“Our academic medical center client is mandated to participate in the CMS Transforming Episode Accountability Model (TEAM) and will be paid for all knee/hip replacements on a 30-day bundle basis,” stated Dr. Douglas G. Cave, President/CEO of Cave Consulting Group, Inc. (CCGroup). He continued, “Our client partnered with CCGroup to determine if the health system’s redesigned joint replacement program allows for profitability under CMS TEAM payment.”

Briefly, the health system implemented a new operating model where knee/hip replacement surgery occurs in the outpatient facility setting. After surgery, the orthopedic team makes the decision to send the patient home, to a rehabilitation facility, or to admit the patient for additional care. In all instances, the patient is assigned a post-operative care management team and access to a 24/7 afterhours orthopedic practice.

“Our client asked CCGroup to determine how their 30-day CMS TEAM bundle results compare to another teaching facility’s bundle results and whether the CMS TEAM bundle payment may be profitable,” stated Dr. Cave. “To perform this analysis, we utilized the CCGroup-CMS Innovator Project. This product offering is a Cloud/SaaS Subscription Model that has efficiency and quality results for most practicing PCPs and specialists in the United States.”

Results show our client has lower knee/hip replacement bundle costs than the competitor, which are attributed to: outpatient facility events being 71% higher; inpatient admissions being 35% lower due to procedures performed, when possible, in an outpatient setting (as well as a lower readmission rate); and somewhat higher home health care utilization (because patients are moved from a facility to home sooner). There was no discernable difference in TEAM quality measures as defined by the CMS Patient Safety and Adverse Events Composite (CMS PSI 90). The main bundle complication for both health systems is perioperative hemorrhage.

“We believe our client is well-positioned to accept a CMS TEAM bundle payment for lower extremity joint replacement (LEJR),” mentioned Dr. Cave. “However, we need to wait until CMS determines the exact LEJR 2026 bundle payment amount.”

About Cave Consulting Group, Inc. (CCGroup)

Cave Consulting Group, Inc. is a software and consulting firm located in San Mateo, California. The company is focused on improving the efficiency (cost-of-care) and effectiveness (quality-of-care) of the healthcare delivery system. Senior management of CCGroup has assessed the performance of physicians and hospitals for over 32 years for health plans, health systems, HMOs, physician groups, CINs, ACOs, TPAs, and employers.

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