Bundled Payments for Appendectomy: a Model of Financial Implications to Institutions.

BACKGROUND

Bundled payments are increasingly becoming common in surgery, yet little is known regarding their potential impact on reimbursements for patients presenting with acute appendicitis. This study examines the financial impact of bundled payments for acute appendicitis.

METHODS

This was a retrospective review of all open or laparoscopic appendectomies between July 2014 and June 2017. Patients that were not candidates for surgery were not included in this review.

RESULTS

Of the total 741 patients, 42.1% were diagnosed with complicated acute appendicitis. The median length of stay was 1 day (range, 0 to 21 days). The median hospital cost was $4183 (range, $2075 to $71,023). The 90-day readmission rate was 3.2%, with a mean cost of $5025 per readmission (range, $1595 to $10,795). Length of stay, hospital costs, and 90-day readmissions were significantly higher for complicated versus uncomplicated acute appendicitis. In our current fee-for-service model, hospital reimbursements resulted in margins of - 4.0% to 24.6% depending on the severity of disease. If we assume that bundled payments do not reimburse for readmissions, we estimate that our hospital would incur losses of - 5.7% for patients with acute appendicitis with localized peritonitis and - 20.2% for patients with acute appendicitis with generalized peritonitis.

CONCLUSIONS

As bundled payments become more common, hospitals may incur significant losses for acute appendicitis under a model that does not reflect the heterogeneous nature of patients requiring appendectomies. These losses can range up to - 20.2% for complicated cases. Improving clinical outcomes by reducing readmissions may mitigate some of these anticipated losses.