The Growth Channel

CMS removes knee replacements from 'inpatient-only list'—here's what it means for your hospital

By Austin Terry and Tracy Walsh

Yesterday, CMS released the Final Hospital Outpatient Prospective Payment System (OPPS) Rule for 2018 which removes total knee arthroplasties (TKAs) from the inpatient only list. This move will allow Medicare to reimburse TKAs performed on an outpatient basis, likely resulting in a shift of thousands of procedures from inpatient to outpatient.

Join us Nov. 10 as we examine CMS's changes to hospital outpatient payment in 2018

Hospital inpatient revenue projected to decrease

The removal of total knee arthroplasties (TKAs) from CMS' inpatient-only list comes on the heels of an intense debate as to whether or not knee replacement procedures are clinically appropriate to be performed in the outpatient space.

As we wrote in August, roughly 48% of the 275,000 Medicare inpatient total knee replacement cases without major complications are performed on patients eligible for outpatient surgery. These patients are younger than 80 and without a history of falls, obesity, and other complications that would impact their ability to undergo their knee replacement in the outpatient setting.

With CMS’s reimbursement rate of $12,384 for inpatient TKAs and $10,122 for outpatient TKAs, a shift of 48% of Medicare TKA cases to outpatient settings would result in an 18% decrease in reimbursement for providers, and $311M in savings for Medicare.


Learn more about outpatient payment in 2018

Join us for a webconference on Nov. 10 to learn about CMS's changes to hospital outpatient and ambulatory surgical center payments in CY 2018.

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How to predict threats to service line growth

Virtually all hospitals and health systems rely on procedure demand forecasts to guide service line planning. However, many organizations lack visibility into the impact of looming market “shocks”—including things like new bundled payments and the rise of virtual care models—on their ability to win share.

This infographic identifies the most pressing market shocks to each service line and provides proactive guidance on how to keep your service lines one step ahead of these threats.

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