A study published in the Journal of the American Medical Association examined changes in quality, internal hospital costs and postacute care spending for lower extremity joint replacement bundled payments.
Researchers analyzed 3,942 patients who had a joint replacement surgery measuring the average Medicare payments per episode, readmission rates, emergency department visits, length of stays and hospital savings from changes in cost and postacute care spending.
Here's what they found.
1. Between June 2008 and June 2015, average Medicare spending declined 20.8 percent per episode without complications from $26,785 to $21,208.
2. Spending declined 13.8 percent from $38,537 to $33,216 per episode with complications.
3. Readmissions, emergency department visits and prolonged length of stays also declined 1.4 percent, 0.9 percent and 67 percent respectively.
4. Patient illness severity remained the same.
5. Concerning cost savings, 51.2 percent was through internal cost reductions and 48.8 percent was from postacute care reductions. The reduced cost of implants was down $1920.68 — 29 percent — per case.
The researchers concluded despite Medicare payments for total joint replacements increasing, bundled payments saved hospitals substantial amounts of money while reducing Medicare payments.