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Two surprises from our analysis of pandemic hospitalizations

By Sebastian BeckmannMegan DirectorDhananjai Seth

July 13, 2021

    In our last post on Covid-19 pandemic volumes, we shared two insights from our analysis of Medicare fee-for-service claims from Q2 and Q3 of 2020—hospital volumes dropped by over a fifth and patient complexity grew, though less than expected.

    Despite the considerable drop in hospital volumes, a few procedures fared better than most. Read on for our experts’ take on how Covid-19 impacted growth in orthopedics and cardiovascular care and what that means for future volume trends.

    1. Joint replacement volumes dropped less than expected

    Joint replacement is a plannable, non-life-saving procedure. It has a diagnostic pipeline that can stretch for months and about a third of patients shop for care rather than follow a physician referral. All those criteria suggest that volumes should have declined precipitously during the pandemic. And based on the inpatient data, that’s exactly what happened. Inpatient joint replacement volumes fell 43% from 293K in Q2 and Q3 of 2019 to 166K in Q2 and Q3 of 2020.1 That’s the largest single volume decline of any inpatient subservice line.

    However, hospital outpatient volumes tell a different story. Hospital outpatient department (HOPD) joint replacement volumes grew 71%, from 57K in Q2 and Q3 of 2019 to 98K in Q2 and Q3 of 2020.2 This growth is likely due to a combination of factors. To start, 2020 was the first year that CMS made total hip replacement eligible for outpatient reimbursement. This policy change drove a significant portion of inpatient hip replacement surgeries to be completed as outpatient cases, especially as hospitals canceled inpatient procedures due to the pandemic. There were 14K and 12K outpatient total hip replacements in Q1 and Q2 of 2020 respectively followed by an 81% growth in volume to 22K in Q3 2020, indicating that longer-term pandemic fears shifted a large share of these volumes outpatient.

    We also saw a modest increase (11%) from Q2 and Q3 of 2019 to 2020 in hospital outpatient knee replacements in a time when most services were seeing rapid declines. The need to recoup financial losses from canceled inpatient joint replacements, along with physicians’ increasing comfort performing these procedures in the HOPD, further incentivized this site of care shift despite lower marginal reimbursement.

    As joint replacement volumes continue to rebound, we will expect to see an accelerated shift from inpatient to HOPD and freestanding sites of care.

    2. Two cardiovascular procedures grew despite the pandemic

    When we excluded patients diagnosed with Covid-19 in our analysis we were surprised to see a small number of MS-DRGs showing larger volumes in Q2 and Q3 2020 than in the same period a year before. Most notable were two cardiovascular MS-DRGs: MS-DRGs 266 and 267, which cover interventional structural heart procedures including transcatheter aortic valve replacement (TAVR) and transcatheter mitral valve repair (TMVr).

    Table: Cardiovascular procedures with volume growth

    Once again, the growth was likely driven by two major regulation changes that took place in the summer of 2019. First, the approval of TAVR in low-risk patient populations opened access to patients previously only qualified for surgical AVR. Second, CMS released an updated National Coverage Determination that enabled more hospitals to begin offering the procedure through lower volume requirements.

    Pre-pandemic we expected that 2020 would have been a banner year for TAVR as these regulatory changes opened the door to a significant influx of newly-eligible patients as well as newly-accessible markets. And although these procedures had significantly less growth than predicted, we still saw an increase in volumes during the height of the pandemic.

    It’s worth noting that while TAVR is usually an elective procedure, patients requiring AVR experience symptoms that significantly impact their quality of life, so it is understandable why patients would have been more likely to prioritize this procedure even during a time when they were avoiding the hospital. Additionally, for patients who wanted to minimize their time in the hospital during the pandemic—while hospitals simultaneously needed to preserve bed capacity for Covid-19 patients—TAVR would have been a preferable alternative to surgical AVR with its much lower length of stay. The pandemic, therefore, may have accelerated adoption of TAVR in the newly-approved low-risk patient set.

    More to come

    Stay tuned to the Advisory Board blog for more insights from our analysis of claims data from the pandemic and what it means for you! Still to come: how patient behavior might continue to shape utilization in the year to come, and what Q4 2020 data tells us about future prospects for volume recovery.



    [1] Our analysis included only short-term acute care and critical access hospitals, excluding long-term acute care facilities and inpatient rehabilitation facilities.

    [2] We defined outpatient to include hospital outpatient department facility claims. Outpatient service line definitions are based on the Advisory Board’s proprietary outpatient grouping algorithm which organizes patient visits based on the primary service received. These primary service groups can then be assigned to service line hierarchies that mimicking the inpatient MS-DRG system.

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