Hospital and Surgeon Medicare Reimbursement Trends for Total Joint Arthroplasty

Abstract

Background: Over 1 million total joint arthroplasties (TJAs) are performed every year in the United States, creating Medicare cost concerns for policy makers. The purpose of this study is to evaluate recent trends in Medicare utilization and reimbursements to hospitals/surgeons for TJAs between 2012 and 2017.

Methods: We tracked annual Medicare claims and payments to TJA surgeons using publicly available Medicare databases and aggregated data at the county level. Descriptive statistics and multivariate regression models were used to evaluate trends in procedure volume, utilization (per 10,000 Medicare beneficiaries), and reimbursement rates and to examine associations between county-specific variables and TJA utilization and reimbursements.

Results: Between 2012 and 2017, there was an 18.9% increase in annual primary TJA volume (357,500 cases in 2012 to 425,028 cases in 2017) and a 2.0% increase in annual primary TJA per capita utilization (73.4 cases per 10,000 Medicare beneficiaries in 2012 to 74.8 in 2017). The Midwest and the South had higher utilization rates compared with the Northeast and West (P < .001). Utilization rates for primary TJA procedures also had a significant negative association with the poverty rate (P < .001). Medicare Part B payments to surgeons fell by 7.5%, equivalent to a 14.9% inflation-adjusted decline, whereas hospital reimbursements and charges increased by 0.3% and 18.6%, respectively, during the study period.

Conclusions: Despite increasing TJA volume and utilization, surgeon reimbursements have continued to decline, whereas hospital payments and hospital charges have increased significantly more than surgeon charges. Cost containment efforts will need to address other expenditures such as hospital costs and implant costs to better align financial risks and incentives for TJA surgeons.

Keywords: Health-care costs; Medicare; Reimbursements; Total joint arthroplasty; Utilization.

Figure 1

TJA average utilization by state (procedures per 10,000 Medicare beneficiaries).

Figure 2

State density of TJA surgeons (per 1 million Medicare beneficiaries).