Baylor Hospitals in Texas reduce costs while Providence, Texoma & Medical City see no change in BPCI-A Hip & Knee Replacement Programs



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By: Barsha Nandy  Oct. 01, 2020

Dexur analyzed Medicare Claims data to evaluate Bundled Payments for Care Improvement Advanced (BPCI-A) episode costs for Inpatient Hip and Knee Replacement Surgery in Texas and found that Baylor Hospitals in Frisco, Sherman, Fort Worth & Trophy Club performed the best and reduced total costs by 10-20%. The biggest cause of these changes was a reduction in post anchor stay costs of Rehospitalizations, Skilled Nursing Homes & Home Health. Providence (Waco), Medical City (Plano, Arlington), Texoma (Denniston) Hospital saw little change or increased costs under the same program.

The analysis was done at the DRG level to implement risk adjustment, specifically for DRG 470: Major Joint Replacement or Reattachment of Lower Extremity without Major Complication or Comorbidity (MCC). The episode window for BPCI-A is split into two periods; anchor stay and duration of 90-days following discharge. During this window, claims attributed to the patient are aggregated to derive a bundled payment for conditions listed under the BPCI-A Model Year 3. The study included hospitals with a minimum of 50 hospitalizations in the program across one year and compared the average episode cost for the Jan-Dec 2019 period versus the same in 2018. Dexur devised CMS’ Model Year 3 (enforced from January 1, 2020) methodology across all the periods involved to construct consistent and comparable calculations.

CMS classifies two types of participants under the program: convenor and non-convenor. A Convener Participant is an organization that brings together multiple downstream entities, known as Episode Initiators (EI), which are either Acute Care Hospitals (ACH) or physician group practices(PGP). The Convener Participant facilitates coordination among EIs and bears and apportions financial risk. A Non-Convener Participant is either an ACH or PGP that bears financial risk only for itself and does not bear financial risk on behalf of downstream EIs.

BPCI-A Hip and Knee Replacement Surgery Episode Cost Breakdown for Hospitals in Texas
Hospital Name Hospital City BPCI Convener # of Episodes (2019)

Avg. Cost per Episode - Clinical Episode

(2019)

Avg. Cost per Episode - Clinical Episode

(2018)

Clinical Episode% Change in Cost per Episode DRG 470 - # of Episodes (2019) DRG 470 - Avg. Cost per Episode (2019) DRG 470 - Avg. Cost per Episode (2018) DRG 470 % Change in Cost per Episode Post anchor stay - # of discharges DRG 470 - Post-Anchor Stay Cost - (2019) DRG 470 - Post-Anchor Stay Cost - (2018) DRG 470 % Change in Post Anchor Stay Cost
Baylor Medical Center at Frisco FRISCO USPI 300 $17,156 $18,979 -9.61% 287 $17,047 $18,843 -9.53% 282 $6,419 $8,040 -20.16%
Baylor Scott and White Surgical Hospital Fort Worth FORT WORTH USPI 159 $18,720 $22,258 -15.90% 126 $18,562 $20,465 -9.30% 117 $7,446 $9,234 -19.36%
Baylor Scott and White Surgical Hospital at Sherman SHERMAN USPI 127 $18,734 $20,491 -8.57% 159 $18,720 $22,155 -15.50% 158 $7,495 $10,988 -31.79%
Baylor Medical Center at Trophy Club TROPHY CLUB USPI 116 $18,859 $23,400 -19.41% 115 $18,897 $22,504 -16.03% 115 $7,683 $11,059 -30.53%
Providence Health Center WACO Providence 171 $22,743 $20,847 9.09% 160 $21,691 $20,404 6.31% 154 $9,315 $9,198 1.27%
Midland Memorial Hospital MIDLAND Remedy 74 $26,059 $30,304 -14.01% 68 $24,311 $27,391 -11.24% 64 $13,317 $15,770 -15.55%
Medical City Plano PLANO Signature Care 73 $28,743 $30,876 -6.91% 190 $26,624 $26,329 1.12% 185 $13,875 $14,231 -2.50%
Medical City Arlington ARLINGTON Signature Care 216 $29,630 $27,526 7.64% 69 $28,011 $27,264 2.74% 68 $14,500 $14,729 -1.55%
Texoma Medical Center DENISON Remedy 108 $32,237 $29,456 9.44% 91 $28,900 $27,015 6.98% 88 $16,728 $15,468 8.15%
University of Texas Medical Branch GALVESTON Remedy 68 $39,311 $40,414 -2.73% 62 $37,956 $39,715 -4.43% 61 $15,499 $18,290 -15.26%

Baylor Scott and White acute care facilities lead the list with significant improvements in their episode costs. Medical Center at Trophy Club’s average contracted by 16.03% in 2019 compared to 2018; highest among the cohort. Sherman’s percentage decline of 15.5% was the second among top hospitals, followed by Midland Memorial Hospital’s average shrinking by 11.2% during the same period and Frisco’s by 9.53%. The fourth Baylor subsidiary in the list, Surgical Hospital at Fort Worth ranked fifth with a decline of 9.3% at the end of the JFM quarter in 2020.

The study also shows that a sizable proportion of the episode cost stems from post-anchor-stay, which includes rehospitalization, outpatient, skilled nursing facility, home health, and hospice claims. Sherman’s average post-anchor-stay cost reduced significantly by 31.79% from $10,988 in 2018 to $7,495 in 2019. Trophy Club’s average tumbled by 30.53% to limit their post-anchor-stay expenses at $7,683 in 2019 compared to $11,059 in 2018. Baylor Medical Center at Frisco’s post-hospitalization cost for an episode decreased from $8,040 to $6,419 during the same comparison period, by 20.16%. Surgical Hospital Fort Worth and Midland Memorial Hospital had a decline in post-anchor-stay average by 19.36% and 15.55%, respectively.

Both facilities of Medical City at Arlington and Plano recorded a hike of 2.74% and 1.12% respectively in their episode cost through the analysis period. Post-anchor-stay cost dipped slightly by 1.55% for Arlington and 2.5% for Plano. Providence Health Center’s both episode and post-anchor-stay cost increased by 6.31% and 1.27%, respectively. The highest surge of 6.98% in episode cost was for Texoma Medical Center, which also recorded the highest increase in post-acute-stay average at 15.26%.