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New Regional Data Research: More Than $10,000 Difference in Commercial Bundled Costs for Total Joint Replacement

Wednesday, February 17, 2016


While much data has been released by the Centers for Medicare and Medicaid Services (CMS) on how total joint replacement (TJR) bundled costs differ regionally for Medicare patients, data on commercial bundles has been more limited.

But as private insurers, in addition to government payers, apply bundled payment policies to their contract negotiations, commercial data and analysis become increasingly important as both providers and payers prepare for the trend.

In the new Truven Health AnalyticsTM research brief, Bundled Pricing for Total Joint Replacements (TJRs) in the Commercially Insured Population: Geographic Variation and Cost-Driver Insights, we’ve tackled the subject with simulated bundled pricing based on our proprietary commercial claims database and the nine U.S. Census divisions. Our bundles included inpatient hospitalization, post-acute care, and readmission costs.

The study found there is a nearly 30-percent variation in commercial-patient TJR bundled costs across census divisions, from nearly $30,000 per patient to more than $40,000.

Specifically, our analysis showed that the average TJR bundled cost in the commercial population ranged from $29,825 in the East South Central division to $40,431 in the Middle Atlantic — a difference of more than $10,500 per patient.

It is not surprising that this geographic variation research raised significantly more questions about why cost variation exists. We will be addressing those additional questions about cost-drivers, length-of-stay impact, and more in coming research briefs in this series and in future blog posts. You can download the first brief here.

In addition, if you’d like to be alerted via email when additional commercial bundled pricing research is released, please provide us with your information via

Bob Kelley

Senior Research Fellow, Advanced Analytics