Association of Mandatory Bundled Payments for Joint Replacement With Use of Postacute Care Among Medicare Advantage Enrollees

In 2016, the Centers for Medicare & Medicaid Services introduced mandatory bundled payments for knee and hip replacement surgical procedures among traditional Medicare (TM) patients in randomly selected areas. The association of bundled payments with outcomes among patients enrolled in Medicare Advantage (MA) is not known. To determine the association of bundled payments for joint replacement surgical procedures with the use of postacute care (PAC) services among MA patients. This cohort study used difference-in-differences analysis to evaluate changes in PAC use among patients enrolled in Medicare who underwent joint replacement operations before and after the introduction of bundled payments (ie, from January 1, 2013, to September 30, 2017). A total of 75 metropolitan statistical areas were randomized to participate in the bundled payment program, with 121 areas serving as controls. Data were analyzed between September 15, 2018, and October 1, 2019. Bundled payments for hip and knee joint replacement operations, in which hospitals received a single payment to cover all costs associated with a joint replacement and associated care for the 90 days after surgery. The primary outcomes were discharge to any institutional PAC setting and days spent in institutional PAC within 90 days after surgery. Secondary outcomes included discharge and days spent in specific PAC settings (ie, home health, skilled nursing facility, inpatient rehabilitation). Of 1 536 387 individuals who underwent hip and knee join replacement surgery, 493 977 (32.2%) were enrolled in MA (mean [SD] age, 73.3 [8.4] years; 386 699 [63.5%] women; 55 078 [6.4%] black) and 1 042 410 (67.8%) were enrolled in TM (mean [SD] age, 73.3 [8.7] years, 829 014 [65.2%] women; 82 890 [9.4%] black). Among MA patients, bundled payments were associated with a reduction of 1.5 (95% CI, 1.0-2.0) percentage points in discharge to an institutional PAC setting (P