Purpose of review: This paper reviews the history and structure of Medicare reimbursement with a focus on aspects relevant to the field of orthopedic surgery. Namely, this includes Parts A and B, with particular attention paid to the origins of Diagnosis Related Groups (DRG) and the physician fee schedule, respectively. We then review newer policies affecting orthopedic surgeons.
Recent findings: Recent Medicare reforms relevant to our field include readmission penalties, the evolution of bundled payments including the mandatory Comprehensive Care for Joint Replacement (CJR) and Surgical Hip and Femur Fracture Treatment (SHFFT) programs, and the new mandatory Merit-based Incentive Payment System (MIPS) pay-for-performance program. Providers are facing an increasingly complex payment system and are required to assume growing levels of financial risk. Physicians and practices who prepare for these changes will likely fare best and may even benefit.
Keywords: Bundled payments; Healthcare reform; Medicare; Merit-based incentive payment system (MIPS); Orthopedic surgery; Reimbursement.