Orthopedists uniquely positioned to guide value-based care
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Since the passage of the Affordable Care Act in 2010, CMS has sought to move away from fee-for-service payment models in favor of value-based payment models with an emphasis on incentivizing value delivered to payments.
In contrast to fee-for-service payment models, Kevin J. Bozic, MD, MBA, FACS, FAAOS, FAOA, chair of the department of surgery and perioperative care at Dell Medical School at the University of Texas at Austin and president of the American Academy of Orthopaedic Surgeons, said value-based care models incentivize innovation.
Source: Shawn Rocco/Duke Health
“In the fee-for-service payment model, as you innovate and become more efficient, your margins go down no matter what part of the health care system you are in,” Bozic told Healio | Orthopedics Today. “The [value-based care] framework is the opposite: it incentivizes innovation that produces health for patients.”
While the increased incentive to innovate in a value-based payment model could improve health equity by changing the way surgeons provide access and expand access, Christian A. Pean, MD, MS, assistant professor of orthopedic trauma and reconstruction surgery at Duke University School of Medicine, said there are not many mechanisms that incentivize surgeons to care for patients in disadvantaged populations.
“Many of our most underserved patients are in a payer plan that is not reimbursing enough for surgeons to make a comfortable margin and be incentivized to take care of those patients,” Pean said. “We have to push policymakers to incentivize population models that champion equity, that account for some of these social factors in care and we do need a more granular index for quantifying these factors.”
Alignment of incentives
Another conceptual benefit of value-based payment models is “the ability to align incentives across multiple stakeholders, patients, society, payers, health care organizations, delivery systems [and] health care providers,” according to Amol S. Navathe, MD, PhD, associate professor of medicine and health policy at the University of Pennsylvania and director of The Parity Center.
“Value-based payment offers an opportunity for incentive alignment and improvement on the efficiency and value of care,” Navathe told Healio | Orthopedics Today.
However, Adam Bruggeman, MD, chair of the Council on Advocacy for the American Academy of Orthopaedic Surgeons, said aligning incentives has been something that value-based payment models have lacked in practice.
“Right now, the way the value-based care systems are designed, they are not well designed to reward those surgeons for making the right decision financially and they are also not designed to put that risk on those surgeons,” Bruggeman said. “The challenge in value-based care is designing a value-based system that appropriately rewards the right decision to the right person.”
Fragmented care
Fragmented care also contributes to a lack of alignment within the health care ecosystem, according to Thorsten M. Seyler, MD, PhD, associate professor in the division of adult reconstruction at Duke University School of Medicine. While integrated university-based health systems have access to specialists in other medical fields, Seyler said private practices and smaller hospital systems do not have that advantage.
“You have your orthopedic practice, then you have your isolated primary care, you have perhaps an endocrinologist, maybe a neurologist or a different cardiologist,” he told Healio | Orthopedics Today. “The challenge there is communication, optimizing and trying to align everybody. For value-based care to work, fragmented care needs to go away and there has to be a way to interchange information.”
One driver of change for value-based payment models could be the implementation of condition-based bundles as opposed to procedure-based bundles, according to Bozic. While procedure-based bundles produced some value by having clinicians integrate across a 90-day episode of care, Bozic said it does not address the management of the orthopedic condition and the most appropriate treatment.
“You could have an efficient knee replacement, but if that did not help the patient improve their musculoskeletal health, you did not create value even though you had an efficient knee replacement that was done at a low cost in a low acuity center,” Bozic said. “The next iteration of value-based payment models that we are working on now are aligning value around the management of the condition.”
Condition-based bundles
Although condition-based bundles offer conceptual appeal by focusing on optimizing the management of the patient’s underlying condition, Navathe said condition-based bundles may lead to surgeons being overly conservative in the treatment of patients by performing more nonoperative treatment vs. operative treatment. He added another challenge revolves around how condition-based bundles interact with the broader value-based payment environment.
“On the one hand, I am a big fan of specialty-oriented bundles because we do not yet have good accountable care organization or global budget models that activate hospitals and specialists,” Navathe said. “But the flip side of that is, if we start to take a lot of chronic-condition bundles, then what is going to be leftover for an ACO or a large globally capitated provider to manage if we are piecing this all out to the specialists?”
He added, “My aspiration is that we would agree upon some structure of how we are going to approach value-based payments across the entire care continuum, including primary care, specialty care, hospitals [and] post-acute care, so that we can stimulate a more systematic delivery and payment system change.”
Definition of value
One common misconception with value-based payment models is the difficulty and mystification of defining “value,” according to Bozic.
“There is nothing magic as a clinical enterprise about focusing on optimizing a patient’s health as your primary goal in ways that, over time, reduce the cost of health care,” Bozic said. “Sometimes this gets caught up in this mythical term ‘value,’ and what does that mean? There is nothing magical or hard about making the primary focus improving health.”
He added, “If nothing else, if the value framework gets us to understand that the entire health care industry exists to produce health and then make that our focus, then that is a win.”
However, Bruggeman said definitions of value may differ depending on the health care entity.
“The problem is that, as a surgeon, what we think of as value-based care maybe does not match what the market is now using that term for,” Bruggeman told Healio | Orthopedics Today. “Instead of the primary purpose of value-based care being purely looking at the numbers, it is about providing the highest value care. That means operating on people who need to have surgery but not operating on people who do not need to have surgery. Then when you do the surgery, doing the right surgery for the right patient at the right time, which ultimately translates into cost savings. But sometimes we get messed up because when we think about value-based care, the term ‘value’ only applies to dollars instead of to the care that is provided.”
Metrics for outcomes
Another challenge for value-based payment models is the inability to measure outcomes accurately and succinctly, according to Navathe.
“You want to be able to measure the things that patients care about: how well they are walking, how pain-free they are [and] how much they can do the different activities that they want to do. Sometimes that is individualized,” Navathe said. “I would love to say that we have this huge infrastructure to collect this wonderful data, but it would not be true. There are some enclaves where we get better patient-reported outcome measure type data, but to be honest, it is quite costly and administratively burdensome to collect.”
He added, “Right now, the state of the art, in a sense, is still to use administrative claims data to track these outcomes. And we know that that is not the optimal way to do it.”
Even patient-reported outcome measures can obfuscate the true value of a physician’s work, according to Bruggeman.
“[Patient-reported outcome measures] can be heavily influenced by things that seem unrelated, like: Did my patient have to pay for parking to see me at the office? Did they have a long walk to get to my office once they got in the building? Was my staff kind and courteous to them?” Bruggeman said. “All of those things have an impact on how they report their outcomes and their satisfaction levels that do not always perfectly reflect the quality of the surgery, the value of that surgery or lack of surgery.”
Data transparency
Lack of data transparency can also be a deterrent for the expansion of value-based payment models, according to Seyler.
“What we are lacking right now is transparency at every single level,” Seyler said. “... Transparency ultimately drives quality. It creates accountability and leads to success in value-based care.”
Pean said a lack of data transparency tends to disadvantage smaller provider groups, while benefiting larger practices.
“Some of the administrative and data burden of enacting value-based care inherently disadvantages small provider groups and independent physicians,” Pean told Healio | Orthopedics Today. “To some extent, value-based care might be pushing consolidation, which can be problematic for numerous reasons. Obviously, as larger entities continue to chase margins, some of the transparency in how they select their patients to succeed in value-based care arrangements can get lost. That can certainly drive inequity in care.”
Policy
According to Bozic, one path to creating incentives based on value is policy and legislation.
“If we want to create the conditions for competition based on value, we have to have incentives, and that is where policy comes in,” Bozic said. “If we create incentives for competition based on value, then you are going to see more changes in the delivery system and in care delivery models, because, ultimately, creating value for patients is not an accounting exercise. It is not something that is done on the back end of a payment model. You have to change the way you deliver care to optimize value, and the only way you do that is by changing the care delivery model. But to do that, you need the incentives to be aligned. In the fee-for-service payment model, there is absolutely no incentive to try to optimize value for patients.”
Navathe said legislation is necessary to change the evidentiary standards which are potentially preventing practices from saving money.
“We need legislation to take models that have not met the most stringent levels of evidence,” Navathe said. “Hip and knee replacement surgery bundles have been shown to be cost efficient in that they reduce the cost overall from the perspective of equity and quality, but CMS has not met the true evidentiary standard to scale them as required by Congress.”
He added, “If you asked people in most business sectors: what is the evidentiary standard to scale something that might save billions of dollars? It is lower than the standard that Medicare is currently using, at least at the Office of the Actuary. To change that paradigm, it will take legislation.”
Another policy-related dilemma, according to Bruggeman, is the ability to contain the requirements for outcomes.
“It is critical that the way they write the bills and rules match what we can accomplish,” Bruggeman said. “If we do not do this right, our doctors will not have the right incentives that they can either achieve or that are big enough that they are interested in. Therefore, the surgeons will not participate and that will ultimately lead to low-value care as opposed to high-value care.”
Unique position
As a specialty, orthopedics presents a unique opportunity to move the needle for value-based care, according to Bozic.
“[Orthopedics] lends itself to competing based on what are the most effective treatments to improve function and reduce pain in the most cost-effective way. It is ideal,” Bozic told Healio | Orthopedics Today. “The other [reason] is, you are generally dealing with healthy patients that are motivated to improve their function. It is a shoppable service, so you can compete based on value.”
Pean said it is also a specialty uniquely positioned to tackle the challenges facing value-based payment models, with orthopedic surgeons well-suited to define value and quality of care.
“In orthopedic surgery, we have a unique opportunity to better characterize quality and give people credit for taking care of patients that have more issues affecting their outcome, and shifting the paradigm on what defines quality,” Pean said.
However, Bruggeman said the transition to value-based payment models that protects physicians while providing longevity to the entire health care system will take patience.
“If the health care system makes too much money, whether we are talking about insurance companies or the government, then we are going to basically kick out the doctors. If the doctors make too much money, we are going to bankrupt the system,” Bruggeman said. “There is a symbiosis that has to occur, but it is going to take some patience for us to find that perfect balance where doctors are still protected, but we are preserving the long-term health care system and providing the highest value care to patients.”
- References:
- Conrad DA, et al. Health Serv Res. 2015;doi:10.1111/1475-6773.12408.
- Mather RC, et al. J Shoulder Elbow Surg. 2013;doi:10.1016/j.jse.2013.10.007.
- Pean CA, et al. Bull Hosp Jt Dis (2013). 2022 Mar;80(1):102-106.
- Rosas S, et al. J Orthop Trauma. 2019;doi:10.1097/BOT.0000000000001452.
- Werner RM, et al. The future of value-based payment: A road map to 2030. Available at: https://ldi.upenn.edu/our-work/research-updates/the-future-of-value-based-payment-a-road-map-to-2030/. Published: Feb. 17, 2021. Accessed Dec. 11, 2023.
- For more information:
- Kevin J. Bozic, MD, MBA, FACS, FAAOS, FAOA, of Dell Medical School at University of Texas at Austin, can be reached at kevin.bozic@austin.utexas.edu.
- Adam Bruggeman, MD, of Texas Spine Center, can be reached at bruggeman.adam@gmail.com.
- Amol S. Navathe, MD, PhD, of University of Pennsylvania, can be reached at amol@pennmedicine.upenn.edu.
- Christian A. Pean, MD, MS, of Duke University School of Medicine, can be reached at alexis.porter@duke.edu.
- Thorsten M. Seyler, MD, PhD, of Duke University School of Medicine, can be reached at alexis.porter@duke.edu.
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