October 16, 2018
3 min read

Systematic approach to episode of care requires physician insight

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Despite efforts to control the price of procedures, implants and physician reimbursement, health care costs continue to increase. According to 2016-2025 Projections of National Health Expenditures Data from CMS, the U.S. spends $3.4 trillion on health care. This has now reached 17.8% of gross domestic product, which is projected to increase to 19.9% by 2025. There is constant pressure on all components of health care to control cost.

For orthopedic surgeons, the pressure to control costs affects every aspect of patient care. The federal government and insurance companies have lowered reimbursement rates, so we are paid less for the same work we used to do. Added requirements for documentation further increase the amount of uncompensated time. Implants and devices are managed by the facilities and may be removed from treatment plans if they fail to meet price points or costs of similar products. We have less support from social services, and prescribed rehabilitation programs are often cut short by arbitrary restrictions on approved visits. Yet in the end, we remain responsible for outcomes and patient satisfaction.

Anthony A. Romeo, MD
Anthony A. Romeo

Evidence-based options

Virani and colleagues found that when evaluating an entire epidose of care, the contribution of the surgeon to the overall cost is less than 10%. Reducing physician reimbursement will have a minor effect on the overall cost, however, it will have a major negative effect on professional satisfaction and desire to continue to perform these procedures. Logically, if the entire episode of care could be managed consistently with mostly evidence-based options, then costs should be reduced for each episode and reduce the expensive risk of complications and readmissions.

The leadership on cost containment and management of the entire episode of care for orthopedic conditions is currently divided between physician-led organizations and hospital administrator-led organizations. With the drive to move more procedures into the outpatient setting, another site of intense competition is the ASC. Patient-matching to the most appropriate, cost-efficient surgical site is critical to provide valuable care. Incentives for hospitals to move cases to outpatient surgery centers have not aligned with revenue projections as they have been able to command higher reimbursement in the hospital setting, whether the procedure is performed as an inpatient or outpatient.

Outpatient surgery

Political pressure from hospital associations and hospital administrations has been applied toward government leaders and employed physicians. This has delayed the full movement of total joint arthroplasty off the CMS hospital inpatient-only list, although knee arthroplasty was removed from the list this year. Outpatient TJA has been successfully conducted at major medical centers and private practice centers in the U.S. for more than a decade with growing evidence of its safety, efficacy and similar or better outcomes. There is no patient-based or evidence-based reason that carefully selected patients should be prohibited from outpatient surgery. Political and financial incentives are gradually becoming less of an impasse with the inevitable progression to more cost-effective and value-based decisions.


At this time of transition to value-based health care where incentives are realigned from paying for procedures to paying for outcomes, orthopedic surgeons must be involved in decisions related to the total episode of care. A systematic approach to the episode of care, beginning with nonoperative treatment and progressing to final recovery after treatment, requires physician insight and cannot be delegated to administrators. The ability to define appropriate care, evidence-based when possible, delivered in the most efficient manner at the least expensive site matched to the patient’s health has great potential to reduce overall cost while achieving satisfactory patient outcomes.

Disclosure: Romeo reports he receives royalties, is on the speakers bureau, is a consultant and does contracted research for Arthrex; receives institutional grants from MLB; and receives institutional research support from Arthrex, Ossur, Smith & Nephew, ConMed Linvatec, Athletico and Wright Medical.