Table 4. Estimated Savings From CJR Accounting for Different Forms of Patient Selection, Stratified by Type of MSA.
| Model | Approach to account for patient selection on spending estimates, adjustments included in model | Difference-in-differences estimates of program effect on institutional spending under each approach (95% CI), $ | ||||||
|---|---|---|---|---|---|---|---|---|
| Mandatory MSAs | Voluntary MSAs | |||||||
| Patient characteristics? | Which knee price was used? | Year 1-2 | Year 3-4 | Change from year 1-2 to year 3-4 | Year 1-2 | Year 3-4 | Change from year 1-2 to year 3-4 | |
| Model description | ||||||||
| (1) Not accounting for patient selectiona | No | Average inpatient | −1223 (−1809 to −638) | −1043 (−1748 to −338) | +180 (−134 to 495) | −516 (−981 to −51) | −276 (−780 to 229) | +240 (−92 to 573) |
| (2) Accounting for differential selection of patients for outpatient LEJR | No | Observed outpatient | −1226 (−1813 to −640) | −750 (−1414 to −86) | +476 (207 to 746) | −517 (−982 to −53) | −332 (−847 to 182) | +185 (−167 to 537) |
| (3) Additionally accounting for differential risk selection based on observed patient characteristics | Yes | Observed outpatient | −1194 (−1631 to −758) | −588 (−1115 to −62) | +606 (348 to 864) | −610 (−983 to −238) | −283 (−718 to 152) | +327 (40 to 615) |
| Net effect of accounting for patient selection in estimate of program effect (model 3 minus model 1 estimates)b | NA | NA | +28 (−192 to 224) | +455 (137 to 722) | NA | −98 (−215 to 35) | −9 (−226 to 222) | NA |
Abbreviations: CJR, care for joint replacement; CMS, Centers for Medicare & Medicaid Services; LEJR, lower-extremity joint replacement; MSA, metropolitan statistical area; NA, not applicable.
The counterfactual used for this analysis analogous to the benchmarks used by CMS to calculate savings in the CJR program year 4. The benchmarks in year 4 were based on historical episode spending in a hospital’s region from 2014-2016 and thus only reflected spending for inpatient LEJRs. These benchmarks were adjusted minimally for patient factors (only for whether patient had a fracture and whether the procedure was associated with major complications).
CIs on the net effects before and after year 3 were obtained by bootstrapping from 1000 random draws of MSAs (mandatory or voluntary respectively), equal to their number in treatment and control. All estimates were adjusted by MSA fixed effects and errors were clustered at the MSA level. eMethods 2 in the Supplement on the model specification shows the full list of patient characteristics used in model 3.