The Implications of Aging Population Demographics on the Delivery of Primary Total Joint Arthroplasty in a Bundled Payment System.
Academic Article
Overview
abstract
BACKGROUND: The Centers for Medicare & Medicaid Services (CMS)'s Bundled Payments for Care Improvement (BPCI) program provides a set payment for the provision of primary total joint arthroplasty (TJA) care regardless of age and risk factors. Published literature indicates that the cost of care per episode of TJA increases with age. We examined the implication of this relationship and the effect of projected changes of age demographics on our center's BPCI experience. METHODS: A retrospective review of prospectively collected data on 1,662 Medicare BPCI patients undergoing primary total knee arthroplasty (TKA) and total hip arthroplasty (THA) from 2013 to 2016 at a single orthopaedic institution was performed. The relationship between age and cost of care was first determined in our analysis of our BPCI experience. We then performed a cost analysis by age group with respect to our institution's profit or loss per episode of care. A forecast for shifting age demographics in our region, modeled by the U.S. Census Bureau's Federal-State Cooperative for Population Estimates (FSCPE) and Projections (FSCPP), was used to evaluate the financial implications for our BPCI program. RESULTS: Our institution sustains a significant loss of $1,934 (p < 0.001) per case for patients 85 to 99 years of age, which is offset by profits associated with treating patients in younger age groups. This age group (85 to 99 years of age) will double by the year 2040 in our region, whereas the youngest age group (65 to 69 years of age) is projected to marginally increase by 12%. The average cost of care per primary TJA will rise because of the predicted shifting age demographics, compounded by an estimated 3% inflation rate. Utilizing the current BPCI reimbursement rate, we project an inflection point of declining profits after the year 2030 with the given projections for our regional population. CONCLUSIONS: The regional population served by our institution is aging. This shift will lead to an increased cost of care and diminishing profits for TJA after 2030. The CMS's BPCI initiative and novel alternative payment models (APMs) should consider age as a modifier for reimbursement to incentivize care for the vulnerable and older age groups. CLINICAL RELEVANCE: The findings of the present study are clinically relevant for decision-making regarding the allocation of resources in the setting of an aging population.
