ARTICLE SUMMARY:
The move of many common musculoskeletal procedures to outpatient settings are likely to lead to new alliances among hospitals, ASCs, and surgeons, with implications for implant vendors.
2021 is shaping up to be a big year for migrating many musculoskeletal (MSK) procedures from hospitals to the outpatient (HOPD) and ambulatory surgery center (ASC) settings.
Two forces have aligned to put MSK migration in super-speed. COVID-19 greatly reduced access to hospital care, especially for elective procedures. While ACS case volumes also plummeted, their businesses have picked up faster, as patients still wary of hospitals are migrating to freestanding facilities. Furthermore, surgeons who could not operate in hospitals during the peak of the pandemic found they were able to do so with equal success in the outpatient setting and, most notably in ASCs, facilities of which they were previously wary.
Current caseloads at ASCs are either at or above pre-COVID-19 levels for most of its members, according to the Ambulatory Surgery Center Association (ASCA). Those who are lagging expect to return to pre-COVID levels by the third or fourth quarter of this year, the association reports.
At the same time, CMS changed its reimbursement policies in ways that dramatically favor the use of ASCs over hospital-based care for certain procedures, with a strong 
focus this year on MSK services (see Figure 1). The agency, eager to increase patient choice and lower costs, is allowing more procedures to be done in multiple sites of service, including some, for the first time, in ASCs. ASCs are paid a much lower facility fees than hospitals for the same service, and patients have less out of pocket expenses—CMS cites cataract surgery as an example, where on average patients pay $51 out of pocket for the procedure, while they would pay $101 if their procedure was done in a HOPD.
The CMS changes include:
- Elimination of the inpatient only (IPO) list over three years, ending January 2024, which will give clinicians the option to perform 1,740 types of procedures in the hospital outpatient setting. While this includes multiple service lines, as part of this transition, the agency is removing approximately 266 musculoskeletal related services, including total joint replacement (TJR), from the IPO list immediately. These procedures would be newly payable in the HOPD setting—which includes hospital-affiliated outpatient facilities. It is the largest one-time reduction of the IPO to date; from 2017 through 2020, about 30 services were removed from the IPO list, according to CMS.
- At the same time, the agency is adding 11 MSK procedures, including total hip arthroplasty (THA), to the list of procedures that can be done in the ASC setting. This would bring to 39 the number of procedures Medicare has added to the ASC covered procedures list. CMS approved total knee arthroplasty (TKA) for ASCs in 2020. Medicare’s stance on total joint arthroplasties (TJA) is important because it pays for most of these procedures–about 70% of TKA cases, by some estimates.
- In addition, Medicare is potentially adding approximately 270 procedures that are already payable in the hospital outpatient setting to the ASC CPL, significantly expanding the types of procedures that could be done in the ASC setting and it is revising the criteria for adding more procedures to the ASC CPL lists in the future.
While the processes have been underway slowly for some time, the most recent CMS policies are forcing stakeholders to respond aggressively.
Excerpted from “As MSK Procedure Migration to ASCs Accelerates, Hospitals, Surgeons, and Orthopedics Makers Are on the Spot,” MedTech Strategist, June 24, 2021.
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