How Can Value-Based Care Improve in Orthopedics?


This article originally appeared in Becker’s Spine Review on September 30, 2021.

Question: How can value-based care become more effective in orthopedics?

David Jacofsky, MD: Initially, orthopedics was a leading specialty in value-based care models. Bundled payments, which are well-suited for the episodic nature of certain acute orthopedic diagnoses, provided a platform to engage musculoskeletal providers. However, due to pricing differences between facilities in the same market and the unsustainable nature of annually declining price targets with diminishing financial opportunities for providers, there have been a number of unintended consequences that have decreased enthusiasm for acute care bundles among providers and conveners. The best models to drive long-term performance and meaningfully bend the cost curve will be those models that accomplish three goals.

First, models must align all stakeholders in the market for the long term. These models should align payers, providers and facilities. Second, models must recognize the current trend in spend and work to reduce the trend for the total cost of care, rather than drive a “race to the bottom” on simple episode price. Finally, effective models must not only incentivize episode-based savings, but also must reward providers for appropriate indications for interventions, medical optimization efforts, and prevention and wellness activities.

Bundles may effectively lower the “per unit” price for an episode, but this has no impact on managing the number of appropriate episodes in a market, decreasing unnecessary bundles, nor does it engage providers in preventive care. Population health models that are diagnosis- or condition-based will be far more effective at both driving down care cost and eliminating waste while simultaneously improving provider engagement in activities that focus on wellness instead of primarily managing sickness. This would be a win-win-win for all stakeholders involved.

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