Key Considerations for Success Under Joint Replacement Bundled Payment

Get an overview of new payment models coming to orthopedics, 10 tactics for success under bundled payment, and case studies and implementation guidance from leading bundled payment participants.

Orthopedic programs have long functioned under a volume-driven, fee-for-service environment. However, the Affordable Care Act has prompted CMS and private payers to investigate new payment models. Bundled payment is emerging as a key stepping stone in the transition from fee-for-service to total cost control. CMS’s finalization of the Comprehensive Care for Joint Replacement (CJR) model, which mandates bundled payment for Medicare joint replacement patients at around 800 hospitals across the country, signals the emergence of orthopedic bundled payment as a crucial payment paradigm.

Bundled payment combines all episodic spending into a single payment, essentially assigning responsibility for the entire patient episode to a single provider. As such, the payment model elevates the familiar imperatives of cost and quality to the episodic level.

Providers must bring down costs and improve quality across the inpatient and post-acute portions of the joint replacement episode. Doing so requires coordinating stakeholders in what may be new ways, such as engaging physicians to think about cost and discharge disposition. It also requires coordinating with stakeholders traditionally outside the focus of acute care providers; with half of episodic cost arising after discharge, post-acute providers (PACs) are an essential part of the bundled payment initiative.

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