Bundled payments didn’t increase volumes for joint replacement

Participation in CMS’s Bundled Payment for Care Improvement Program (BPCI) didn’t lead to more lower extremity joint replacement procedures being performed, according to a study conducted by the Altarum Institute’s Center for Payment Innovation.

The study follows a JAMA Internal Medicine analysis from January that said hospitals could save an average of 8 percent on these procedures with bundled payment programs without a decline in quality. That conclusion was disputed in an editorial by Harvard University researchers Katherine Baicker, PhD, and Michael E. Chernew, PhD, who argued spending may have risen due to an increase in the volume of joint replacement procedures, erasing any savings per episode.

“Some of this may reflect broad trends for greater use or shifts in care toward the participating facilities. Much more work is needed to assess how health status changes affect calculated savings and the extent to which volume increases offset per episode savings,” Baicker and Chernew wrote.

The Altarum study shoots this theory down by comparing Medicare data on these procedures performed at BPCI-participating and non-participating hospitals. January 2011 to December 2013 was used as the baseline period (though BPCI began in October 2013), with January 2014 to December 2015 as the implementation period.

During the baseline period, the number of procedures performed at BPCI hospitals was higher than non-participants. After the start of BPCI, adjusted average annual volumes at non-participants increased by 1.7 percent, while the increase at BPCI hospitals was “not significantly higher.”

"Our findings are consistent with other studies that have shown no evidence that bundled payments are responsible for artificially increasing the volume of procedures,” said François de Brantes, vice president and director of Altarum's Center for Payment Innovation. “Changes in procedure volume are explained by other factors such as market competition, the penetration of Medicare Advantage, and the demographic characteristics of the Medicare population."

Those changes required a deeper investigation within hospital referral regions, according to the Altarum study.  Nationally, most BPCI participants were within regions with prevalence rate of lower extremity joint replacement procedures that were at or below the national average.