Frank Raneri, Senior Vice President, Paradigm Specialty Networks
In a previous post, we reviewed how the COVID-19 pandemic caused the temporary closure of ambulatory surgery centers (ASCs) in April. Since reopening in May, they have been able to resume operations at or near previous capacity. This is particularly important for orthopedic surgeries related to workers’ compensation cases, as they are still essential to a full recovery for many injuries, despite being officially deemed “non-emergent.”
ASCs, which were already being touted for their ability to deliver positive outcomes and lower infection rates while reducing hospital-associated costs, are now in a unique position to provide services for injured workers as COVID-19 infections continue to rise as of July 2020. To better understand how they provide these advantages, it will be beneficial to explore the dual phenomena of rising costs and the increased risk of infection for hospital-based orthopedic surgeries.
Robust evidence for rising hospital-based surgery costs
Managing non-emergent, orthopedic surgical episodes in an ambulatory surgical setting offers both the lowest risk for injured workers, particularly during a pandemic, and optimal outcomes to support a full recovery. If that isn’t reason enough, disparate site-of-care expenses for like surgeries make the equation even more compelling. Consider research published in 2018 comparing the costs for knee and shoulder arthroscopic surgeries across 18 states.1 Findings concluded that in most states, hospital outpatient costs soared 21% to 76% for common knee procedures, and were up to 71% higher for surgical shoulder episodes.
Keep in mind these statistics only account for the “price tag” comparison between sites of care. The rates of readmission, reoperation, and infection compound in a hospital setting and significantly add to the cost of an unmanaged surgical program. Costs are going up, too. Facility expenses have risen substantially over time and the pandemic has decimated hospital income statements even further.
The danger of hospital-acquired infections, from COVID-19 to surgical site infections
A nosocomial infection is an infection or toxin that exists or is acquired in a hospital. People now use nosocomial infections interchangeably with the terms “health-care associated infections” and “hospital-acquired infections.”
There were several studies conducted in April, at the height of the global pandemic, to identify the proportion of essential health care workers who tested positive for COVID-19 as a percentage of all cases. The United Kingdom conducted the most comprehensive survey, which revealed that between 13% and 16% of daily cases were presumed nosocomial or acquired in hospitals.2 By March 25, Spain had already confirmed that 6,500 infections, “roughly 14% of the overall cases by that time,” were suffered by health care workers.3 Although these facts were impactful, they were both limited by testing data and only provided a snapshot in time, leading scientists to believe that in both countries, nosocomial infection rates were higher than 30%. Later, a retrospective study in Wuhan, China estimated that 41% of overall infections were acquired in hospitals.4
Surgical site infections (SSIs) account for more than $3 billion in health care costs per year, with more than 150,000 new cases occurring annually in the United States.5 SSIs increased the median length of stay by 230% and, in turn, all expenses that workers’ compensation professionals tend to manage (EM, surgery, pharmacy, and radiology) followed suit. Infections ultimately drive up the cost of surgery, particularly when the infection is hospital-acquired. The median cost for treatment during the initial hospitalization and readmission for an infected patient was $108,782, compared to $57,418 for the treatment of an uninfected patient. 5
Other Concerns for Hospital-based Surgeries
Infections are top of mind, but only account for one component of readmission expense associated with unmanaged orthopedic surgeries. Readmission and reoperation rates are more common outside of ASCs and drive expenses even higher. Workers Compensation Research Institute (WCRI) recently released preliminary research on common low back surgeries and examined the rate of readmission and/or reoperation embedded in those claims.6 Across the 18 states studied between 2016 and 2018, the research found that reoperation and readmission rates were each 5.5%, respectively, and 4.9% for both. Compounded, 16% of all lumbar spine surgeries, most of which were likely conducted in hospitals, had a negative outcome associated.
Our industry is doing a better job of late, but progress remains slow. ASCs offer better outcomes, improved patient experience, lower claim costs, and fewer risks. The pandemic and the presumption of future outbreaks have only strengthened the case to manage all non-emergent, orthopedic surgical episodes in an ambulatory environment.
About Frank Raneri
Frank Raneri currently serves as Senior Vice President of Network and Client Services for Paradigm Specialty Networks. He oversees the development and growth of Paradigm’s complementary network solutions and the provision of client outcomes therein. Through selective participation, deliberate contracting, active provider development and scoring, Frank’s role is to best position Paradigm’s clients in managing their high acuity programs to improve outcomes and reduce costs.
Frank joined Paradigm in 2019 with more than 18 years of industry experience, particularly focused on the development of workers’ compensation specialty networks. Frank held operational and client-facing leadership roles before joining Paradigm in ancillary services, field case management, and MSP compliance. Frank can be reached at Frank.Raneri@paradigmcorp.com.
For almost 30 years, Paradigm has been the industry leader in solving catastrophic and complex health care challenges and improving lives. With the most connected and experienced team in health care, we define and deliver outcomes that exceed financial and health expectations for our clients, as well as for individuals and their families.
Paradigm delivers its solutions through three divisions: Catastrophic Care Management, Complex Care Solutions, and Specialty Networks. The Paradigm divisions are built on expertise from six best-in-class businesses: Paradigm Outcomes, The ALARIS Group, Encore Unlimited, Restore Rehabilitation, ForeSight Medical, and Adva-Net. Founded in 1991, Paradigm is headquartered in Walnut Creek, California, with offices across the U.S. For more information, please visit https://www.paradigmcorp.com/.
Paradigm Specialty Networks offers innovative, data-driven network solutions for the most challenging, expensive, and unmanaged segments in workers’ compensation: orthopedic and spine, pain management, addiction recovery, post-acute care, behavioral health, and surgical implants.
Paradigm is a WorkCompWire ad partner.
This is not a paid placement.
1WCRI: WCRI Flash Report: Comparing Payments to Ambulatory Surgery Centers and Hospital Outpatient Departments, November 15, 2018
2The Guardian: Up to 20% of hospital patients with COVID-19 caught it at hospital, May 18, 2020
3Reuters: Health workers make up nearly 14% of Spain’s coronavirus cases, March 24, 2020
4Jama Network: Coronavirus Disease 2019 (COVID-2019) Infection Among Health Care Workers and Implications for Prevention Measures in a Tertiary Hospital in Wuhan, China, May 21, 2020
5NCBI: Surgical site infection in orthopedic trauma: A case–control study evaluating risk factors and cost, June 28, 2015
6WCRI: Reoperation & Readmission Rates for WC Patients Undergoing Lumbar Spine Surgery, Lea R, Yang R. 2020.