Several weeks ago, I was fortunate enough to attend a meeting at the Association of American Medical Colleges (AAMC) on a new mandatory payment model for joint replacement. I was the only resident physician among the more than 70 health professionals at the meeting. What I learned is that for most trainees in medical school and residency, little time is spent understanding the nuances of health care finance or practice management.
At some point, we will all start our own practices, and the clinical decisions we make will have direct financial impact on our patients, our practice, and ourselves. Many of us are prepared to survive in a system utilizing fee-for-service reimbursement models that we have experienced in training. However, the world of health care finance is changing. With increasing pressures to control cost, payers are responding by developing new models of reimbursement. With an aging population, Medicare is seeing an ever-increasing cost burden and the Centers for Medicare & Medicaid Services (CMS) is seeking ways to control costs while continuing to provide essential patient services. This necessitates creative new reimbursement models that promote cost control and consistent, quality patient care. The Comprehensive Care for Joint Replacement Model (CCJR) is one such example that has been proposed by CMS. CCJR is centered on a bundled payment to a hospital for a total joint replacement and the subsequent 90 days of care with the goal of incentivizing hospitals and physicians to control cost and improve perioperative care. Such a model shifts risk from the payer (CMS) to the providers of care.
As medical students and residents, the majority of our training is spent obtaining the knowledge and skills necessary to effectively treat patients in our chosen specialty. Little, if any, time is spent on learning about practice management, or reimbursement models, and how they impact the care we spend so much time learning how to deliver. This is an unfortunate shortcoming of our current medical education. We should be demanding that our faculty and trainees gain knowledge of these emerging models that are directly influencing our practices.
The CCJR model provides an excellent opportunity to reflect on the downstream consequences of payment models for our health systems. In a fee-based reimbursement model, volume is incentivized and implant cost, physician fees, hospital stay, rehabilitation, and other medical services are all billed on an individual basis. In a bundled repayment model where 90-day episode costs must be accounted for, attention must be paid to a wider variety of cost control and quality of care measures as the surgeon and hospital assume much higher risk. The bundled payment reconciles historical baseline costs with actual costs, and health systems must either pay CMS excess episode costs or may generate savings if they more efficiently delivered care. In the bundled payment world, more extensive collaborative care with anesthesiologists and primary care providers can better optimize preoperative medical care. Postoperative rehabilitation and medical care may need to be focused on better preparing patients for a discharge home. More intensive postoperative care plans may need to be implemented for patients to minimize their postoperative medical or surgical complications. Access to more extensive home health care resources may need to be developed. Graduating resident orthopaedic surgeons planning to perform total hip and total knee replacements could be ill-prepared to develop a sustainable practice without a sound understanding of this emerging model. This is but a single example in a single specialty. Every medical specialty will see changes in their practices as payers develop new reimbursement models.
Educating residents and students on upcoming changes to payment models is in the direct interest of practicing physicians in academic practices as well. Resident physicians and medical students help deliver medical care in the operating room and on call every day throughout the country. It is vital for resident physicians to have the skills and knowledge necessary to provide excellent and cost-effective patient care. Our knowledge of historical and emerging reimbursement models will allow us to be more proactive and influential in the evolution of these systems. In addition, being aware of the influence of reimbursement models on our ability to provide effective, appropriate patient care allows us to be better prepared to advocate for our patients and our practices.
There is little doubt that physicians must play an active role in reducing health care costs and improving patient care, and we must become engaged early in our medical education. We must be able to influence, instead of react to, the ever-changing environment of our health care system.