How Virtual PT Helps Orthopedic Providers Seize the Potential of Bundled Payments

Why Virtual PT Is Uniquely Positioned to Maximize the Value of the BPCI Advanced Model for Joint Replacement Care Providers

Though just a few years old, Medicare’s bundled payments care initiative is reverberating loudly throughout the healthcare industry, providing an incentive (sometimes voluntary, sometimes not) for organizations to streamline care and shift successfully to value-based delivery.

Specifically, the Comprehensive Care for Joint Replacement (CJR) and Bundled Payments for Care Improvement (BPCI) Advanced initiatives have included more hip and knee (or lower extremity joint/LEJR) replacement processes to the ongoing bundled care initiative, including major joint replacement of the upper and lower extremities and double joint replacement of the lower extremity.

The idea is to accelerate the shift to value-based care in an area that badly needs it. “Hip and knee replacements are the most common inpatient surgery for Medicare beneficiaries and can require lengthy recovery and rehabilitation periods,” as noted by the website for the Centers for Medicare & Medicaid Services (CMS) (which also happens to be the nation’s single largest healthcare payer).

“In 2014, there were more than 400,000 procedures, costing more than $7 billion for the hospitalizations alone,” the CMS adds. “Despite the high volume of these surgeries, quality and costs of care for these hip and knee replacement surgeries still vary greatly among providers.”

Consider also that this is a rapidly growing industry — one study projects a 174% increase in demand for primary total hip arthroplasties and a 673% increase for primary total knee arthroplasties by 2030. There’s a real need, then, to not only bring down the costs of joint-replacement hospitalizations, but also standardize the quality of care among the varying types of facilities that provide post-acute care.

‘A Direct Financial Reward for Physicians’

Created to help provide a more direct line to value-based (as opposed to fee-based) care, the new initiatives from the CMS are designed to consolidate all payments associated with a single episode of care, including not just the replacement surgery but also any and all post-operative care, such as evaluations, x-rays, and physical therapy rehabilitation.

The upshot? Instead of a fragmented series of radiology labs, home care facilities, outpatient PT centers, and any other services associated with joint replacement care, a single party now assumes risk for every stage of care — but also reaps every financial reward, as well.

Some entrepreneurial physicians have been quick to see the potential here: In traditional total joint replacement models, doctors receive around six percent of the total 90-day episode, despite the impactful role they play. With bundled payments, physicians may take on all the risk — but they also receive all of the rewards (as well as more control over the wellbeing of their patients).

Bundled payments also offer the opportunity to standardize care by bringing the entire episode under the supervision (and quality standards) of a single party. Under the fee-for-service model, each service is billed separately and with little oversight, explains Peter Ubel at Forbes, “meaning inefficient providers might take more x-rays than necessary, or keep patients in rehab hospitals longer than they needed such comprehensive care, and be rewarded for this inefficiency by receiving additional payments.”

With bundled payments, physicians willing to do the administrative legwork of securing downstream contracts for all related services can ensure new levels of care and satisfaction. Writing in Modern Healthcare, Harris Meyer calls these operational improvements “fine-tuning the entire episode of care."

"One of the nice things about bundled payment is it can provide a direct financial reward for physicians to work hard on aspects of care that can be difficult and require coordination with the hospital,” as the University of Pennsylvania’s Dr. Amol Navathe told Meyer. “It's important that physicians be engaged and bought in.”

How Bundled Payments Empowers the Physician-Run Practice

Across the United States, a handful of physician groups have already seized this opportunity to take greater oversight of post-surgical care to create a new kind of practice. Take, for instance, the Delta Joint Management Group, a new practice formed by four orthopedic surgeons in Greensboro, North Carolina who have opted to manage the entire post-operative process themselves. 

As early adopters of BPCI, the physicians behind Delta quickly saw the value of joint replacement bundles within a commercial outpatient setting, and how that value could be achieved by focusing on the patient. By setting up a sole convener known as Valere Bundled Solutions, they were able to build a new type of practice and business model that let them ensure the highest standards of care throughout each stage of a patient’s journey.

“As a treating physician, it's important to me that I have visibility into how a patient is doing after surgery,” says orthopedic surgeon and Delta co-founder Dr. Stephen Lucey. "We're always looking for ways to improve patient outcomes, reduce costs and increase value to the healthcare system.”

In so doing, they’ve positively impacted their bottom line, as have other groups. Ubel points to early results showing that the bundled payments model can reduce the cost of knee replacements by an average of almost $1,200 per procedure. Other examples showed significantly fewer readmissions and EM visits, and double-digit decreases in stay times in rehab and skilled-nursing facilities — with every saved penny going to the sole convener. 

So successful has Delta’s model of care been that the physicians’ convener group, Valere Bundled Solutions, now serves as a consultant to other physician groups looking to do the same. Valere shares their successful model with “guidance, best practices and standardization that will expedite your transition to a bundled outpatient model of care.”

The result is an exciting new stage in care delivery, with bundled payments serving as “a whole new avenue of medicine,” according to Dr. Frank Aluisio, one of Delta’s founding physicians. “It’s probably one of the first things ever that will simultaneously improve the patient experience, improve patient outcomes, and yet, operate at a far lower cost than what’s going on now.”

How Virtual PT Can Help Fulfill the Bundled Payments Continuum

Dr. Aluisio’s sentiments have been echoed in other quarters, as other doctors and administrators “involved in bundled-payment programs for total joint replacement say they're impressed with how the programs have engaged physicians to produce lower costs and better outcomes,” as Meyer writes.

The drive to standardize care while also reducing third-party expenses is leading many bundled payments joint replacement providers to adopt telehealth services. With its ability to empower clinicians and managers to oversee more patients more efficiently, virtual PT has the potential to dramatically improve the rehabilitation process at a time when those improvements are badly needed.

Speaking of our own Virtual Exercise Rehabilitation Assistant (VERA™), a study published in the Journal of Knee Surgery found it to be a telerehabilitation platform that “offers the advantage of cost savings, convenience, at-home monitoring, and coordination of care, all of which are geared to improve adherence and overall patient satisfaction.”

That’s not all: “Additionally, the biometric data can be used to develop custom physical therapy regimens to assure proper rehabilitation, which is lacking in other telerehabilitation applications that use noninteractive videos that can be watched on mobile devices and tablets.”

Better still, VERA is designed to integrate seamlessly with BPCI, with Xconomy recently pointing out how it provides an efficient, patient-friendly way to fill in the post-rehab side of the bundled payments equation. (VERA also gives organizations the chance to boost patient satisfaction scores; at 87, VERA’s NPS exceeds the averages for healthcare, education and technology.)

‘Improving Value’ with Virtual Physical Therapy

Delta, for its part, seems on pace to deliver the same level of satisfaction, thanks to its innovative and entrepreneurial approach to bundled payments joint replacement care.

“In our first year, the level of patient and surgeon satisfaction was tremendous,” Dr. Aluisio told us. “We had zero hospital readmissions, and no significant complications. Based on our initial experience, we feel that we have provided higher value care to our patients by providing equivalent or better-quality results at lower costs.”

And the prospect of virtual physical therapy fits that model to a tee. To that end, Delta recently announced its decision to utilize VERA to optimize its post-acute process for commercial bundles, with co-founder Dr. Stephen Lucey citing the platform’s power to expand its reach to new patients.

“Reflexion Health’s VERA technology is intuitive, smart and patient-friendly,” Dr. Lucey added, pointing out how VERA provides insight into patient recovery “even when my patients are one or two states away — increasing our potential footprint as a practice and our ability to help patients near and far.”

“Now that we’ve found our model to be a safe way to do outpatient arthroplasty, and patient satisfaction is high, we’re looking at ways to improve the value,” added Dr. Aluisio. “We’ve seen the effectiveness of virtual therapy … the next stage will be looking for further ways to improve the patients’ experience after the surgery.”

Get more insider’s insights into how virtual physical therapy can help your organization seize the true potential of the bundled payments model: Contact us today to schedule your complimentary consultation.