Participation in Medicare’s first bundled payment model for outpatient spine surgery can be linked to fewer readmissions and lower costs, according to a recently published study in JAMA Health Forum.
Researchers from the University of Pennsylvania examined outcomes for 14,280 Medicare beneficiaries who had outpatient back and neck surgery without spinal fusion between 2013 and 2019. They compared hospitals participating in the Bundled Payments for Care Improvement Advanced (BPCI Advanced) program with matched hospitals that did not participate, focusing on the program’s first year for this outpatient episode type.
Hospitals in the program saw an average reduction of $1,201 in total 90-day episode spending compared with nonparticipants, researchers found.
And spending decreases were driven mainly by reductions in inpatient and professional service costs. Patients at participating hospitals were also 2.2 percentage points less likely to have a return inpatient admission within 90 days of surgery.
“For outpatient spine surgery, hospital participation in bundled payments was associated with reduced spending and improved quality,” researchers wrote.
By contrast, for 23,440 patients who had the same procedures in the inpatient setting, the study found no significant changes in spending or quality outcomes tied to BPCI Advanced participation.
“The outpatient savings are notable because previous bundled payment results for orthopedic surgery have been concentrated in reductions of postacute care, which is less common after outpatient procedure,” researchers wrote.
Savings appeared to be linked to fewer inpatient admissions and associated costs, they added.
The findings come as the U.S. Centers for Medicare & Medicaid Services (CMS) is preparing to launch the Transforming Episode Accountability Model (TEAM) in 2026, which will include mandatory bundled payments for selected outpatient surgeries in certain markets.
Although the study only covers the program’s first year and excluded procedures done in ambulatory surgery centers (ASCs), the results suggest bundled payments could help control costs and maintain or improve quality for outpatient surgical care, researchers wrote.
“Participation in the first year of a bundled payment program for outpatient spine surgery was associated with significantly lower spending and fewer readmissions during an episode of care,” they wrote.
Still, longer-term data is needed to be sure, and patient selection and voluntary participation could influence results, researchers wrote. But the early evidence supports expanding bundled payment models to include outpatient episodes.
“Our findings suggest that including outpatient surgery in bundled payment programs might have advantages, with the potential to generate savings independent of reductions in postacute care,” they wrote.
