Implementation of a Private Payer Bundled Payment Model While Maintaining High-Value Lumbar Spinal Fusion

Study Design: Retrospective single-institution cohortObjective: To evaluate the implementation of a commercial bundled payment model in patients undergoing lumbar spinal fusion.Summary of Background Data: BPCI-A caused significant losses for many physician practices, prompting private payers to establish their own bundled payment models. The feasibility of these private bundles has yet to be evaluated in spine fusion.Methods: Patients undergoing lumbar fusion from October to December 2018 in BPCI-A before our institution's departure were included for BPCI-A analysis. Private bundle data was collected from 2018 to 2020. Analysis of the transition was conducted among Medicare-aged beneficiaries. Private bundles were grouped by calendar year (Y1, Y2, Y3). Stepwise multivariate linear regression was performed to measure independent predictors of net deficit.Results: The net surplus was the lowest in Y1 ($2,395, P=0.03) but did not differ between our final year in BPCI-A and subsequent years in private bundles (all, P>0.05). AIR and SNF patient discharges decreased significantly in all private bundle years compared with BPCI. Readmissions fell from 10.7% (N=37) in BPCI-A to 4.4% (N=6) in Y2 and 4.5% (N=3) Y3 of private bundles (P<0.001). Being in Y2 or Y3 was independently associated with a net surplus in comparison to the Y1 (beta: $11,728, P=0.001; beta: $11,643, P=0.002). Postoperatively, length of stay in days (beta: $-2,982, P<0.001), any readmission (beta: -$18,825, P=0.001), and discharge to AIR (beta: $-61,256, P<0.001) or SNF (beta: $-10,497, P=0.058) were all associated with a net deficit.Conclusions: Nongovernmental bundled payment models can be successfully implemented in lumbar spinal fusion patients. Constant price adjustment is necessary so bundled payments remain financially beneficial to both parties and systems overcome early losses. Private insurers who have more competition than the government may be more willing to provide mutually beneficial situations where cost is reduced for payers and health systems.Level of Evidence. 3