Trends in Utilization and Medicare Spending on Short-Course Radiation Therapy for Breast and Prostate Cancer: An Episode-Based Analysis From 2015 to 2019

PURPOSE

Evidence supports the value of shorter, similarly efficacious, and potentially more cost-effective hypofractionated radiation therapy (RT) regimens in many clinical scenarios for breast cancer (BC) and prostate cancer (PC). However, practice patterns vary considerably. We used the most recent Centers for Medicare and Medicaid Services data to assess trends in RT cost and practice patterns among episodes of BC and PC.

METHODS AND MATERIALS

We performed a retrospective cohort analysis of all external beam RT episodes for BC and PC from 2015 to 2019 to assess predictors of short-course RT (SCRT) use and calculated spending differences. Multivariable logistic regression defined adjusted odds ratios of receipt of SCRT over longer-course RT (LCRT) by treatment modality, age, year of diagnosis, type of practice, and the interaction between year and treatment setting. Medicare spending was evaluated using multivariable linear regression controlling for duration of RT regimen (SCRT vs LCRT) in addition to the above covariables.

RESULTS

Of 143,729 BC episodes and 114,214 PC episodes, 63,623 (44.27%) and 25,955 (22.72%) were SCRT regimens, respectively. Median total spending for SCRT regimens among BC episodes was $9418 (interquartile range [IQR], $7966-$10,983) versus $13,602 (IQR, $11,814-$15,499) for LCRT. Among PC episodes, median total spending was $6924 (IQR, $4,509-$12,905) for stereotactic body RT, $18,768 (IQR, $15,421-$20,740) for moderate hypofractionation, and $27,319 (IQR, $25,446-$29,421) for LCRT. On logistic regression, receipt of SCRT was associated with older age among both BC and PC episodes as well as treatment at hospital-affiliated over freestanding sites (P < .001 for all).

CONCLUSIONS

In this evaluation of BC and PC RT episodes from 2015 to 2019, we found that shorter-course RT resulted in lower costs than longer-course RT. SCRT was also more common in hospital-affiliated sites. Future research focusing on potential payment incentives encouraging SCRT when clinically appropriate in the 2 most common cancers treated with RT will be valuable as the field continues to prospectively evaluate cost-effective hypofractionation in other disease sites.

Risk Factors for Return to the Emergency Department and Readmission in Patients With Hospital-Diagnosed Advanced Lung Cancer

BACKGROUND

Advanced lung cancer (ALC) is a symptomatic disease often diagnosed in the context of hospitalization. The index hospitalization may be a window of opportunity to improve care delivery.

OBJECTIVES

We examined the patterns of care and risk factors for subsequent acute care utilization among patients with hospital-diagnosed ALC.

RESEARCH DESIGN, SUBJECTS, AND MEASURES

In Surveillance, Epidemiology, and End Results-Medicare, we identified patients with incident ALC (stage IIIB-IV small cell or non-small cell) from 2007 to 2013 and an index hospitalization within 7 days of diagnosis. We used a time-to-event model with multivariable regression to identify risk factors for 30-day acute care utilization (emergency department use or readmission).

RESULTS

More than half of incident ALC patients were hospitalized around the time of diagnosis. Among 25,627 patients with hospital-diagnosed ALC who survived to discharge, only 37% ever received systemic cancer treatment. Within 6 months, 53% had been readmitted, 50% had enrolled in hospice, and 70% had died. The 30-day acute care utilization was 38%.Small cell histology, greater comorbidity, precancer acute care use, length of index stay >8 days, and prescription of a wheelchair were associated with higher risk of 30-day acute care utilization. Age >85 years, female sex, residence in South or West regions, palliative care consultation, and discharge to hospice or a facility were associated with lower risk.

CONCLUSIONS

Many patients with hospital-diagnosed ALC experience an early return to the hospital and most die within 6 months. These patients may benefit from increased access to palliative and other supportive care during index hospitalization to prevent subsequent health care utilization.

Implementation of a Streamlined Care Pathway to Reduce Cost and Length of Stay for Patients Undergoing Endoscopic Transsphenoidal Pituitary Surgery

BACKGROUND

We implemented a streamlined care pathway for patients undergoing endoscopic transsphenoidal (TSA) pituitary surgery. Select patients are recovered in the postanesthesia care unit and transferred to a step-down unit for intermediate neurologic care (INCU), with clinicians trained to manage cerebrospinal fluid leak, diabetes insipidus (DI), and other complications.

METHODS

We evaluated all TSA surgeries performed at 1 academic medical center from 7^th January, 2017 to 30^th March, 2020, collecting patient factors, tumor characteristics, cost variables, and outcomes. The INCU pathway was implemented on 7^th January 2018. Pathway patients were compared with nonpathway patients across the study period. Outcomes were assessed using multivariate regression, adjusting for patient and surgical characteristics, including intraoperative cerebrospinal fluid leak, postoperative DI, and tumor dimensions.

RESULTS

One hundred eighty-seven patients were identified. Seventy-nine were on the INCU pathway. Mean age was 53.5 years. Most patients were male (66%), privately insured (62%), and white (66%). Mean total cost of admission was $27,276. Mean length of stay (LOS) was 3.97 days. Use of the INCU pathway was associated with total cost reduction of $6376.33 (P < 0.001, 95% confidence interval [CI]: $3698.21-$9054.45) and LOS reduction by 1.27 days (P = 0.008, 95% CI: 0.33-2.20). In-hospital costs were reduced across all domains, including $1964.87 in variable direct labor costs (P < 0.001, 95% CI: $1142.08-$2787.64) and $1206.52 in variable direct supply costs (P < 0.001, 95% CI: $762.54-$1650.51). Pathway patients were discharged earlier despite a higher rate of postoperative DI (25% vs. 11%, P = 0.011), with fewer readmissions (0% vs. 6%, P = 0.021).

CONCLUSIONS

A streamlined care pathway following TSA surgery can reduce in-hospital costs and LOS without compromising patient outcomes.

In-Hospital Costs for Open versus Endoscopic Endonasal Approach for Craniopharyngioma Resection

OBJECTIVE

To determine the in-hospital cost implications of an expanded endoscopic endonasal approach (EEEA) for craniopharyngioma resection relative to the traditional open transcranial approach.

METHODS

All craniopharyngioma surgeries performed at a single institution over a period from January 1st 2001 to October 31th 2017 were evaluated. The electronic medical record was reviewed for patient factors, tumor characteristics, and cost variables associated with each hospital stay and univariate regression analysis was performed using R software.

RESULTS

Thirty-six patients met study criteria, including 22 undergoing an open approach and 14 undergoing an EEEA. There was a significantly longer average length of stay among patients undergoing open resection (21.5 vs. 10.6 days, p = 0.024). The average total in-hospital cost of a patient undergoing an EEEA was $58979.3 compared to $89142.3 for an open approach (p = 0.127). On univariate regression analysis, the total in-hospital cost for a patient undergoing an open approach relative to an EEEA was $30163.0 (p = 0.127). The open approach was exclusively performed from study onset until April 2010 (16 patients). From April 2010 to August 2013, 6 open approaches and 5 EEEA were performed. The EEEA has been exclusively performed from August 2013 until the conclusion of our study period (9 patients).

CONCLUSIONS

There has been a shift toward surgical resection of craniopharyngioma via an EEEA approach for amenable tumors. Our study demonstrates that the EEEA has become the preferred surgical approach at our institution, and shows that the EEEA is associated with shorter postoperative length of stay and lower total in-hospital cost. Laryngoscope, 133:83-87, 2023.

Medicare reimbursement trends from 2000 to 2020 in head and neck surgical oncology

Background

Considering limited data exploring reimbursement trends at the subspecialty level within head and neck surgical oncology, we sought to characterize these trends for head and neck‐specific codes from 2000 to 2020.

Methods

Using the Centers for Medicare and Medicaid Services' Physician Fee Schedule Look‐Up Tool, reimbursement data, adjusted to 2020 U.S. dollars, for 37 head and neck surgical oncologic procedure codes were collected from 2000 to 2020.

Results

From 2000 to 2020, despite gross reimbursement for all head and neck procedures increasing by 23.2%, when adjusted for inflation, physician reimbursement decreased by 19.4%. Only 4 of 37 examined codes increased in net reimbursement over the study period.

Conclusion

Medicare reimbursement for the most common head and neck oncologic procedure codes decreased from 2000 to 2020. Further research is necessary to explore the implications of these trends on the delivery of patient care.

In-Hospital Costs Associated With an Expanded Endonasal Approach to Anterior Skull Base Tumors

Objective:

To determine in-hospital costs associated with performing an EEA to anterior skull base pathology and to identify drivers of cost variability for patients undergoing endoscopic anterior skull base surgery.

Methods:

All endoscopic anterior skull base surgeries performed over a period from January 1st, 2015 to October 24th, 2017 were evaluated. The electronic medical record was reviewed for patient factors, tumor characteristics, and cost variables associated with each hospital stay and univariate analysis was performed using Stata software.

Results:

An EEA was associated with an average total in-hospital cost of $44 545. Compared to patients undergoing a transsphenoidal approach to pituitary tumor resection, EEA patients incurred higher in-hospital costs across all variables including a total cost increase of $15 921 (95% confidence interval $5720-26 122, P = .002). Univariate analysis of all endoscopic anterior skull base surgery patients showed a cost increase of $30 616 associated with post-operative cerebrospinal fluid (CSF) leak ($10 420-50 811, P = .004), $14 610 with post-operative diabetes insipidus (DI) ($4610-24 609, P = .004), and $11 522 with African-American patients relative to Caucasian patients ($3049-19 995, P = .008).

Conclusions:

Patients who undergo endoscopic EEA for resection of anterior skull base tumors typically incur greater in-hospital costs than patients undergoing a standard TSA. Post-operative complications such as CSF leak and DI, as well as ethnicity, are significant drivers of cost-variability.

Time-Driven Activity-Based Costing in Breast Cancer Care Delivery

BACKGROUND

Accurate measurement of healthcare costs is required to assess and improve the value of oncology care.

OBJECTIVES

We aimed to determine the cost of breast cancer care provision across collaborating health care organizations.

METHODS

We used time-driven activity-based costing (TDABC) to calculate the complete cost of breast cancer care-initial treatment planning, chemotherapy, radiation therapy, surgical resection and reconstruction, and ancillary services (e.g., psychosocial oncology, physical therapy)-across multiple hospital sites. Data were collected between December 2019 and February 2020. TDABC steps involved (1) developing process maps for care delivery pathways; (2) determine capacity cost rates for staff, medical equipment, and hospital space; (3) measure the time required for each process step, both manually through clinic observation and using data from the Real-Time Location System (RTLS); and (4) calculate the total cost of care delivery.

RESULTS

Surgical care costs ranged from $1431 for a lumpectomy to $12,129 for a mastectomy with prepectoral implant reconstruction. Radiation therapy was costed at $1224 for initial simulation and patient education, and $200 for each additional treatment. Base costs for chemotherapy delivery were $382 per visit, with additional costs driven by chemotherapy agent(s) administered. Personnel expenses were the greatest contributor to the cost of surgical care, except in mastectomy with implant reconstruction, where device costs equated to up to 60% of the cost of surgery.

CONCLUSION

The cost of complete breast cancer care depended on (1) treatment protocols; (2) patient choice of reconstruction; and (3) the need for ancillary services (e.g., physical therapy). Understanding the actual costs and cost drivers of breast cancer care delivery may better inform resource utilization to lower the cost and improve the quality of care.

A field guide to U.S. healthcare reform: The evolution to value-based healthcare

OBJECTIVE

A consolidated state-of-the-art review of U.S. healthcare reform efforts that documents the evolution towards value-based healthcare (VBH) is lacking in peer-review literature. This field guide attempts to clarify working definitions and conceptual boundaries within the lexicon of U.S. healthcare reform efforts that predated and have common thematic perspectives within the evolving VBH reform paradigm.

DATA SOURCES

Pubmed/MEDLINE/Google search.

REVIEW METHODS

Pubmed/MEDLINE/Google search was performed during August 1, 2020-January14, 2021 for U.S. healthcare reform terms, legislative and government agency publications. Those citing relevant legislative, regulatory, philosophical and technological advancements integral to the development and function of VBH were catalogued according to the targeted stakeholders and evolving reform strategy or technology.

CONCLUSIONS

Eight healthcare reform paradigms were identified as influential precursors to VBH: Patient-Centered Care Model, Patient-Centered Medical Home, Population Health, Personalized Medicine, P4 Medicine, Precision Medicine, Managed Care, and Accountable Care. Several of these models have similar nomenclature and, confusingly, many have multiple interpretations of the terms used to describe these models. However, consistent stakeholders identified within these paradigms are key to VBH; notably the patient, the physician and the payer (the "Big 3"). Demonstrable healthcare spending reductions have been best achieved when the Big 3 stakeholder interests are aligned within healthcare reform legislation. The definition of "Value" within each reform model was found to be based upon the perspective of the targeted stakeholder. Within VBH, the perspectives of the Big 3 stakeholders form a multidimensional meaning of "Value" that can be represented by the equation Value = Patient Experience Management 3 .

Analysis of 20-Year Trends in Medicare Reimbursement for Reconstructive Microsurgery

BACKGROUND

 Microsurgery is being increasingly utilized across surgical specialties, including plastic surgery. Microsurgical techniques require greater time and financial investment compared with traditional methods. This study aimed to evaluate 20-year trends in Medicare reimbursement and utilization for commonly billed reconstructive microsurgery procedures from 2000 to 2019.

MATERIALS AND METHODS

 Microsurgical procedures commonly billed by plastic surgeons were identified. Reimbursement data were extracted from The Physician Fee Schedule Look-Up Tool from the Centers for Medicare and Medicaid Services for each current procedural terminology (CPT) code. All monetary data were adjusted for inflation to 2019 U.S. dollars. The average annual and total percentage changes in reimbursement were calculated based on these adjusted trends. To assess utilization trends, CMS physician/supplier procedure summary files were queried for the number of procedures billed by plastic surgeons from 2010 to 2018.

RESULTS

 After adjusting for inflation, the average reimbursement for all procedures decreased by 26.92% from 2000 to 2019. The greatest mean decrease was observed in CPT 20969 free osteocutaneous flaps with microvascular anastomosis (-36.93%). The smallest mean decrease was observed in repair of blood vessels with vein graft (-9.28%). None of the included procedures saw an increase in reimbursement rate over the study period. From 2000 to 2019, the adjusted reimbursement rate for all procedures decreased by an average of 1.35% annually. Meanwhile, the number of services billed to Medicare by plastic surgeons across the included CPT codes increased by 42.17% from 2010 to 2018.

CONCLUSION

 This is the first study evaluating 20-year trends in inflation-adjusted Medicare reimbursement and utilization in reconstructive microsurgery. Reimbursement for all included procedures decreased over 20% during the study period, while number of services increased. Increased consideration of these trends will be important for U.S. policymakers, hospitals, and surgeons to assure continued access and reconstructive options for patients.

The Costs of Breast Reconstruction and Implications for Episode-Based Bundled Payment Models

BACKGROUND

Implementation of payment reform for breast reconstruction following mastectomy demands a comprehensive understanding of costs related to the complex process of reconstruction. Bundled payments for services to women with breast cancer may profoundly impact reimbursement and access to breast reconstruction. The authors' objectives were to determine the contribution of cancer therapies, comorbidities, revisions, and complications to costs following immediate reconstruction and the optimal duration of episodes to incentivize cost containment for bundled payment models.

METHODS

The cohort was composed of women who underwent immediate breast reconstruction between 2009 and 2016 from the MarketScan Commercial Claims and Encounters database. Continuous enrollment for 3 months before and 24 months after reconstruction was required. Total costs were calculated within predefined episodes (30 days, 90 days, 1 year, and 2 years). Multivariable models assessed predictors of costs.

RESULTS

Among 15,377 women in the analytic cohort, 11,592 (75 percent) underwent tissue expander, 1279 (8 percent) underwent direct-to-implant, and 2506 (16 percent) underwent autologous reconstruction. Adjuvant therapies increased costs at 1 year [tissue expander, $39,978 (p < 0.001); direct-to-implant, $34,365 (p < 0.001); and autologous, $29,226 (p < 0.001)]. At 1 year, most patients had undergone tissue expander exchange (76 percent) and revisions (81 percent), and a majority of complications had occurred (87 percent). Comorbidities, revisions, and complications increased costs for all episode scenarios.

CONCLUSIONS

Episode-based bundling should consider separate bundles for medical and surgical care with adjustment for procedure type, cancer therapies, and comorbidities to limit the adverse impact on access to reconstruction. The authors' findings suggest that a 1-year time horizon may optimally capture reconstruction events and complications.

Feasibility of an Enhanced Recovery After Surgery (ERAS) pathway for major head and neck oncologic surgery

OBJECTIVES

Enhanced Recovery After Surgery (ERAS) protocols are gaining traction in the field of head and neck surgery following success in other specialties. Various institutions have reported on the feasibility of implementation and early outcomes in their centers. We report our experience of setting up an ERAS program in a high-volume tertiary cancer care center, including the challenges faced and overcome.

METHODS

With multidisciplinary input, an ERAS protocol was developed consisting of pre-, intra-, and post-operative interventions based on current evidence. We then assessed an initial series of 104 patients on the ERAS protocol and tracked the compliance rates for various interventions.

RESULTS

Compliance rates to interventions including pre-operative medication (84.6%), multimodal analgesia (84.6%95.1%), early removal of urinary catheters (76.0%) and early mobilization (56.7%) show a wide variation. However, response rates in the assessment of patient-reported outcomes are low. We discuss factors surrounding the feasibility of implementing an ERAS protocol and tracking outcomes in a diverse, high volume center.

DISCUSSION

While there are challenges in implementation, results indicate that a successful ERAS pathway in major head and neck oncologic surgery is feasible. Engaging shareholders and making full use of technology in the form of electronic medical systems are essential to this success.

IMPLICATIONS FOR PRACTICE

ERAS pathways should be encouraged in head and neck surgery, given their proven feasibility in a range of institutions. Further study is needed to confirm this program's impact on outcomes.

Enhanced Recovery After Surgery (ERAS) in Head and Neck Oncologic Surgery: A Case-Matched Analysis of Perioperative and Pain Outcomes

BACKGROUND

Enhanced recovery after surgery (ERAS) pathways are well established in certain surgical specialties because findings have shown significant improvements in outcomes. Convincing literature in head and neck cancer (HNC) surgery is lacking. This study aimed to assess the effect of an ERAS pathway on National Surgical Quality Improvement Program (NSQIP)-based occurrences and pain-related outcomes in HNC surgery.

METHODS

The study matched 200 patients undergoing head and neck oncologic surgery on an ERAS pathway between 1 March 2016 and 31 March 2019 with control subjects (1:1 ratio) during the same period. Demographic and perioperative data collected from the NSQIP database were extracted. Pain scores and medication usage were electronically extracted from our electronic medical record system and compared. Risk factors for high opioid usage also were assessed.

RESULTS

Both groups were statistically similar in baseline characteristics. The ERAS group had fewer planned intensive care unit (ICU) admissions (4% vs. 14%; p < 0.001), a shorter mean hospital stay (7.2 ± 2.3 vs. 8.7 ± 4.2 days; p < 0.001), and fewer overall complications (18.6% vs. 27.0%; p = 0.045). Morphine milligram equivalent requirements over 72 h were significantly reduced during 72 h in the ERAS group (138.8 ± 181.5 vs. 207.9 ± 205.5; p < 0.001). In the multivariate analysis, the risk factors for high opioid analgesic usage included preoperative opioid usage, age younger than 65 years, race, patient-controlled analgesia use, and ICU admission.

CONCLUSION

The study findings showed that ERAS in HNC surgery can result in improved outcomes and resource use, and that these results are sustainable. The outcomes described in this report can be further used to optimize ERAS pathways.

Drivers of In-Hospital Costs Following Endoscopic Transphenoidal Pituitary Surgery

OBJECTIVE

To characterize the patient and clinical factors that determine variability in hospital costs following endoscopic transphenoidal pituitary surgery.

METHODS

All endoscopic transphenoidal pituitary surgeries performed from January 1, 2015, to October 24, 2017, with complete data were evaluated in this retrospective single-institution study. The electronic medical record was reviewed for patient factors, tumor characteristics, and cost variables during each hospital stay. Multivariate linear regression was performed using Stata software.

RESULTS

The analysis included 190 patients and average length of stay was 4.71 days. Average total in-hospital cost was $28,624 (95% confidence interval $25,094-$32,155) with average total direct cost of $19,444 ($17,136-$21,752) and total indirect cost of $9181 ($7592-$10,409). On multivariate regression, post-operative cerebrospinal fluid (CSF) leak was associated with a significant increase in all cost variables, including a total cost increase of $40,981 ($15,474-$66,489, P = .002). Current smoking status was associated with an increased total cost of $20,189 ($6,638-$33,740, P = .004). Self-reported Caucasian ethnicity was associated with a significant decrease in total cost of $6646 (-$12,760 to -$532, P = .033). Post-operative DI was associated with increased costs across all variables that were not statistically significant.

CONCLUSIONS

Post-operative CSF leak, current smoking status, and non-Caucasian ethnicity were associated with significantly increased costs. Understanding of cost drivers of endoscopic transphenoidal pituitary surgery is critical for future cost control and value creation initiatives.

LEVEL OF EVIDENCE

3 Laryngoscope, 131:760-764, 2021.

Automated Big Data Analytics for the Radiation Oncology Alternative Payment Model Proposal Using a Novel Health Care Software Technology

INTRODUCTION:

The proposed Radiation Oncology Alternative Payment Model (RO-APM) aims to test prospective episode-based payments for radiotherapy episodes. Practices will need a tool that can calculate historical episode reimbursements to succeed in this new model. An automated software-based technology was created to calculate historical episode reimbursements within a large Network of community oncology practices.

MATERIALS AND METHODS:

Claims data between January 1, 2017, and July 31, 2019, were cleaned, organized into episodes, and analyzed with a series of Python computer programs per proposed RO-APM methodology. Averaged Winsorized historical episode reimbursements were first calculated over the entire Network, then over 24 of the largest Practices, and then rerun after application of Clinical Rules to remove misattributed episodes.

RESULTS:

A total of 79,418 RO-APM–defined episodes were generated from 6,512,375 claims lines. A total of 7,086 episodes (8.9%) were removed because of no treatment delivery code within 28 days of treatment planning. The Network of practices had more bone metastases, and breast, cervical, and uterine cancers but less lung and prostate cancer than the RO-APM dataset. Combination-modality episodes were more costly and required more providers than single-modality episodes. Clinical Rules reattributed 2,495 episodes (3.4%) and increased episode reimbursement by +5.8% over all disease sites (+3.7% using volume weighting; P = .001).

CONCLUSION:

As payment models continue to shift from volume to value, practices will need an automated analytics technology to measure historical costs and prepare for operational and financial transformation. This automated approach can be adapted to future versions of the RO-APM. Our analysis suggests that future iterations of the RO-APM could incorporate Clinical Rules to remove misattributed palliative care episodes and could implement a separate payment for episodes with multiple radiation therapy modalities.

Clinical Factors Associated With Cost in Head and Neck Cancer: Implications for a Bundled Payment Model

PURPOSE:

To determine which factors influence cost in head and neck cancer (HNC) to inform the development of a bundled payment model (BPM).

METHODS:

Patients with stages 0 to IVB (by American Joint Commission on Cancer, 7th edition) HNC of various sites and histology treated definitively at a single tertiary care center during 2013 were included. Clinical variables and direct cost data were obtained, and their associations were investigated using χ2, t, Wilcoxon rank sum, and analysis of variance testing. Results were used to develop a BPM.

RESULTS:

One hundred fifty patients were included; 87% were white, 74% were men, 48% had oropharyngeal cancer, and 58% had stage IVA disease. Treatment consisted of surgery alone (17%), radiation alone (11%), surgery plus radiation (14%), chemoradiation (45%), and surgery plus chemoradiation (13%). On multivariable analysis, both increasing group stage and number of treatment modalities used were significantly associated with higher cost. Given that stage often dictates treatment, we developed three cost tiers that were based on overall treatment modality. Tier A, the least costly, consisted of single-modality therapy with either surgery alone or radiation alone (median cost divided by the median overall cost of treatment, 0.54; 25th to 75th percentile range, 0.29 to 1.02), followed by tier B, which consisted of bimodality therapy with either chemoradiation or surgery plus radiation (1.03; range, 0.81 to 1.35), followed by tier C, which consisted of trimodality therapy with surgery plus chemoradiation (1.43; range, 1.10 to 1.96).

CONCLUSION:

The number of treatment modalities required is the primary driver of cost in HNC. These data can simplify development of a comprehensive HNC BPM.

Bundled Payments in Otolaryngology: Early Lessons from Arkansas

The Medicare Access and CHIP Reauthorization Act (MACRA) of 2015 established value-based reimbursement as the new norm in health care. As part of this shift, public and private insurers have adopted bundled payments in an effort to improve quality and control cost. Arkansas recently implemented an otolaryngology-specific bundled payment, which reimburses episodes of care involving adenoidectomy and/or tonsillectomy. In this mandatory model, otolaryngologists have the potential for shared savings or losses based on spending relative to risk-adjusted historical benchmarks and performance on quality metrics. The initiative has resulted in reduced health care costs and rates of postoperative antibiotic prescription and secondary bleeding. However, this experiment also illustrates potential pitfalls with bundled payments, such as emphasis of quality metrics lacking clinical relevance and incentive for increased service volume. The Arkansas initiative offers important lessons for otolaryngologists as ongoing reform under MACRA brings episode-based care to the forefront of our field.