Association Between Medicare’s Mandatory Joint Replacement Bundled Payment Program and Post–Acute Care Use in Medicare Advantage | Orthopedics | JAMA Surgery | JAMA Network
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Table 1.  Baseline Characteristics of Medicare Advantage and Traditional Medicare LEJR Discharges Before the Implementation of Mandatory Bundled Payment Program, 2013 to 2015a
Baseline Characteristics of Medicare Advantage and Traditional Medicare LEJR Discharges Before the Implementation of Mandatory Bundled Payment Program, 2013 to 2015a
Table 2.  Changes in Institutional Post–Acute Care Use Before and After Implementation of Bundled Payment Program, 2013 to 2015 vs the Last 3 Quarters in 2016a
Changes in Institutional Post–Acute Care Use Before and After Implementation of Bundled Payment Program, 2013 to 2015 vs the Last 3 Quarters in 2016a
1.
Newhouse  JP, Marquis  MS.  The norms hypothesis and the demand for medical care.  J Hum Resour. 1978;13(suppl):159-182. doi:10.2307/145251PubMedGoogle ScholarCrossref
2.
Landon  BE.  Tipping the scale—the norms hypothesis and primary care physician behavior.  N Engl J Med. 2017;376(9):810-811. doi:10.1056/NEJMp1510923PubMedGoogle ScholarCrossref
3.
McWilliams  JM, Landon  BE, Chernew  ME.  Changes in health care spending and quality for Medicare beneficiaries associated with a commercial ACO contract.  JAMA. 2013;310(8):829-836. doi:10.1001/jama.2013.276302PubMedGoogle ScholarCrossref
4.
Barnett  ML, Wilcock  A, McWilliams  JM,  et al.  Two-year evaluation of mandatory bundled payments for joint replacement.  N Engl J Med. 2019;380(3):252-262. doi:10.1056/NEJMsa1809010PubMedGoogle ScholarCrossref
5.
Dummit  LA, Kahvecioglu  D, Marrufo  G,  et al.  Association between hospital participation in a Medicare bundled payment initiative and payments and quality outcomes for lower extremity joint replacement episodes.  JAMA. 2016;316(12):1267-1278. doi:10.1001/jama.2016.12717PubMedGoogle ScholarCrossref
6.
Huckfeldt  PJ, Escarce  JJ, Rabideau  B, Karaca-Mandic  P, Sood  N.  Less intense postacute care, better outcomes for enrollees in Medicare advantage than those in fee-for-service.  Health Aff (Millwood). 2017;36(1):91-100. doi:10.1377/hlthaff.2016.1027PubMedGoogle ScholarCrossref
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    Research Letter
    October 2, 2019

    Association Between Medicare’s Mandatory Joint Replacement Bundled Payment Program and Post–Acute Care Use in Medicare Advantage

    Author Affiliations
    • 1Harvard Medical School, Boston, Massachusetts
    • 2Harvard T. H. Chan School of Public Health, Boston, Massachusetts
    • 3Brigham and Women’s Hospital, Boston, Massachusetts
    • 4Beth Israel Deaconess Medical Center, Boston, Massachusetts
    JAMA Surg. 2020;155(1):82-84. doi:10.1001/jamasurg.2019.3957

    Under bundled payment programs, such as Medicare’s Comprehensive Care for Joint Replacement (CJR) model, hospitals bear financial risk for posthospitalization care for beneficiaries in traditional fee-for-service Medicare. It is unknown whether participating hospitals change care patterns only for patients subject to the payment bundle or if changes spillover onto care for other patients undergoing joint replacement. Spillovers to Medicare Advantage (MA) patients would indicate that clinicians have a consistent approach to discharge planning regardless of payer1,2 and would suggest Medicare’s payment reforms have had a broader societal effect.3

    The CJR model was implemented in a random sample of communities and only includes patients with traditional Medicare who received a lower extremity joint replacement (LEJR). In prior evaluations of CJR and other LEJR bundled payment programs, spending reductions have primarily been driven by fewer discharges to institutional post–acute care settings.4,5 We evaluated whether the reductions in institutional posthospitalization care observed in the first year of the CJR program among traditional Medicare patients were also observed among MA patients who underwent LEJR.

    Methods

    Using 2013 to 2016 Medicare MedPAR data, which include hospitalizations for traditional Medicare and MA-insured patients at hospitals that receive disproportionate share subsidies,6 we identified all LEJRs (diagnosis related groups 469 and 470) in acute care hospitals located in the 75 metropolitan statistical areas (MSAs) initially randomized to CJR (“treatment” hospitals) and the 121 MSAs randomized to usual payment (“control” hospitals). The study was approved by the Harvard Medical School Committee on Human Studies, which granted a waiver of informed consent because the study analyzed deidentified secondary data. We excluded patients not enrolled in Medicare parts A and B during the month of their admission, patients with end-stage renal disease, and patients who died before discharge. We limited hospitals to those that received disproportionate share subsidies in 2013 and had at least 10 MA and 10 traditional Medicare LEJR discharges during the study period. These criteria eliminated 360 of 1674 hospitals (22%) that provided 96 109 of 1 556 823 LEJR discharges (6%) in these MSAs. We identified comorbidities defined by Medicare’s readmission program for LEJR using diagnoses on each hospitalization record. Our primary outcome was discharge to institutional post–acute care (including skilled nursing facilities, inpatient rehabilitation facilities, long-term care hospitals, or other institutional settings, such as hospice) vs home.

    The CJR program began in the second quarter of 2016. We defined the preintervention period as 2013 to 2015 and the postintervention period as the last 3 quarters of 2016. We conducted a difference-in-differences analysis using a linear regression with hospital and quarter fixed effects to measure the differential change in institutional post–acute care use in the traditional Medicare and MA samples. We did not observe substantive differences in the preintervention trends between intervention and control hospitals in either population. All models were adjusted for patient characteristics and included sample weights.4 Standard errors were clustered within MSAs and P values less than .05 were considered significant. All analyses were conducted using Stata, version 15 (StataCorp).

    Results

    Before CJR program implementation, MA patients received less institutional post–acute care, including inpatient rehabilitation, compared with patients in traditional Medicare (Table 1).6 In hospitals affected by the CJR program, the use of institutional post–acute care differentially decreased by 2.1% (95% CI, −3.9% to −0.2%; P = .03) among MA patients and 2.3% (95% CI, −4.0% to −0.7%; P < .01) among traditional Medicare patients (Table 2).

    Among traditional Medicare patients, there was a differential reduction in discharge to inpatient rehabilitation facilities of −1.4% (95% CI, −2.3% to −0.5%; P < .01). The decline in discharge to inpatient rehabilitation facilities among MA patients was smaller and not significant.

    Discussion

    For patients who underwent LEJR, Medicare’s CJR program reduced use of institutional post–acute care among patients affected by the program (traditional Medicare) and those not affected by the program (enrolled in MA plans). Our finding is consistent with prior research in which clinicians’ responses to payment reforms were not limited by payer1,2 and suggests that the societal effect of CJR is broader than the traditional Medicare population. This is also notable, given that in MA plans incentives to lower post–acute spending were already present and the use of institutional post–acute care was lower at baseline, suggesting that capitated health plans may be limited in their ability to curb spending without aligning clinician incentives.

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    Article Information

    Accepted for Publication: June 29, 2019.

    Corresponding Author: Ateev Mehrotra, MD, MPH, Harvard Medical School, Department of Health Care Policy, 180 Longwood Ave, Boston, MA 02115 (mehrotra@hcp.med.harvard.edu).

    Published Online: October 2, 2019. doi:10.1001/jamasurg.2019.3957

    Author Contributions: Dr Mehrotra had full access to all of the data in the study and takes responsibility for the integrity of the data and the accuracy of the data analysis.

    Concept and design: Wilcock, Barnett, McWilliams, Mehrotra.

    Acquisition, analysis, or interpretation of data: All authors.

    Drafting of the manuscript: Wilcock.

    Critical revision of the manuscript for important intellectual content: All authors.

    Statistical analysis: Wilcock, Barnett, McWilliams, Mehrotra.

    Obtained funding: Barnett.

    Conflict of Interest Disclosures: Dr McWilliams reported grants from the National Institute on Aging and serving as a member of the board of directors for the Institute for Accountable Care. Dr Grabowski reported personal fees from NaviHealth, Precision Health Economics, CareLinx, and Vivacitas. Dr Mehrotra reported leading a contract on physician payment not related to bundled payment for Medicare outside the submitted work. No other disclosures were reported.

    Funding/Support: This work was supported by Commonwealth Fund and National Institute on Aging/National Institutes of Health grants K23 AG058806 and P01 AG032952.

    Role of the Funder/Sponsor: The funding organizations had no role in design and conduct of the study; collection, management, analysis, and interpretation of the data; or preparation, review, or approval of the manuscript.

    References
    1.
    Newhouse  JP, Marquis  MS.  The norms hypothesis and the demand for medical care.  J Hum Resour. 1978;13(suppl):159-182. doi:10.2307/145251PubMedGoogle ScholarCrossref
    2.
    Landon  BE.  Tipping the scale—the norms hypothesis and primary care physician behavior.  N Engl J Med. 2017;376(9):810-811. doi:10.1056/NEJMp1510923PubMedGoogle ScholarCrossref
    3.
    McWilliams  JM, Landon  BE, Chernew  ME.  Changes in health care spending and quality for Medicare beneficiaries associated with a commercial ACO contract.  JAMA. 2013;310(8):829-836. doi:10.1001/jama.2013.276302PubMedGoogle ScholarCrossref
    4.
    Barnett  ML, Wilcock  A, McWilliams  JM,  et al.  Two-year evaluation of mandatory bundled payments for joint replacement.  N Engl J Med. 2019;380(3):252-262. doi:10.1056/NEJMsa1809010PubMedGoogle ScholarCrossref
    5.
    Dummit  LA, Kahvecioglu  D, Marrufo  G,  et al.  Association between hospital participation in a Medicare bundled payment initiative and payments and quality outcomes for lower extremity joint replacement episodes.  JAMA. 2016;316(12):1267-1278. doi:10.1001/jama.2016.12717PubMedGoogle ScholarCrossref
    6.
    Huckfeldt  PJ, Escarce  JJ, Rabideau  B, Karaca-Mandic  P, Sood  N.  Less intense postacute care, better outcomes for enrollees in Medicare advantage than those in fee-for-service.  Health Aff (Millwood). 2017;36(1):91-100. doi:10.1377/hlthaff.2016.1027PubMedGoogle ScholarCrossref
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