These are exciting but uncertain times for the field of orthopedics, particularly major joint replacements. As rapid changes in policy, sites of care and technologies (both for implants and ancillary products) reshape the landscape, health systems must act now to stay abreast of these developments in order to find continuing success.
While healthcare policy is subject to the whims and priorities of each election cycle, value-based care is clearly here to stay. Total joint replacement (TJR) provides a strong example. TJR is a commonly performed inpatient patient in the US, and ongoing CMS alternative payment models (APMs) have driven many hospitals to make reducing the cost of TLR a major priority. The early data indicate that these “bundled payments” have successfully reduced cost of care without negatively impacting clinical outcomes. Researchers in the Journal of the American Medical Association (JAMA) Internal Medicine reported in 2017 that hospitals were able to reduce total spending for patients undergoing joint replace by 20.8 percent with specific bundled payment models.
"One reliable estimate suggests that by 2025 nearly 300,000 hip and knee replacement procedures will be performed in outpatient settings, representing 20 percent of all procedures in the US"
Commercial payors as well as employers have also pursued “bundled payment” strategies through partnerships with health systems across the country. The large and increasing demand for TJR—an elective procedure with excellent outcomes and a low complication rate—makes itideal for this type of new payment model. Given that health systems receive one payment for the cost of the entire episode of care with a bundled payment, managing costs along the continuum of care is essential for the stakeholder “owning” the bundle.
Historically, total joint replacements have been performed almost exclusively in the inpatient setting. However, outpatient TJR is increasingin popularity, and with CMS recently removing total knee replacement from the “inpatient only” list, the outpatient shift will likely accelerate. One reliable estimate suggests that by 2025 nearly 300,000 hip and knee replacement procedures will be performed in outpatient settings, representing 20 percent of all procedures in the US.
Some large ambulatory surgery center networks have invested heavily in attracting orthopedic surgeons as well as patients to the outpatient setting. Meanwhile, patients are seeking out surgeons that perform outpatient procedures to avoid lengthy inpatient stays. To avoid losing significant volumes, health systems may need to adapt to these market changes by building, acquiring or partnering with ambulatory surgery centers. This comes at a cost— because total joint replacement surgery performed either in the hospital outpatient or ambulatory settingcomes with a significant reduction in reimbursement, another factor highlighting the importance of closely managing costs associated with these procedures.
As a result, forward-thinking health systems are using clinical evidence and data analytics to manage implant and ancillary technologies and collaborate with surgeons to better align business and clinical interests. This includes encouraging physicians to be conscious of the extra cost incurred by using “premium” technologies, and thoughtfully considering whether those technologies bring added value to the care that patient receives.
For example, take the growing popularity of ceramic femoral heads. Over 50 percent of all patients received a ceramic femoral head in 2016 according to data from the American Joint Replacement Registry, and that number will likely continue to increase. Ceramic heads also come at a substantial price premium compared to traditional cobalt chrome femoral heads, driving the total implant cost up by as much as 10percent or more.
But when we look at the clinical evidence, studies show similar clinical outcomes and reoperation rates but lower acetabular liner wear in ceramic-on-poly compared to metal-on-poly bearings, suggesting that metal-on-poly bearings may be appropriate in many cases, particularly for older or less active patients. However, many surgeons are putting ceramic heads in every patient, even when it may not be clinically necessary.
Clinical evidence can also help us understand when other high-priced implant technologies are warranted, such as mobile-bearing, cementless, antioxidant and oxidized zirconium (OXINIUM) technologies in knees, and dual-mobility and antioxidant technologies in hips.
In addition to the implants, “premium” ancillary products contribute significant cost to joint replacement procedures. Examples include antibiotic-loaded bone cement, bipolar sealers with saline (Aquamantys), custom cutting guides, computer-assisted surgery and robotics.
Robotics is particularly interesting because of the extremely high capital cost associated with its use, including annual service contracts and disposable products used for each case. Take the MAKO from Stryker as an example: The clinical evidence tells us that (1) its use generally results in longer operative time and (2) it has not consistently demonstrated meaningful improvements in clinical outcomes compared to traditional surgery. While MAKO’s improved accuracy for implant placement is promising, organizations should approach investment decisions with caution.
As health systems navigate the newly charted waters of value-based care and site-of-care shifts, they must use clinical evidence as a guiding light for sound decision making about orthopedics technology. By promoting the ongoing use of and reliance on clinical evidence with data, organizations can successfully provide valuable care to patients now and in the future.