Abstract
Introduction
The Centers for Medicare and Medicaid Services (CMS) removed total knee arthroplasty (TKA) from inpatient-only status in 2018. Our goal was to measure the adoption of outpatient TKAs, the impact on re-treatment rates, and the economic implications for hospitals.
Methods
We utilized 100% national Medicare Part A fee-for-service (FFS) patient-level claims data for 2017–2018. We excluded DRG 469 TKAs since they are unlikely to be outpatient candidates, which left 257,107 primary TKAs in 2017 and 264,393 in 2018. We examined the time trend in monthly case volume and 30-day retreatment rate (defined as percent of patients having a second TKA within 30 days of the first. We calculated the loss in revenue for a hospital by multiplying the decrease in payment rate between inpatient and outpatient by the outpatient and total 2018 TKA volume.
Results
In 2017 0.2% of primary TKAs were performed outpatient. Following the rule change, 25% of cases were performed outpatient in Q1 2018. This stayed at 25% in Q2, increased to 27% in Q3, and then increased to 30% in Q4 2018. The 30-day re-treatment rate was 0.16% in 2017 and 0.15% in 2018. Across hospitals there was the following distribution in the decrease in payment rate from inpatient to outpatient TKAs in 2018: 10th percentile: $1,994, 25th: $2,612, 50th: $3,487, 75th: $4,918, 90th: $7,231. In 2018 outpatient TKA coding cost hospitals (saved CMS) $243M in Medicare FFS payments (an average of $89,000 per hospital). If all TKAs were performed outpatient hospital Medicare FFS payments would have been $965M lower ($353,000 per hospital) in 2018.
Conclusion
Outpatient TKA volumes grew through 2018. This did not impact 30-day retreatment rates. Medicare FFS payment rates declined by a median of $3,487 per outpatient case. As more TKAs are performed outpatient, total Medicare payments will further decline.
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