A study published online in the journal JAMA Internal Medicine finds that implementation of bundled payment models was associated with overall hospital savings and reduced Medicare payments. 

The authors conducted an observational study of 3,942 patients who underwent lower extremity joint arthroplasty at a single health system that participated in the voluntary Acute Care Episodes (ACE) and Bundled Payments for Care Improvement (BPCI) Medicare demonstration projects. Across 3,738 episodes of joint arthroplasty without complications, they found that average Medicare episode expenditures declined from $26,785 to $21,208 (20.8 percent) between July 2008 through June 2015. Among 204 episodes with complications, expenditures declined from $38,537 to $33,216 (13.8 percent). The authors write that, by 2015, 51.2 percent of overall hospital savings had come from internal cost reductions and 48.8 percent from postacute care (PAC) spending reductions. They found that average PAC spending declined 27 percent per case, "largely from reductions in inpatient rehabilitation and skilled nursing facility spending but only when bundles included financial responsibility for PAC." The authors note that reductions in implant costs contributed the greatest proportion of hospital savings. Learn more...