in which orthopaedic care is provided in a frail elderly patient’s home or care facility, provides patient and family-focused care, and creates a care system that may be advantageous under the requirements of new payment models, may utilize opportunities for engaging APPs in one’s practice, and may focus care on the outcomes that are most important to these patients and their families.
The Geriatric Fracture Program was established at the University of Minnesota and Regions Hospital in 2004 to include 3 areas of focus: an in-hospital fracture liaison service, a bone health and secondary fracture prevention service, and an on-site orthopaedic clinical service, Mobile Outreach (Fig. 3). Prior to the establishment of this program, frail orthopaedic patients were seen in clinic. Because transitions or changes in environment can be extremely disruptive for older patients, especially for those with cognitive decline29, we sought to mitigate these potential ill effects by providing orthopaedic care in a frail patient’s own home. The question was: How could we more efficiently and effectively address the orthopaedic needs of this frailer cohort?
In the 1970s, a Minneapolis geriatrician, Dr. Madeline Adcock, began providing primary care in nursing homes and assisted living facilities. In 1990, HealthPartners, an insurer and community health-care provider, established a coalition of geriatricians and geriatric nurse practitioners who provided primary care in these facilities. By 2004, given the established, robust provision of elder care in these nursing care facilities, we recognized an opportunity to provide on-site orthopaedic care, and Mobile Outreach was founded. The Mobile Outreach model has shared decision-making through high-quality communication with patients and their families as a cornerstone of the program.
Our objective was to provide orthopaedic care in nursing care facilities to minimize disruption in the daily lives of frail patients. We also sought to reduce costs and to increase patient and family education and communication. We did this from our base, Regions Hospital, a 400-bed level-I trauma center community-based hospital. Our catchment area includes 450,000 older individuals in a 7-county area in Minnesota and western Wisconsin.
In Mobile Outreach, a geriatric nurse practitioner goes to 1 of 4 geographic quadrants 1 day per week and provides on-site orthopaedic care. This care includes postoperative visits, procedural visits (e.g., cortisone injections, splint or cast management), acute injury on-site assessment, and postfracture follow-up care. Our partnership with 2 local portable radiography providers for on-site radiography mitigates the need for acutely injured patients to visit an urgent care center or an emergency room to undergo radiographic imaging. For more serious fractures, we offer direct admission to Regions Hospital, and thereby eliminate the need for these patients to endure long and often unnecessary waits in the emergency room. In addition, we provide 24/7 phone consultation to these nursing care facilities and to the geriatricians and geriatric nurse practitioners who are caring for their residents. We have weekly team meetings, daily electronic review of radiographs, and communication regarding Mobile Outreach patients through our electronic medical record (Fig. 4).
Mobile Outreach provides orthopaedic care for the frailest patients, including those whose orthopaedic needs are often nonsurgical and for whom transportation is a hardship. Although the program supports 174 facilities, there are approximately 10 core locations where we provide the majority of our on-site care with patient visits, educational programs, and established evidence-based protocols.
A basic economic analysis of the program demonstrated substantial cost savings to both individual patients and health-care organizations30. Based on retrospective analysis of our patient population, we estimated the number of patients who would travel to clinic by ambulance, by MediCab, by taxi, and by personal/family transport. Using this “case-mix” volume for this patient population, we calculated that the average cost of a trip from the patient’s location of residence to the clinic is reasonably estimated to be $70. Utilizing this transport cost average along with actual patient encounter data for 2015, the realized annual cost-of-care savings are summarized in Table I. Mobile Outreach clinical services provided at the patient’s location of residence realized an estimated cost savings of $67,230. This was accomplished through the provision of 220 on-site injections, 256 on-site postoperative visits, and 64 on-site clinic visits for other orthopaedic issues. Each of these encounters realizes cost savings from the elimination of the global charge for a clinic visit, the avoidance of transportation fees, and/or the reduced charge for the services provided. In addition, Mobile Outreach services helped patients to avoid hospitalization as well as avoid emergency room or urgent care visits through direct admissions, totaling an estimated savings of $130,053.
In 2015, Mobile Outreach aided in the care of >300 individual elderly orthopaedic patients, and realized an estimated $197,283 in health-care savings (Table I). Current limitations to expansion of the program or broader adoption include a need for more sophisticated economic and patient outcomes analysis, which is currently lacking, including actual cost data and offsetting expenses to the health system for the provider and travel costs. Additionally, access to portable radiography providers of proven quality and timeliness that have electronic data transfer capabilities is required to implement such a care model. Although these limitations are present, Mobile Outreach offers potential improvements in care for the frail elderly orthopaedic patient, and may offer solutions in bundled care episodes for the 90-day postoperative period.
In conclusion, the number of frail elderly patients is increasing, and the way we currently care for them is not ideal. Through programs such as Mobile Outreach, we may be able to provide necessary and appropriate orthopaedic care in a patient’s own environment. An opportunity exists for orthopaedists and other stakeholders to actualize a collaborative care model such as this.
Health-care reform represents a disruptive innovation for orthopaedic surgeons. Many of the most costly DRGs in American health care are held by orthopaedists, including total joint replacement, hip fracture, and spine surgery. Alternative payment models, including bundled care and ACOs, currently are being phased in by the CMS. Successful bundling requires a care redesign, and surgeons must rise to this challenge with an organized effort. Our national organizations must agree to work together to achieve the required changes. Innovation in post-acute care is required, and programs such as Mobile Outreach will be important for providing the best, most value-based care, especially for the frailest patients.
Disclosure: On the Disclosure of Potential Conflicts of Interest forms, which are provided with the online version of the article, one or more of the authors checked “yes” to indicate that the author had a relevant financial relationship in the biomedical arena outside the submitted work and “yes” to indicate that the author had other relationships or activities that could be perceived to influence, or have the potential to influence, what was written in this work (http://links.lww.com/JBJS/C255).
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