David M. Kalainov, MD, is a clinical professor of orthopedic surgery at Chicago-based Northwestern University Feinberg School of Medicine.
Since beginning in clinical practice in 1997, Dr. Kalainov has been both in private practice and an employed physician. Here, Dr. Kalainov discusses his views on value-based care and where he sees the best opportunities in the future.
Question: What do you think are the most effective value-based care models in orthopedics?
Dr. David Kalainov: The majority of orthopedic practice revenue remains fee-for-service; however, the transition to a value-based reimbursement system is occurring rapidly. I suspect that many orthopedic surgeons are unaware of their current participation and available opportunities for inclusion in one or more value-based care payment models. In a recently published survey from the NEJM Catalyst Insights Council (July 2018), approximately 25 percent of clinician respondents did not know their organizations' status in value-based care.
For orthopedists who participate in Medicare and Medicaid, there are several value-based care program options promulgated by CMS. Arrangements include shared savings, bundled payments, and capitation. Two of the most common CMS programs are ACOs, in association with the Medicare Shared Savings Program, and the Bundled Payments for Care Improvement initiative.
Arguably, the most effective value-based care models specific to orthopedics are bundled payment arrangements for hip and knee replacement surgery. Participation in a bundled payment model can be through CMS (e.g., Bundled Payments for Care Improvement, Model 2), a commercial health insurance carrier, or a business entity. Commercial health insurers and businesses may contract directly with providers and healthcare organizations.
In the metropolitan area where I practice, there are opportunities for independent orthopedic surgeons and small orthopedic group practices to join a CMS ACO through a participating healthcare system. Physicians should consider compatibility, alignment, and financial strengths in the decision process. One large, free-standing orthopedic group in this region recently created a bundled care payment model for hip and knee replacement surgery that was approved by CMS. Their value-based care program includes a preoperative evaluation, patient-centric education, surgery and hospital care, postoperative monitoring, and rehabilitation services.
Effective value-based care models in orthopedics require a receptive ear to what works and what does not work. Provider engagement with payer sources is crucial. In 2017, CMS encountered pushback on the mandatory Comprehensive Care for Joint Replacement model from providers who expressed concerns about hospital readiness and practice sustainability. The number of mandatory geographic areas in this model was subsequently halved and rules on participation were softened. In the same final CMS rule, the agency canceled a mandatory bundled payment model for hip fractures due to concerns raised by orthopedists and other care providers.
Creative value-based care models are being continually designed and implemented, and existing models are being modified by the CMS Center for Medicare & Medicaid Innovation. The Center for Medicare & Medicaid Innovation is a diverse group of knowledgeable and experienced individuals who are receptive to input from the Physician-Focused Payment Model Technical Advisory Committee and other stakeholders in healthcare.
Q: Where are the most significant opportunities to deliver higher value care in orthopedics?
DK: There are several opportunities in orthopedics to deliver superior value-based care. Targeting specific procedures of high volume is one strategy. In addition to bundled payment models for elective hip and knee replacement surgery, bundled payment models may conceivably be created for other common orthopedic procedures such as shoulder arthroplasty, elective ligament reconstruction in the knee, and wrist fracture repair. Bundled payment models for trauma, however, present a challenge given the wide spectrum of patient injuries and comorbidities that may adversely influence costs and outcomes.
Another strategy involves targeting specific diseases. Dr. Kevin Bozic, an orthopedic surgeon and chair of surgery and perioperative care at the Dell Medical School at UT Austin, is a well-known leader in value-based care payment and delivery models. His group has embraced opportunities to improve value in degenerative joint disease in the hip and knee outside of simply improving the efficiency of joint replacement surgeries. Through coordinated team efforts (surgeon, advanced practice nurse, physical therapist, nutritionist, behavioral health-trained social worker and others), they achieved improvements in patient-reported outcomes for both operative and nonoperative patients, in addition to a reduced length of stay in patients who underwent surgery.
Q: How do you see value-based care evolving for orthopedics? Do you see it becoming the standard in the future?
DK: Value-based payment models will arguably improve the quality of orthopedic care while lowering the costs of care. One recognized concern involves the validity of tools used for measuring the quality of care provided and patient outcomes. Regardless, value-based reimbursement models applicable to orthopedists involved in the care of a population of people, a specific disease, and/or a specific procedure are a lasting realty. In the NEJM Catalyst Insights Council survey from July 2018, 42 percent of respondents opined that value-based reimbursement models will be the primary revenue model for U.S. healthcare in the future. I believe this to be true, regardless of potential legislative changes to government payer programs. Elements of value-based care will carry forward.
Q: What is your best advice for small and mid-sized orthopedic groups to prepare for value-based initiatives?
DK: For independent practitioners and small to mid-sized group practices interested in pursuing participation in one or more value-based reimbursement models, I would recommend contacting the administrator of a larger orthopedic group in the practice area. In addition, hospitals and healthcare systems in the practice region may have a value-based care team to provide information on physicians partnering with their ACO. Adopting a common electronic health care record system, assessing regulatory issues, and determining if participation in the model is actuarial sound from reimbursement and risk perspectives are important. Working closely in teams and partnerships with other clinicians and service providers will be imperative.
There are several commercial consulting services specializing in value-based care; however, the assistance offered may be more applicable to larger orthopedic groups, hospitals and hospital systems. For practitioners planning to participate or already participating in a CMS ACO, payment terms may change with the recent push toward increased provider accountability and adoption of two-sided risk models.
Value-based care concepts are relatively new to most of us as orthopedic surgeons. The CMS models evolved from the Affordable Care Act of 2010 and were expanded with passage of the Medicare Access and CHIP Reauthorization Act of 2015. Commercial insurers are following the lead of CMS. The information and infrastructure requirements can be daunting, particularly in light of numerous other advances in the practice of medicine that have occurred over the past decade.
The American Medical Association and the American Academy of Orthopaedic Surgeons provide excellent web-based resources for general and orthopedic-specific information on value-based care. The CMS website provides abundant background information, in addition to a listing of approved CMS models and participation requirements. Furthermore, there are several organizations that offer seminars throughout the year on value-based care (e.g., Health Care Payment Learning & Action Network, Interdisciplinary Conference on Orthopedic Value-Based Care).
David M. Kalainov, MD
Clinical Professor of Orthopaedic Surgery
Northwestern University Feinberg School of Medicine
Chicago, IL
dkalaino@nm.org
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For a deeper dive into the future of orthopedics, attend the Becker's 17th Annual Future of Spine + Spine, Orthopedic & Pain Management-Driven ASC in Chicago, June 13-5, 2019. Click here to learn more and register.