From cost to patient care — The many ways orthopedic bundled payments help hospitals

Mary Rechtoris -  

Bundled payments allow medical professionals to understand the costs of care in a way they were not able to before.

"Nobody had the whole picture," said Denise McGinley, RN, of Phoenix-based St. Luke's Medical Center. "In bundled payments, we learned we need to be in charge of the entire 90 days. This does not only include the surgical procedure, but everything that happens to the patient health-wise in those following 90 days."


The Centers for Medicare & Medicaid Services finalized a payment model holding acute care hospitals accountable for the quality of care they deliver to Medicare patients for hip and knee replacement from surgery through recovery. The Comprehensive Care for Joint Replacement Model is required for most hospitals in the 67 geographic areas that perform lower extremity joint replacements. The CJR model will begin April 1, 2016.


CMS is implementing the CJR model to reduce variation in the way facilities perform surgeries and treat patients. The payment model aims to minimize variation in the way facilities look at institutional cost savings and expenditures for hip and knee replacements.


In a webinar hosted by Pacira Pharmaceuticals titled "Success Stories in Orthopaedic Bundled Payments," Michael Kelly, MD, and Denise McGinley, RN, detail their experiences utilizing bundled payments and the benefits the payment system provided their facilities.


Hackensack University Medical Center's setup
Orthopedic surgeon Dr. Kelly practices at Hackensack University Medical Center, a 900-bed, non-profit, research and teaching hospital in New Jersey. The hospital has been part of CMS' voluntary Lower Extremity Joint Replacement bundled payment system for total hip arthroplasties and total knee arthroplasties for the last 18 months. According to Dr. Kelly, it took Hackensack 18 months to break even financially on the joint replacements in the bundled payment program. Although this may not seem promising to many facilities, the results the payment system yielded tremendous cost savings after those months.


The bundled payment system has critical features to reduce total episode of care cost. To lower costs, a facility should:


•    Reduce post-acute care costs
•    Implement data analytics
•    Adjust institutional mindset
•    Coordinate patient care at all levels
•    Take a patient-centric approach to care


The post-acute phase of a patient's care is crucial to reducing overall cost.


"Dischargers to home are the largest contributor to total episode cost," said Dr. Kelly. "If you do not increase the number of patients discharged to home, your facility will not break even."


To discharge more patients and ultimately lower costs, patient education is crucial.


Patient satisfaction is an essential part of healthcare, especially as healthcare becomes increasingly centered on the patient experience. Often, a patient is not satisfied due to a lack of co-alignment of their expectations with their surgeon's expectations. A bundled can amend this issue by helping medical professionals look at each aspect of the patient experience from beginning to end — 90 days after surgery.


Hackensack began using a multimodal pain management approach, making patients comfortable enough in the immediate postoperative period to return home. THA and TKA are painful operations, and in the past providers prescribed large amounts of opioids to curb the pain.


In the bundled payment model, the hospital changed its pain managemnet protocol. The hospital eliminated the patient controlled analgesic and femoral catheters, which according to Dr. Kelly has been "a huge patient satisfier." Following surgery, the hospital administered up to two doses of acetaminophen. Patients would receive Celecoxib and rescue opioid as necessary.


Through this pain management approach, Hackensack found a reduction in patient falls and length of stay; more discharges to home rather than skilled nursing facilities; and patients were able to get up and out of bed earlier, among other benefits.


St. Luke's Medical Center's setup
Similar to Hackensack, St. Luke's Medical Center also experienced enhanced patient outcomes after utilizing bundled payments. St. Luke's Medical center is a 200-bed tertiary care center with fellowship programs in adult reconstructive surgery. The hospital has three years of experience bundling TKA and THA procedures. After implementing bundles, the hospital started performing 1,200 LEFR cases annually, up from 425 cases in the fiscal year 2010.


Prior to using the bundled, the hospital was confident in their patient outcomes.


"We felt we were highly successful in outcomes and we thought we were lean," said Ms. McGinley, the director of the Center for Orthopaedic Innovation at St Luke's Hospital. "Once we used the bundles and looked at the data, we realized how much we didn't know."


When the CMS provided the data to the hospital, Ms. McGinley and her colleagues found the lengths of stay at skilled nursing facilities reached 21 days, which was a major cost to the hospital. Using data from the bundled system, the hospital could analyze patients 30 days, 60 days and 90 days post-discharge and evaluate patient experience. Using these trends, the hospital could determine ways to improve patient care and save on post acute care costs.


In a feedback report from July 2014 to June 2015, St. Luke's patient outcomes proved better than the national average. The length of stay nationwide for TKA and THA was 4.4 days. At St. Luke's, the average length of stay was merely 1.2 days after implementing the bundled payment system.


"All our surgeons used micro-invasive procedures," said Ms. McGinley. "By using better surgical technology and better team management, we are able to get patients out after 1.2 days. That is a tremendous cost savings."


The hospital found a reduction in infection rates when getting patients home sooner. Also, the hospital had a reduction in 30-day unplanned readmissions. At St. Luke's, only 0.7 percent of TKA and THA patients were readmitted after 30 days, compared to the national average of 6.2 percent.


To reap the benefits a bundle offers, St. Luke's had to recognize its deficiencies. "If there was one big takeaway, it is that we don't communicate as well as we should," said Ms. McGinley. "You have to communicate on so many levels on bundles. With bad communication, you could lose the bundle."


Both hospitals used the wealth of data a bundle offers to improve patient care. "While we started with lowering costs, we've ended with huge improvements in patient care," said Dr. Kelly. "The bottom line is CMS is hoping our patient outcomes will become exceptional at the end of the day. From my experience, that has been a true statement. We have seen remarkably better care because of the bundles."


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