Reimbursement Rates for Joint Arthroplasty in the U.S. Vary Widely

Medicare reimbursement for arthroplasty procedures has changed drastically since the year 2000, with significant geographic variability in payment models. The findings were presented by Jack Haglin, MD, from Mayo Clinic in Phoenix, Arizona, and colleagues. The authors explained that the Centers for Medicare & Medicaid Services calculates Medicare reimbursement using the geographic practice cost index (GPCI), which varies by region and acts as a location-corrective multiplier for physician reimbursement. With this study, Dr. Haglin and researchers sought to understand the impact of the GPCI on reimbursement to orthopaedic surgeons for arthroplasty.

The researchers used the Physician Fee Schedule Look-Up Tool to estimate reimbursement amounts for inpatient TJA (total hip arthroplasty and total knee arthroplasty) in 2000, then compared them to data from 2020, after adjusting for inflation.

From 2000 to 2020, average reimbursement for TJA dropped from $2,368.43 to $1,399.61, or a 40.9% decline. The largest average decreases in reimbursement were in Hawaii (–45.1%), followed by California (–44.7%) and Michigan (–44.6%).

Alaska had the highest reimbursement amount in 2020, at $1,799.08, followed by New York ($1,620.71) and Florida ($1,549.56). On the other end of the spectrum, the lowest-reimbursed states were Nebraska ($1,260.02), Mississippi ($1,268.64), and Arkansas ($1,270.20).

The authors noted that the wide geographic variability in reimbursement in the past two decades may indicate administrative factors that affect physician payment, such as an outdated GCPI in certain localities.