Medicare is trying to change the way it pays for total joint replacements, particularly hip and knee replacements. Currently, Medicare pays a bill for each individual aspect of a patient’s care. It’s kind of luck shopping a la carte. They pay the surgeon, the hospital, the anesthesiologist, the rehab facility for after the patient leaves the hospital, and the list goes on. If the patients has a complication and requires more treatment then Medicare pays for that also.

Medicare is currently transitioning towards “bundled payment” models. In these situations Medicare pays a fixed amount for the entire care package. These programs are beginning to roll out nationwide, and in general it seems like a good idea. However, we are all ready starting to see one significant unintended consequence of this approach. Less healthy patients are going to have a harder time finding doctors to care for them.

“Why is that?” Simply put, patients who have medical problems are more expensive to take care for. A patient with heart disease is more likely to stay longer in the hospital after surgery. Obese patients are more likely to have complications such as infection. Diabetic patients are also more likely to have complications. It costs more money to care for these patients, but under bundled payment models the hospital is paid the same amount regardless of how sick or complex the patient is. Furthermore, hospitals and doctors are “scored” based on how cheaply they can provide the medical care. Medicare then rewards or punishes the doctor based on these scores in the form of payments. As a results, many doctors and hospitals will not want to provide joint replacements to sicker patients for fear that it will affect their score. I have personally already begun to see this happening in our area.

For a long time we have been hearing that Medicare bundled payments are coming. Well, now they are here. Soon we will see what unintended consequences they drag along. The first will be limited access to joint replacement for sicker patients.