Association of the Mandatory Medicare Bundled Payment With Joint Replacement Outcomes in Hospitals With Disadvantaged Patients

IMPORTANCE: Medicare’s Comprehensive Care for Joint Replacement (CJR) model rewards or penalizes hospitals on the basis of meeting spending benchmarks that do not account for patients’ preexisting social and medical complexity or high expenses associated with serving disadvantaged populations such as dual-eligible patients (ie, those enrolled in both Medicare and Medicaid). The CJR model may have different implications for hospitals serving a high percentage of dual-eligible patients (termed high-dual) and hospitals serving a low percentage of dual-eligible patients (termed low-dual). OBJECTIVE: To examine changes associated with the CJR model among high-dual or low-dual hospitals in 2016 to 2017. DESIGN, SETTING, AND PARTICIPANTS: This cohort study comprised 3 analyses of high-dual or low-dual hospitals (n = 1165) serving patients with hip or knee joint replacements (n = 768 224) in 67 treatment metropolitan statistical areas (MSAs) selected for CJR participation and 103 control MSAs. The study used Medicare claims data and public reports from 2012 to 2017. Data analysis was conducted from February 1, 2019, to August 31, 2019. EXPOSURES: The CJR model holds participating hospitals accountable for the spending and quality of care during care episodes for patients with hip or knee joint replacement, including hospitalization and 90 days after discharge. MAIN OUTCOMES AND MEASURES: The primary outcomes were total episode spending, discharge to institutional postacute care facility, and readmission within the 90-day postdischarge period; bonus and penalty payments for each hospital; and reductions in per-episode spending required to receive a bonus for each hospital. RESULTS: In total, 1165 hospitals (291 high-dual and 874 low-dual) and 768 224 patients with joint replacement (494 013 women [64.3%]; mean [SD] age, 76 [7] years) were included. An episode-level triple-difference analysis indicated that total spending under the CJR model decreased at high-dual hospitals (by $851; 95% CI, –$1556 to –$146; P = .02) and low-dual hospitals (by $567; 95% CI, –$933 to –$202; P = .003). The size of decreases did not differ between the 2 groups (difference, –$284; 95% CI, –$981 to $413; P = .42). Discharge to institutional postacute care settings and readmission did not change among both hospital groups. High-dual hospitals were less likely to receive a bonus compared with low-dual hospitals (40.3% vs 59.1% in 2016; 56.9% vs 76.0% in 2017). To receive a bonus, high-dual hospitals would be required to reduce spending by $887 to $2231 per episode, compared with only $89 to $215 for low-dual hospitals. CONCLUSIONS AND RELEVANCE: The study found that high- and low-dual hospitals made changes in care after CJR implementation, and the magnitude of these changes did not differ between the 2 groups. However, high-dual hospitals were less likely to receive a bonus for spending cuts. Spending benchmarks for CJR would require high-dual hospitals to reduce spending more substantially to receive a financial incentive.