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What Happens When Hospitals "Co-participate" in Multiple Value-Based Payment Models At the Same Tim?

As value-based payment models continue to scale up nationwide, the issue of "co-participation" -- i.e., situations in which provider organizations participate simultaneously in multiple payment models -- will becoming an increasingly important for policymakers and provider organizations to recognize and monitor. However, the impact of co-participation on patient outcomes has largely gone unevaluated.


Until now. In a new paper in JAMA Network Open, VSSL member Dr. Joshua Liao and colleagues evaluated hospital co-participation in Bundled Payments and Accountable Care Organizations (ACOs), two of the most prominent value-based payment models across the country, and the impact on outcomes among 483,008 Medicare fee-for-service beneficiaries.


The Key Question: for hospitals participating in bundled payments for joint replacement surgery, what is the association between simultaneous participation in accountable care organizations and joint replacement outcomes?


Main Findings:

  • co-participation was not associated with differential changes in episode spending, compare to participation in joint replacement bundles only

  • co-participation was associated with differentially greater decreases in hospital length of stay and home health care use, greater increases in postdischarge outpatient follow-up, and smaller reductions in unplanned readmissions

The implications of these findings are several-fold:

  1. The known favorable association of voluntary LEJR bundles with episode spending is underscored by the lower spending observed during 3 years among both bundled payment participants and co-participants compared with non-participants

  2. The differential changes in unplanned readmission rates across participation groups may suggest that bundled payment participants and co-participants adopt different clinical redesign strategies (with joint replacement bundle participants using well-known bundled payment strategies and co-participants using ACO infrastructure elements that focus on ambulatory care)

Take-Away: Hospitals co-participating in accountable care organizations and joint replacement bundled payments may adopt different care redesign strategies from hospitals in bundled payments alone without differences in episode spending.

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A technical point: The analysis by Dr. Liao and colleagues utilized an instrumental variable, an econometric method that can help address the concern that voluntary LEJR bundles are susceptible to "patient selection" (ie, changes in outcomes associated with changes in the types of patients who undergo LEJR surgery). For more information about the instrumental variable and implications of results generated using this method, see the full paper (linked above).

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