Lessons in Orthopaedic Leadership: An AOA Podcast
Lessons in Orthopaedic Leadership: An AOA Podcast
Future Trends and Challenges in Orthopaedic Coding and Payment Models with Dr. Adam Bruggeman
Discover the transformative changes on the horizon for orthopaedic coding and payment models with our esteemed guest, Dr. Adam Bruggeman. Covered are the new CMS-mandated procedural-based bundles, specifically the "team" bundle affecting 25% of US hospitals. Dr. Bruggeman sheds light on the financial and administrative hurdles these mandates bring and compares them to the cost-saving success of physician-led bundles.
Prepare yourself for an in-depth exploration of the evolving landscape of hospital-based healthcare bundles and their profound implications for orthopaedic surgeons. The conversation reveals how these new regulations might shift financial risks between hospitals and doctors, leading to a rare alignment of interests in opposing mandatory bundles. We also dive into the CMMI's push for value-based care and its potential impact on the sustainability of Medicare, putting a spotlight on the delicate balance of cost and care quality.
Join us as Dr. Bruggeman shares his expert views on the future of medical coding, particularly within the contexts of fee-for-service models and ambulatory surgery centers. From CPT and ICD-10 codes to the Resource-Based Relative Value Scale (RUC), we cover the complexities that define this space. We also discuss the slow shift towards value-based care and the promising, albeit underused, concept of condition-based bundles. This episode is packed with insights and foresight into the future of orthopaedic surgery and healthcare reimbursement models.
Welcome to the AOA Future in Orthopedic Surgery podcast series.
Speaker 2:Welcome to the AOA Future in Orthopedic Surgery podcast series. This AOA podcast series will focus on the future in orthopedic surgery and the impact on leaders in our profession. These podcasts will focus on the vast spectrum of change that will occur as the future reveals itself. We will consider changes as they occur in the domains of culture, employment, technology, scope of practice, compensation and other areas. My name is Doug Lundy. Host for the podcast series. Joining us today is Dr Adam Bruggeman.
Speaker 2:Dr Bruggeman is currently the chair of the Advocacy Council for the American Academy of Orthopedic Surgeons, where he spearheads the entire advocacy effort in government relations of the AAOS. He completed his bachelor's degree in health administration and policy at Creighton University and then a master's in hospital administration at Trinity University in San Antonio. After that he completed an administrative internship at Methodist Healthcare in San Antonio and then he went on to pursue his medical degree from the University of Texas Health Science Center in San Antonio again. He completed his residency in orthopedic surgery at the University of Florida and then returned back to Texas for his fellowship in spine surgery at the South Texas Spinal Clinic. Adam is currently the owner of the Texas Spine Care Center in San Antonio, texas. Dr Bruggeman. Welcome to the podcast, sir.
Speaker 3:Thanks, doug, it's a pleasure to be on here. I really appreciate you having me on today.
Speaker 2:And, as an SEC guy, I can't help but ask you are you a Gator fan or are you more Texas A Gator?
Speaker 3:Yep and more. Nebraska than anything honestly, but Gator, that's fine.
Speaker 2:Okay, yeah, I'm SEC Wesley. We're cool. All right, my friend, today we're going to talk about changes in coding and payer methodology and, as the chair of the Advocacy Council, you have a number of important academy committees you have, let's see, you have healthcare policy, you've got medical liability, but you've also got CCRC, which is what Coding coverage and reimbursement committee.
Speaker 2:That's right, all right. So nobody better than you, my friend, that knows about this stuff. So we're talking about the future in orthopedic surgery from your vantage point and I would argue you have probably the best vantage point of anybody in orthopedics to see where advocacy, where government CMS stuff has taken us. How do you see the changes in coding and pair methodology, both on the government and on the private side, occurring in the future?
Speaker 3:Yeah, well, I mean good timing for this talk, because just a few weeks ago we received notice that there was going to be a new mandatory bundle. Now we've had bundles in the past, but they've not been mandatory. They've been. If you would like to participate, you can participate. But suddenly they've come out with a new bundle that no one's ever seen before called team, and that bundle is going to be-.
Speaker 2:Sorry to interrupt. They is CMS, right CMS, that's correct.
Speaker 3:Yes.
Speaker 2:Centers for Medicare and Medicaid Service. Okay, sorry.
Speaker 3:And they're going to make that mandatory for 25% of US hospitals.
Speaker 3:So if you talk about where we're headed and what's happening, the advice that CMS is receiving from the various advisors, such as MedPAC, is that the reason why things have not been successful in value-based care is because they haven't made them mandatory, which allows those who know they will succeed to participate and those who know they will fail to stay out.
Speaker 3:And so this new wave, perhaps the trend that is coming is that we will start seeing these mandatory bundles and unfortunately, we have very limited input into how this works before it gets rolled out and we are then at some point responsible. The other interesting part about this mandatory bundle is we've seen different bundles where they either make the physician responsible for the bundle and financially as well, as you know, administratively responsible for the bundle, and then we've seen bundles where they've made the hospital responsible for the bundle administratively and financially. What the data suggests is that when the hospital is in charge of the bundle, the bundle tends to lose money. When the physician is in charge of the bundle, the bundle tends to lose money. When the physician is in charge of the bundle, the bundle tends to save money for the healthcare system. So this particular bundle, this team bundle, is again a hospital-based bundle. So some really intriguing things happening, coming down the pipe.
Speaker 2:Sounds like it. Glad you're advocating out there for us. So just to clarify a few things these are condition-based bundles, not, I'm sorry, procedural-based bundles, not condition-based bundles, right.
Speaker 3:That's exactly right. Touching on your point, we have put together a white paper as the academy that's been written by some very intelligent people Dr Bozic and Prakash over at Austin, as well as in collaboration with several others from around the country, to have a conversation about condition-based bundles, and the American College of Surgeons has also been out there waving the banner for condition-based bundles and has put a ton of work in identifying what is the condition, what goes into the condition, what isn't part of the condition, how would we model that economically? And yet again, the biggest problem we're having right now is that none of those ideas have been put forward. As you said, we're still looking at procedural-based bundles that look at a defined period of time around a specific procedure, as opposed to condition-based bundles, which are looking at something like knee pain and following that through from start to finish.
Speaker 2:And the scary thing for them about condition-based bundles is it gives control of knee pain, hip pain, back pain to us and everybody else is now cut out. We are the arbiters of who gets what treatment, and that's got to be kind of spooky to CMS.
Speaker 3:Yeah, it's interesting. The things that have made the most money under the various initiatives that have been proposed by CMMI have largely been ACOs. These bundles have not done very well. Acos, on the other hand, have been proposed by CMMI, have largely been ACOs. These bundles have not done very well. Acos, on the other hand, have returned a reasonable amount of money back to CMMI and in fact I believe it's next week the Energy and Commerce Committee is going to be having a hearing with Ms Fowler, who runs CMMI, to talk to her about why are things not working 10 years later with CMMI? What can we do to provide better return on our investment that we're putting into CMMI?
Speaker 3:So it is probably scary to them and they really want to move towards these ACO models. But I think, as we all know, as much as we love our primary care colleagues and I trust them for many things and I go see my own primary care doctor on a regular basis they're not the experts in musculoskeletal care. We are, as the group of orthopedic surgeons who manage these patients at the end, and sometimes all the way at the beginning of the problem and unfortunately that requires both CMS as well as those primary care groups and those ACOs to give up control, or some control, to the orthopedic surgeons to allow us to manage the part that we really know best, which is knee pain, hip pain, fracture work, so on and so forth.
Speaker 2:Right, but to your point though, this is all about procedural based bundles, right. So what procedures are, in this mandatory bundle, coming up?
Speaker 3:Yeah, so in your world, hip fractures are going to be in there Lower extremity joint replacement, so hip and knee replacement, and then spinal fusions will also be in the bundle. So a little bit of everything, a smattering of all things. Orthopedics there are some other non-orthopedic items that will be in there. I believe it's a major abdominal surgery will be in there and I think there's a cardiac component that's in there as well. But as it relates to orthopedics, it's the four of hip fractures total joint replacements and spine surgery.
Speaker 2:Now, for many places, total knee and total hip arthroplasty fit nicely in the bundles until you get to the floor of where there's no more squeeze left and everybody starts taking a hit on the procedures. But hip fractures, man, that's a tough thing to bundle right.
Speaker 3:Yeah, I think I mean you know as well as anyone does the complexity that's involved in taking care of a hip fracture and all the various things the patient comes in with. That's not an elective procedure, unlike the other ones that we have listed on the orthopedic requirements or the procedures that will be in there Knee replacements and hip replacements. If the patient's not ready for knee replacement or hip replacements, they're diabetic, they have some sort of heart issue that we want to hold off on. We're going to hold off, but unfortunately, with a hip fracture, there comes a point in time where you just have to do the procedure and deal with the complications that are a result of that, and so this is going to be a very complicated bundle, and making it mandatory will increase the complications revolving around it. And I would tell you, the bundle includes the next 30 days after care is rendered, so it's not just the timing of the hospitalization, it's also the next 30 days after the procedure is completed.
Speaker 2:Gotcha. Yeah, I wonder how many readmissions are going to occur 32 days after the procedure. You know so the two previous bundles were BPCI and CJR. Can you briefly kind of tell everybody where those bundles are and how they may differ from this new bundle? What's the name of the new bundle, by the way? So it's called team. Oh, you said that.
Speaker 3:I'm sorry, yeah, it's unclear that they are ready to sunset the other bundles, and so this may be the replacement for our current bundled systems. It's unclear they are ready to sunset the other bundles, and so this may be the replacement for our current bundled systems, and so the timing of this lines up. It would start January 1st 2026. The assumption is they would be notifying the hospital systems in 2025, who is going to be required to participate. Then, in January 1st 2026, they would then begin participating, and so I think that will likely mean the ending of our current bundled systems and a transition to these new bundles, at least as it relates to CMS. As we know, many of our orthopedic colleagues across the country have successfully identified excellent bundles to be in with private payers and have been very happy with those, in contrast to the bundles that we've had so far with CMS Right now some of the previous bundles, cjr and PPCI specifically.
Speaker 2:In my impression or my recollection, very few people got the downside of that bundle right. They were CMS came back and said all right, we're clawing back money or we're not going to pay you as much on the next one because you owe us. Most of the people that were participating in the bundle made money on it right.
Speaker 3:They did, but remember that the problem was that the target started moving, and so when the goalposts move every year because you start getting better at what you do and now you're no longer compared to the average in your community, you're compared to how well you did it this year or this past year and the savings that you generated you can no longer continue to generate and it's like you hit this mark this year. See if you can exceed that mark or you're going to end up getting penalized. And so a lot of groups were very involved in the bundles and then pulled out of the bundles over time as the goalposts started to move, because it suddenly wasn't making any sense. And unfortunately, despite some feedback that we've had so far with CMMI, it appears that they intend to move the goalposts under the team model as well, and they have admitted as such that that would make it very difficult, but they feel that they need to be able to move the goalposts every year or every two years.
Speaker 2:Right. What I was trying to get at was, as opposed to the past, where most people did well into the bundle and if you didn't, you just pulled out the next year and you quit. It sounds like going forward. There's going to be a lot of orthopedic surgeons who are getting some nasty letters from CMS saying you failed to meet the target price and, as a result, we're either clawing back money or recapturing the. I'll let you run with that.
Speaker 3:Yeah. So it's interesting how this is going to work, because this will be a hospital-based bundle again, so the financial responsibility will fall on the healthcare system. But the healthcare system has the ability under the new law or under the proposed regulatory, to share upside and downside with anyone else they want to share it with. So theoretically, whether employed or just providing services in that hospital system, the hospital could come to our employed doctors or to just our community physicians and say we'd like to share some of the upside and downside with you, because we recognize that you are going to be making many of the decisions that help us either revenue positive or lose money. But it's theoretically possible that after that downside penalties could come with the sharing risk with the hospital system. And so I think it's going to be very interesting to see how those contracts are drawn up, see whether or not the hospitals agree to let doctors participate in upside and downside risk and whether or not the doctors truly want to participate in the upside and downside risk for their various bundles that they're involved in.
Speaker 2:Yeah, it's a great point. And to your point earlier I could see a group like my old group saying we got this figured out on total joint arthroplasty. Yeah, we'll go upside and downside on that if the hospital let us, and if you don't let us you're going to have a horrible time adjudicating this. But I can tell you from my old hospital we would run fast and run hard from hip fractures because, man, that's so hard to get right.
Speaker 3:It is. It's incredibly difficult to get correct and I just again, we're still we're at the early point of this. We're still learning what's going, how they're going to actually administer this and what's going to be counted and what's not going to be counted. They do have a relatively lengthy document out there, but I think it's going to be complicated for fractures. I do think some of our general surgical colleagues with major abdominal surgery, similar problem, these people are going to come in with a problem that you can't say no to and you have to take care of in that hospitalization and that may end up as something that they aren't really excited about being a part of, or the hospitals themselves are not excited about being a part of it. So, interestingly, we find ourselves advocating together with the hospitals, whereas in many, many different advocacy efforts we found ourselves on the opposite side of a conversation. In this one, we are finding that the American Hospital Association and the FAAH are both saying you know, we really don't want this bundle either. This mandatory component of it is not a good idea.
Speaker 2:Now a couple times back you said CMMI. Just for folks that aren't extensively in the advocacy space, can you explain what CMMI is and who they work for?
Speaker 3:Yeah, so CMMI Centers for Medicare and Medicaid Innovation is, I believe, value-based care but ways to reduce the cost of the entire health care system. How do we preserve Medicare? By Congress, I believe it's $10 billion has been allocated by Congress to go to CMMI to identify innovative ideas and implement them, and they've got a lot of them. There's not just orthopedic ones, there's other ones in, say, kidney disease and other areas. But the goal of that organization again is to push these new payment systems or innovative structures that would allow for a reduction in the cost of care for Medicare, to try and preserve Medicare long-term.
Speaker 2:Great, so you've got a lot of experience in this. It sounds like, based on the recent past and then this upcoming decision by CMS, that the federal government feels that bundling healthcare is in their best interest in the way that they will proceed with coding and payer methodology. Would you agree with that?
Speaker 3:Yeah, I think the answer is they don't feel that fee-for-service is the future. That seems to be a inevitable existential problem for Medicare Right now. The alternative to that is value-based care, whatever that means, and I think that's obviously been a term that's been used by many different people to mean many different things. But right now they are looking to value-based care to replace fee-for-service, as opposed to continuing to fund and push towards what they feel is an inevitable cliff if we continue down fee-for-service as the only way we pay for things, and so they've put goals in place to eventually convert all of payments over to some form of value-based care payment system.
Speaker 2:So with terms of codes, so we use the codes for fee-for-service right? We submit our CPT codes and ICD-10 codes to CMS or to the insurance company. We pay for what we do. How do you see coding moving in the future, specifically overall, and how coding goes? And then, if you want to explain how the RUC works, what the RUC is and how that might change, however you feel and this is I'm asking you to guess out in the future. So this is, we're not going to hold you to it, we just want to know what you're thinking.
Speaker 3:Well, I would tell you on the subject of coding, one thing that has really raised a flag on our radar is the coding in the ASC space. So last year at the end of the year, suddenly total shoulder replacement showed up on the ASC coding list, and ASC payments are different than how we get paid and they're different how hospitals get paid. There are essentially six buckets, or APCs, that determine how much is paid, pays the same amount unless it's a device-intensive procedure that could get an additional payment because that bucket just couldn't possibly pay for the device that would be necessary to perform the procedure. Total joint replacement is in the highest bucket and pays at the highest levels and others pay less. Unfortunately, just like the physician fee schedule, it is subject to budget neutrality and so as new procedures get admitted onto the APC schedules, whichever bucket they drop into ultimately causes everything in that bucket to reduce, based on the amount of projected volume for that procedure and the amount of projected expenditure for that procedure. So when total shoulders got put in, they were ultimately adjusted up to APC6, which is the highest level, which put them in the total knee and total hip. Before that occurred, there was an anticipation of a slight increase in pay for that APC6 bucket.
Speaker 3:After it occurred, there was actually a decline in pay for total hip and total knee starting this year at the ASC level, and so one of the things that we're keeping an eye on is a lot of the more expensive procedures, such as spine procedures, have not made their way to the APC, and so we are actually at the end of this year beginning with the coding coverage and reimbursement committee to bring in experts on ASC coding to say you know, a lot of our surgeons have interest in one way, shape or form in a surgery center and a lot of our cases are shifting to surgery centers.
Speaker 3:If that is the case, what do we need to be doing to help ensure that cases are still viable? We don't want to get to a point where surgery center cases are paid so poorly that there's not sufficient margin that the cases then flip back to going from ASCs back to hospitals. That's not in the best interest of us. We've been talking about reducing the cost of care and it would really hurt and harm many of our private practicing groups, and so this is going to become a really, really big issue for orthopedics in particular, who is going to be a group that is going to see a lot of their codes ending up in the same buckets. And how do we continue to communicate the value of that? And how do we prevent all of the issues we've been having since 1989, when we came out with a singular conversion unit for RVUs, and the continued reimbursement decline we've seen in the fee-for-service world? How do we protect that on the APC side to the extent that fee-for-service is still around? That's going to be a really important detail for us going forward.
Speaker 2:All right. So look ahead 10 years or so. With the constant push on value-based care, where are we going to be? Are we going to? Is fee-for-service still going to exist at all? Are we still going to be using the current coding and payer technologies that we have, or what do you see?
Speaker 3:Yeah, I think we've still been so. We've had such a difficult time implementing the processes that we have in place right now, and we've identified very few things that can actually save money. Value-based care has a lot of potential but not a lot of actual revenue generation currently within the system, and so I think it's going to still be very slow. We're 10 years into this process with CMMI and we've really not been able to identify a key target that we can roll out to all different specialties. There's some hope around condition-based bundles that we can do it, but we need the latitude to get that done and you know currently it doesn't appear that CMMI has an interest in those types of bundles. Other specialty organizations on the Hill talking about protecting fee-for-service and ensuring that it gets inflationary updates, because we don't see a quick and easy transition to value-based care over the next decade.
Speaker 2:That's the best way I've ever heard that explained to date. I mean the way you said it in terms of we've been doing it for 10 years, we haven't gotten anywhere. So because when you read the CMS websites and such, they pound out that, oh, we're going to do this in no time at all. And, to your point, if you could even elaborate on this, as we've said on this podcast and others is, and see if you agree, as CMS goes, so goes the private payers.
Speaker 3:Yeah, absolutely, and I would argue even that there are many payers now who are using CMS as the top, not the bottom, meaning they're negotiating percentage contracts below Medicare reimbursement going forward and I think they're just seeing how far they can actually go before it stops right, before they can't contract anymore and they don't have enough doctors in a given community. That's crazy.
Speaker 2:Oh my gosh. Okay, so earlier we had talked about the condition based bundle and I think you talked about it a fair amount, but just to make sure, could you further explain that, just so everybody understands where that is, because it is such an important thing? That is probably the way we're going in the future.
Speaker 3:Yeah, I mean really it's a. It's a very intelligent design of how to take care of patients and the way that we think about taking care of patients. All of our training was designed to take care of conditions, not to take care of episodic problems, and this concept is that, instead of just being the technicians who operate on patients, we become the kind of stewards of musculoskeletal care from start to finish. So a group whether they're employed or they're in private practice or they're part of a university group would be provided with a population of patients and they would be paid a set amount for every patient who, let's say, develops knee pain. And some of those patients who develop knee pain have an ACL tear and under the current system you'd have to go through prior authorization and do all these different things to make a decision about what to do with that patient. But you might know, hey, if I can take that patient to the operating room now, before their swelling starts, I think I can save six weeks of rehab and I think I can save that, get that patient back to work faster. Well, that's your money. You're going to be paid a lump sum of money to take care of that knee pain. Another patient might have just been playing on the weekend basketball and tweaked their knee and you see them one time you might even just have a PA or a nurse practitioner see them to evaluate them initially and say, oh, that's just something that's gonna get better with one or two visits of physical therapy and some ibuprofen. And you send them on your way and you get paid that same lump sum of money. And so as you make the right decision for patients at a clinical level throughout their process number one we think it can probably get rid of a lot of the headaches administratively, like prior authorization that we have and the hiccups and the things that frustrate us about taking care of patients. But number two it's going to reward us for everything we learned in medicine.
Speaker 3:I remember, you know, there's kind of that dictum of you know, you don't just learn how to operate in orthopedics, you learn who to operate on. And that's probably the thing you learn, unfortunately, later in your career as you make the mistakes and you go gosh, I wish I wouldn't have operated on that person. But what if we paid you for learning who to operate on? You know, if you think about it, today we get paid a small amount for clinic visits. We get paid a larger amount for surgeries. But what if I just told you I'm just going to pay you for doing the right thing for that condition? Now we get to use our entire set of everything we learned in orthopedics.
Speaker 3:You know, that fracture, that supracondylar humerus fracture in that four-year-old probably doesn't need to get pinned. So I'm just not going to pin it, I'm going to put it in a splint and cast and send it out, or that that one actually really does need to get pinned and I'm going to make that decision. That's right for that patient. So that's what condition-based bundles is. We pay for a set of a population for specific conditions like knee pain or back pain or hip pain, as opposed to paying for each office visit and each physical therapy visit and the surgery center and the doctor to do the surgery. It thinks more holistically and rewards people for making the right decisions at various points along the pathway.
Speaker 2:Very good, that's a good, good description of that. I'm sure you've heard the quote takes five years to learn when to operate. In a lifetime to learn when not to right. That's right, that's right. Last question for you, so typical of the US political process we tend to flip back and forth between the parties every eight, four to eight years or so. We typically tend to do that here in the United States over recent history, agnostic to who's running the Congress and who's running the presidency. Or do you think, other than mild, of course there's going to be mild flavors to it, but or do you see this? Do you think there's going to be a greater impact if there's a significant change in administration?
Speaker 3:Yeah, that's a great question. So I would tell you that currently and again, cmmi holds a lot of the purse strings for what we do with respect to future coding. Currently, cmmi is almost all career people in DC. Therefore, uninfluenced by the administrations that come and go, while the heads of each of those organizations, like the secretary of HHS, is a political appointee, the people who work within CMMI are not.
Speaker 3:There is a growing desire within DC to potentially break that up and say maybe the reason this hasn't been working is because we've lived in an echo chamber where these people who eat, sleep and breathe DC have no new ideas and they keep telling each other the same ideas and that's why maybe they're not listening to condition-based bundles. So maybe we need to infuse a few more political appointees into CMMI and not have so many career people in CMMI. And I see that as probably being a part of these hearings coming up. I see that as being a goal of several of the people in DC to say what can we do to shake this up, to get something out of CMMI? Not blow it up, not kill it, but let's shake it up a little bit. And if that happens, we're certainly going to see that, as administrations ebb and flow, that's going to impact the perspective towards different value-based care solutions.
Speaker 2:All right, that is fantastic. You've given us a very, very good overview of the future in this and I really appreciate it. So I'd like to thank my guest, dr Adam Bruggemann. As I said, he's currently the chair of the Advocacy Council for the American Academy of Orthopedic Surgeons and, as you could tell, he has a very unique and very comprehensive view of what's happening in terms of this area specifically, and I'm so glad you're representing us at the academy level, and thanks for all your service there, sir.
Speaker 3:Thank you. I very much appreciate your time today and happy to educate everybody on the issues we're facing.
Speaker 2:Thanks again, and all the stuff that you're putting out through the AOS no-transcript.