Medicare’s Bundled Payment Program–Does it Change Hospital Volume or Case Mix?

MedicalResearch.com Interview with:

Amol Navathe, MD, PhD Assistant Professor, Health Policy and Medicine Perelman School of Medicine Penn Leonard Davis Institute of Health Economics

Dr. Navathe

Amol Navathe, MD, PhD
Assistant Professor, Health Policy and Medicine
Perelman School of Medicine
Penn Leonard Davis Institute of Health Economics

MedicalResearch.com: What is the background for this study? What are the main findings?

Response: Medicare’s voluntary Bundled Payments for Care Improvement (BPCI) initiative for lower extremity joint replacement (LEJR) surgery has been associated with reduced episode spending and stable-to-improved quality. However, BPCI may create unintended effects by prompting participating hospitals to increase the overall volume of episodes covered by Medicare. This could potentially eliminate Medicare-related savings or prompt hospitals to shift case mix to lower-risk patients.

Among the Medicare beneficiaries who underwent LEJR, BPCI participation was not significantly associated with a change in market-level volume (difference-in-differences estimate . In non-BPCI markets, the mean quarterly market volume increased 3.8% from 3.8 episodes per 1000 beneficiaries before BPCI to 3.9 episodes per 1000 beneficiaries after BPCI was launched. In BPCI markets, the mean quarterly market volume increased 4.4% from 3.6 episodes per 1000 beneficiaries before BPCI to 3.8 episodes per 1000 beneficiaries after BPCI was launched.

The adjusted difference-in-differences estimate between the market types was 0.32%. Among 20 demographic, socioeconomic, clinical, and utilization factors, BPCI participation was associated with changes in hospital-level case mix for only one factor, prior skilled nursing facility use in BPCI vs. non-BPCI markets.  Continue reading