Finding Value in New Perioperative Surgical Care and Payment Models

Perioperative care is highly fragmented and overly expensive, accounting for an estimated 52% of hospital admission costs in the U.S.

But that’s changing.

With the rise of value-based payment models, healthcare providers are leading new efforts to redesign care delivery processes. In perioperative care specifically, a group of physicians are making ground.

Since 2014, physicians from 88 community hospitals, academic medical centers, pediatric hospitals and physician groups across 32 states have worked together in a first-of-its-kind Learning Collaborative based on the American Society of Anesthesiologists’s Perioperative Surgical Home (PSH) model of care.

PSH is a patient-centered approach to surgery and includes a strong emphasis on shared decision making, rigorous process standardization, and evidence-based clinical care pathways, as well as robust coordination and integration of care. The PSH model guides patients through the entire surgical experience, from the decision to undergo surgery to 30 days post discharge and beyond.

Sound familiar? That’s because the PSH model is directly aligned with the concept of bundled payment and other value-based, alternative payment models (APMs), including value-based payment for surgical services through the Centers for Medicare & Medicaid Services’s (CMS’s) Bundled Payment for Care Improvement (BPCI) initiative, Medicare Accountable Care Organizations (ACOs) and the Comprehensive Care for Joint Replacement (CJR) model.

The focus of the PSH Learning Collaborative was initially on establishing an effective PSH team and re-engineering care processes across the entire acute care episode. And members have demonstrated significant improvements in quality, patient experience, post-acute care utilization, and the cost of care – citing readmissions reductions of up to 50%, a return on investment of up to 216% and increases in hip/knee arthroplasty patient discharges of up to 70%.

But today, members of the Collaborative are implementing new value-based APMs to support this work. More than half of the participants have established at least one APM and an additional 16% are in the process of developing a new APM. The most common payment models they’re participating in are CJR, BPCI, Medicare ACOs and Medical Directorship. Other payment models they’ve reported participation in include commercial shared savings arrangements, clinically integrated networks (CINs), Medicaid bundles, and co-management or hospital quality efficiency programs (HQEPs).

Additionally, CMS has approved the PSH for the Quality Payment Program's Merit-Based Incentive Payment System (MIPS) Improvement Activities (IAs), beginning in 2018. The PSH Care Coordination activity has also received the rare distinction of being eligible for the Advancing Care Information (ACI) bonus.

This is exactly how experimenting with and investing in new care delivery models is supposed to work. Redesigning care delivery processes, testing new models, and building on, spreading and scaling solutions is proving to be the most effective way to address the high cost of healthcare in the U.S. Through this model, those 88 healthcare organizations are better managing care, and reducing complications, readmissions and costs, while providing their patients with speedier recoveries. And now they’re being incented for it.

If we are to have any hope of improving overall healthcare quality and costs, we must accelerate, not slowdown, the transition to value-based care and payment models.

Have questions or interested in participating in the PSH Learning Collaborative? Contact Elyse_Pegler@PremierInc.com or click here.