Drivers of variation in 90-day episode payments after percutaneous coronary intervention: Insights from Michigan hospitals

Abstract

BACKGROUND: Percutaneous coronary intervention (PCI) is a common and expensive procedure that has become a target for bundled payment initiatives. We described the magnitude and determinants of variation in 90-day PCI episode payments across a diverse array of patients and hospitals. METHODS AND RESULTS: We linked clinical registry data from PCIs performed at 33 Michigan hospitals to 90-day episodes of care constructed using Medicare fee-for-service and commercial insurance claims from January 2012 to October 2016. Payments were price standardized and risk adjusted using clinical and administrative variables in an observed-over-expected framework. Hospitals were stratified into quartiles based on average episode payments. Payment components between the highest and the lowest quartiles were compared with identified drivers of variation (ie, index hospitalization/procedure, readmissions, postacute care, and professional fees). Among 40925 90-day PCI episodes, the average risk-adjusted 90-day episode payment by hospital ranged between $22154 and $27205 with a median of $24696 (interquartile range, $24190-$25643). Hospitals in the lowest and the highest quartiles had average episode payments of $23744 and $26504, respectively (difference, $2760). Readmission payments were the primary driver of this variation (46.2%), followed by postacute care (22.6%). Readmissions remained the primary driver of variation in key subgroups, including inpatient and outpatient PCI, as well as PCI for acute myocardial infarction and nonacute myocardial infarction indications. CONCLUSIONS: Substantial hospital-level variation exists in 90-day PCI episode payments. Over half the variation between high- and low-payment hospitals was related to care after the index procedure, primarily because of readmissions and postacute care. Hospitals and policymakers should consider targeting these components when developing initiatives to reduce PCI-related spending.