For years, joint replacement surgeons responded to falling reimbursement by getting more efficient. They shortened hospital stays, moved appropriate cases outpatient, reduced readmissions, optimized patients before surgery and absorbed more of the work before and after the operating room.
When another cut came, many private practices found a familiar answer: do more cases.
P. Maxwell Courtney, MD, believes that strategy is running out of room. “We are now at a breaking point,” Dr. Courtney, division chief of adult reconstruction at Philadelphia-based Rothman Orthopaedics, told Becker’s.
CMS has proposed another substantial reduction in physician payment for total joint replacement in 2027, after hip and knee surgeons already faced a reimbursement reduction in 2026.
For Dr. Courtney, the dispute exposes a deeper problem than the size of one cut. Joint replacement has become substantially more efficient, but much of the work that made that possible has shifted outside the hospital, where the physician payment system does not necessarily see it.
At the same time, the economics of running an orthopedic practice have moved in the opposite direction.
That collision is beginning to change the choices surgeons are willing to make. Dr. Courtney said he is considering opting out of Medicare and expects he may do so Jan. 1. He also anticipates several other joint replacement surgeons at Rothman could make the same decision.
None of them, he said, want to.
The work did not disappear, it moved
Dr. Courtney trained in joint replacement about 15 years ago. The experience looked very different then. Patients commonly spent several days in the hospital. Opioid use was heavier. Rehabilitation facilities were used more frequently. Transfusions and prolonged bed rest were more common.
Today, many hip and knee replacement patients can safely return home far sooner. Dr. Courtney argues that transformation did not happen because the operation suddenly required less physician involvement. It required surgeons to take responsibility for far more of the episode surrounding it.
Joint replacement teams screen for diabetes and poor glycemic control, evaluate anemia, counsel patients on weight and smoking, manage medications that can increase infection risk and coordinate medical optimization before surgery.
“We are the primary care docs of orthopedics,” Dr. Courtney said.
The work continues after discharge. Dr. Courtney pointed to Rothman research finding that patients contact the practice, on average, about seven times around surgery during the 90-day episode. Electronic messaging lets patients ask about pain, wounds, therapy prescriptions and other concerns without another office visit or trip to the emergency department. That is better for patients. It is not necessarily reflected in the physician work used to value the procedure.
“These are not reimbursable minutes,” he said. “The amount of work is not being reflected in what we’re actually doing to take care of the patients.”
Joint replacement became more efficient partly because physicians moved work upstream and downstream. The payment system, Dr. Courtney believes, has too often interpreted a shorter hospital stay as less work.
Private practices kept getting on the ‘hamster wheel’
Historically, practices had a way to absorb smaller reimbursement cuts: Volume. “When you take a 5% hit, we’ve been able to offset it by becoming more efficient,” Dr. Courtney said. A surgeon could reduce turnover time, improve staffing and add another case to the schedule.
“You’ve been able to kind of jump on the hamster wheel and get more cases done,” he said.
The problem is that a surgeon cannot add cases indefinitely. Meanwhile, the fixed cost of delivering care keeps rising. Dr. Courtney said malpractice coverage in Philadelphia costs him roughly $100,000 annually. Wages, staffing, rent and other practice expenses have climbed as well. At the same time, he said inflation-adjusted Medicare payment for hip and knee replacement has fallen dramatically over the past three decades.
“The cost of taking care of these patients continues to increase, and our reimbursement continues to decline,” he said.
Medicare accounts for about 60% of Dr. Courtney’s patient volume, he said, but a much smaller share of practice revenue. That creates a question private orthopedic groups cannot indefinitely avoid: At what point does caring for a Medicare patient cost more than Medicare pays the practice to provide the care?
“We’re facing a point where we may end up losing money taking care of Medicare patients,” Dr. Courtney said.
The next response may not be more volume
Once efficiency can no longer absorb another cut, the options become less comfortable. Dr. Courtney sees three possibilities increasingly entering conversations among private practices.
Some may limit the number of new Medicare patients they accept. Others may explore legally structured concierge offerings for services not covered by Medicare. And more surgeons may opt out of Medicare altogether.
Historically, that has been rare in orthopedics. Dr. Courtney said only a small proportion of orthopedic surgeons have opted out, although he believes continued reimbursement pressure could accelerate the trend. He may become one of them.
Dr. Courtney told Becker’s he is considering leaving Medicare and said several other Rothman joint replacement surgeons are weighing the same move. “This is a choice that we’re now being forced on, because it’s not economically sustainable to sustain a private practice,” he said. “None of us actually want to opt out of Medicare. We still want to care for Medicare patients.”
Opting out also changes the financial relationship between surgeon and patient. Outside Medicare, Dr. Courtney said physicians have more flexibility to establish prices directly and, where appropriate, adjust them based on a patient’s circumstances. He emphasized that surgeons could still choose to care for patients who cannot afford standard fees and continue following patients they previously operated on.
But that flexibility does not erase the larger access problem. If increasing numbers of surgeons stop accepting Medicare, patients have fewer places to go.
Patients may feel the cut first in the calendar
Dr. Courtney expects the first visible consequence to be wait times. Today, he said, U.S. patients seeking joint replacement may wait several weeks depending on the surgeon. He worries reduced Medicare participation and continued consolidation could push the system toward much longer queues.
That matters because delaying a hip or knee replacement is not clinically neutral. Patients can lose mobility. Pain can worsen. Other health needs can increase as activity declines, and some patients may use emergency departments or hospitals more frequently while waiting for definitive treatment.
“Patients are going to have longer wait times,” Dr. Courtney said.
He also expects reimbursement pressure to accelerate another trend already reshaping orthopedics: the decline of smaller private practices. Dr. Courtney said private practice now represents a substantially smaller share of orthopedic surgeons than it did two decades ago. Higher operating costs, prior authorization burden and reimbursement pressure are making scale increasingly important.
His long-term view is a much more consolidated market: a relatively small number of large independent orthopedic groups, large health systems and private equity-backed platforms.
That may bring efficiencies of its own. Dr. Courtney worries about what it could take away. As surgeons are pushed to increase volume, he said, it becomes harder to spend as much time with each patient.
“The loss of private practice in orthopedic surgery will mean worse care for patients,” he said.
This is not a physician-versus-hospital fight
Dr. Courtney is careful not to frame the payment debate as surgeons against hospitals. Hospitals face their own inflationary pressures, staffing costs and capacity constraints. But he sees a striking difference in how the payment systems are moving. Facility reimbursement has continued to receive increases, even if those increases have not always kept pace with inflation, while physician reimbursement has repeatedly been pressured downward.
He also expects those economics to reinforce joint replacement’s migration toward ASCs, particularly as large hospitals struggle to create additional OR capacity. Still, shifting more procedures outpatient does not resolve the underlying physician-payment problem.
In Dr. Courtney’s view, it makes the contradiction more obvious. Surgeons have spent years helping create the lower-cost model policymakers want. Then, as hospital utilization falls, the physician work associated with the procedure is valued less.
“We are getting penalized for our own efficiency,” he said.
The bigger fight is over how physician work is valued
As advocacy chair for the American Association of Hip and Knee Surgeons, Dr. Courtney does not believe stopping one proposed cut will solve the underlying problem.
The Medicare Physician Fee Schedule is constrained by budget neutrality, meaning increases in one area generally have to be offset elsewhere.
Dr. Courtney strongly supports increasing investment in primary care. His wife is a pediatrician, and he believes primary care physicians are significantly undervalued.
He rejects the idea that specialists should have to fund the solution. “It should not be a zero-sum game,” he said.
Long term, he wants broader reform of physician payment, including changes to budget neutrality and a mechanism that better accounts for inflation. He also believes surgeons should have greater opportunities to share in savings they help generate through value-based and bundled-payment programs.
For now, however, the immediate ask is simpler: Pause the proposed joint replacement cuts while CMS reexamines how physician work should be measured. If the government is considering broader changes to the way physician services are valued, Dr. Courtney argues it makes little sense to impose a major reduction first and redesign the system afterward.
“CMS wants to make sweeping changes to how physicians are paid in this country,” he said. “They need to think twice about having such sweeping reforms with a massive 20% cut.”
The stakes are often described in reimbursement percentages and relative value units. Dr. Courtney sees a more practical question underneath them.
Joint replacement surgeons have already shown they can make care faster, safer and less dependent on the hospital. For years, private practices responded to declining payment by squeezing more efficiency out of the same day.
If that strategy has reached its limit, the next efficiencies may not come from the operating room. They may come from seeing fewer Medicare patients. And that is when a physician payment cut becomes a patient access problem.
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