Understanding the costs of procedures and working with community resources will be more important than ever for orthopedic surgeons facing challenges with Medicare reimbursements, Steve Lucey, MD, said.
Dr. Lucey, who co-founded Valere Bundled Solutions, joined the "Becker's Spine and Orthopedic Podcast" to talk about the future of Medicare payments for surgeons and the benefits of accountable care organizations.
Note: This is an edited excerpt. Listen to the full conversation here.
Question: How close are you to that line where it's really unfeasible to take any more cuts or absorb any more of the cost reductions?
Dr. Steve Lucey: One part of that answer is, I know exactly how much it costs. I know exactly how much it costs for me to do a Medicare total knee at an outpatient surgical center — what my fee is, how much the implant costs, how much physical therapy costs. The problem is that's for the best case scenario with a very healthy patient. But that's not every patient. The federal government needs to recognize that not only is that it's a good target, but you have to pay us to do it. You have to pay for a surgeon like me to do the surgery, and what they're paying us now is not even adequate. There already are surgeons who are just not accepting Medicare, and if that happens, what's the point of all of this? How are people supposed to have their surgery done if people are no longer accepting Medicare? We do know the costs, but we also know how much you know we should be paid, and so there'll be a standoff here in the next decade for sure before we start seeing some really long lines for joint replacement.
Q: What advice do you have for other physicians who are looking to take advantage of some of this information in the bundled payment program. How are you continuing to maximize those efforts?
SL: If you have an accountable care organization in your community, you should reach out and you should sit down and talk about how to inline incentives to create a value-based care play with these types of scenarios with joint replacement. It's a very high cost episode. It's the number one spend of Medicare hip and knee replacement. If you have an ACO in your community, you need to reach out. We're happy to help you have that conversation with them and give you advice and some historical perspective.
The second thing I would tell the joint replacement surgeons out there is, you need to know your spend. You need to know your outcomes. There will come a time where companies around the country who are not going to pay for insurance for their employers, they're going to be self-insured. That's a very fast growing market, and they will want to know how much it costs for you to do a hip or a knee replacement. You need to know those numbers, and you need to build those direct to employer bundles. You just at least need to become a businessman and know your outcomes, you need to know your costs, and that's just going to be the way of the future.