Medicare Payments to Hospitals and Physicians for Total Hip and Knee Arthroplasty Declined From 2009 to 2019

Abstract

Background: Recent research has reported hospital payments for total hip arthroplasty (THA) and knee arthroplasty (TKA) from commercial payers to be increasing, despite increasing price pressure from the increasing scale and scope of alternative reimbursement schemes. Therefore, the primary objective of this study was to analyze the recent trends in Medicare payments to hospitals and surgeons for primary THA and TKA.

Methods: The primary data source for this study was the Medicare Provider Analysis and Review Limited Data Set (MEDPAR) for the years 2009, 2014, and 2019. A total of 331,721 patients undergoing primary elective THA and 742,476 patients undergoing primary elective TKA were included. Total Medicare payments and total hospital reimbursements, which included Medicare payments and patient copayments, were calculated. Physician fees were obtained from the Medicare physician fee schedule (MPFS) look-up tool. All financial data were inflation-adjusted. Patient comorbidities were identified as a measure of health status. The data were stratified by year and analyzed using descriptive statistics.

Results: From 2009 to 2019, inflation-adjusted Medicare payments declined by 11.5% and total hospital reimbursements (Medicare payments plus copayments) declined by 6.5% for THA, while Medicare payments declined by 13.4%, and total hospital reimbursements declined by 7.7% for TKA. Over the same period, surgeons' fees declined by 13.1% for THA and 18.9% for TKA.

Conclusion: From 2009 to 2019, Medicare payments to hospitals and physicians declined markedly. Physician payments decreased faster than hospital payments. These results may have implications for the future viability of performing THA and TKA on Medicare patients.

Keywords: Medicare; payments; reimbursement; total hip arthroplasty; total knee arthroplasty.