SURGICAL PERSPECTIVE
To Cut is to Cure
The Surgeon’s Role in Improving Value
Jeffrey K. Jopling, MD, MSHS,  y Clifford C. Sheckter, MD,  y and Brent C. James, MD, MSTATy
Keywords: health care delivery, quality, value
(Ann Surg 2018;267:817–819)
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SURGEONS WILL INCREASINGLY BEAR FINANCIAL
RISK WITH NEW PAYMENT MODELS
V alue-based reimbursement is supplanting traditional fee-for-
service payment. Forward thinking payers, providers, and
patients are redesigning care delivery to maximize patient experience
and population-level health at an affordable cost (the ‘‘Triple Aim’’).
A National Academy of Medicine report estimates that a minimum of
30%, and potentially over 50%, of all health care spending is waste.1
This waste represents a meaningful target for value transformation,
particularly in surgical care.
To this end, the recently enacted, strongly bipartisan Medi-
care Access and CHIP Reauthorization Act (MACRA) specifically
incentivizes physicians to deliver high-quality care in a cost-effec-
tive and coordinated manner. The Centers for Medicare and Medic-
aid Services (CMS) has established 2 pathways for participation—
the performance-adjusted fee-for-service Merit-Based Incentive
Payment System (MIPS) and the greater risk-sharing Alternative
Payment Models (APMs). Working within the fee-for-service para-
digm, the American College of Surgeons (ACS) has created and
launched the Surgeon Specific Registry (SSR).2 This centralized
database is constructed for use by individual surgeons, enabling
state of the art case tracking and outcomes reporting. Thanks to its
thoughtful design and continued evolution, surgeons can leverage
the database to easily participate in the Quality Payment Program
MIPS.
For surgeons seeking to instead participate in an APM,
episodic (bundled) care pathways are emerging as one of CMS’s
preferred payment mechanisms. Private payers are also experiment-
ing with similar approaches. The Comprehensive Care for Joint
Replacement program’s success to date—along with the ACS pro-
posal that would create bundles for most surgical procedures—
signals momentum for these value-based payment models.3 In order
to succeed clinically and financially, surgeons must understand the
value opportunities across the continuum of surgical care and
actively engage their health systems in designing high value surgical
care delivery.
From the Department of Surgery, Division of General Surgery, Stanford Univer-
sity School of Medicine, Stanford, CA; and yClinical Excellence Research
Center and Stanford University School of Medicine, Stanford, CA.
The authors report no conflicts of interest.
Reprints: Jeffrey K. Jopling, MD, MSHS, Stanford University School of Medicine,
Department of Surgery, 300 Pasteur Drive, H-3691, Stanford, CA 94305.
E-mail: jjopling@stanford.edu.
Copyright ß 2017 Wolters Kluwer Health, Inc. All rights reserved.
ISSN: 0003-4932/17/26705-0817
DOI: 10.1097/SLA.0000000000002596
Annals of Surgery  Volume 267, Number 5, May 2018
Copyright © 2017 Wolters Kluwer Health, Inc. All rights reserved.
EPISODIC REIMBURSEMENT AND FOUR PERIODS
OF VALUE OPPORTUNITY IN SURGICAL CARE
Surgeons are already familiar with episodic payment. Med-
icare’s Diagnosis-Related Group (DRG) payment system covers
hospital care from the operating room through hospital discharge.
Although physician fees flow separately, surgeons currently work
with hospitals to maximize value during inpatient episodes.
Emerging value-based payment models, however, will incen-
tivize value enhancement throughout the full continuum of surgical
care. This continuum spans 4 self-evident phases: preoperative
evaluation, surgery, postoperative inpatient recovery, and post-hos-
pitalization care (postacute care). Waste elimination opportunities
and value improvement strategies exist for all 4 periods (Fig. 1).
Complications undercut the entire continuum, damaging clinical and
cost outcomes for both patients and surgeons.
Preoperative Evaluation and Diagnosis
Three questions guide activity in the preoperative period: is
the patient’s disease best treated with surgery, does the patient want
surgery, and what presurgical measures can ensure the safest opera-
tion with the best outcome? Current bundled payment contracts do
not target preoperative services—episodes begin on the day of
surgery. However, ACS episodic payment proposals include a
‘‘look-back’’ period that evaluates diagnostic resource utilization
before surgery.3 By measuring variation within preoperative care, the
best, most efficient practices can be identified.
The decision to operate must be made from each patient’s
vantage. A ‘‘green-light’’ from anesthesia is necessary for informing
the likelihood of surviving surgery, but medical risk assessment
should include information that can guide preoperative interventions
and operative details. Shared decision making with patients, their
families, and primary care may direct a patient away from surgery, or
delay surgical treatment until the patient is globally fit for surgery.
The ultimate decision to proceed requires viewing the surgical
recommendation vis-a-vis the patient’s complete life.
Episodic bundles pay the same regardless of complications or
repeat surgery. Surgical teams can eliminate a meaningful percentage
of complications by thoughtful upfront care. They can ‘‘fingerprint’’
each condition and procedure, identifying potential generic (eg, deep
vein thrombosis) and case-specific (eg, top hip shaft fracture)
complications. Once identified, surgical teams can explicitly mea-
sure and manage these predicable risks. Useful interventions that go
beyond traditional approaches may include prehabilitation and home
safety assessments before surgery.
Intraoperative
Surgeons have more direct control over operative costs than
any other area. Many surgeons live with an ‘‘ask and get’’ paradigm
in the operating room. As ‘‘buyers,’’ we are often unilateral and
woefully uninformed, choosing complex, expensive technologies not
necessarily supported by evidence of improved clinical outcomes.
Although personal relationships with vendors can influence choices,
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Jopling et al
surgeon unfamiliarity with seller pricing, margins, and supply chains
likely has a more substantial impact on value.4
Over the last century, standardization in the operating room
has dramatically reduced intraoperative complications. A similar
approach can drive value-based selection of instruments and sup-
plies. Recent studies demonstrate that feedback of operating room
supply utilization and costs, sometimes coupled with a small incen-
tive, can reduce overall costs.5 Pioneering groups are now making
costs transparent at the point of care. Others are engaging surgeons in
purchasing decisions, including product selection, sourcing, con-
tracting and, importantly, patient outcomes.
Postoperative Inpatient
Many surgeons attempt to optimize postoperative hospitaliza-
tion, but often without considering value. Surgeons steer patients into
specialized units and familiarize staff with their preferences for
postoperative care. But when every surgeon has a unique approach,
staff can face unnecessary, sometimes overwhelming, complexity.
This complexity can facilitate deviations from best practices and
impair care delivery execution.
True production cost transparency allows teams to unlock
value improvement opportunities. For example, care teams should be
able to easily view medication prices or per-diem costs of intensive
care unit versus surgical floor beds. Some surgical teams have
identified the component elements of a perioperative episode and
priced each item to generate a ‘‘bottom-up’’ true cost associated with
different procedures.6 Other groups have demonstrated that coordi-
nated use of value-based formularies can achieve real savings.7
Finally, multi-intervention enhanced recovery after surgery (ERAS)
programs leverage coordinated, standardized practices to improve
value while speeding patient recovery.8
Post-hospitalization (‘‘Post-acute’’) Care
A series of recent investigations9–11 suggest that postacute
care—even after excluding ambulatory and minor inpatient sur-
gery—may represent the greatest opportunity to improve surgical
value. Three areas are particularly attractive: 1) upfront work in
preoperative phase to obviate need for postacute care, 2) preplanning
with postacute facilities to achieve a limited stay, and 3) specific
goal-directed discharge criteria so that the patients do not remain
admitted solely to exhaust Medicare benefits.11
Care providers now bear financial risk for complications and
readmissions. A structured postdischarge surveillance system can
combat readmissions. Simple ‘‘low-technology’’ solutions, such as
standardized protocols to prevent post-op wound infections or phone
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Annals of Surgery  Volume 267, Number 5, May 2018
FIGURE 1. Value opportunities across
surgical care continuum.
calls for post-op follow-up, have been shown to improve health
outcomes and reduce costs.
VITAL ELEMENTS FOR SUCCESS
As surgeons, we have a choice between leading the value
transformation or yielding to a disruptive trend. As advocates for
surgeon leadership in this endeavor, we recognize the empowering
factors that will facilitate successful surgeon engagement: cost
transparency, surgeon education, and aligned incentives.12 Even in
today’s cost-conscious environment, obtaining meaningful cost data
has proven difficult. There are 2 primary sources of granular cost
data. The first resides in existing hospital-based general cost account-
ing systems that have been adopted in over 1300 US hospitals.13
Their use requires partnering with hospital administration to properly
aggregate and translate the detailed cost data into procedure, surgeon,
and service-line specific costs. The other primary method for under-
standing delivery cost is Time-Driven Activity-Based Costing
(TDABC).6 Best used with high-volume and/or high-cost periopera-
tive episodes, this method maps clinical processes and assigns
personnel and material costs to each step in the process. Surgeon-
led teams around the country have already succeeded in cutting the
cost of care utilizing one of these systems. The ACS is also in the
process of developing a tool to facilitate cost transparency, which
holds the promise of demystifying this crucial financial information.
While working to improve value is conceptually intuitive,
leading successful system and process redesign requires acquisition
of new knowledge, skills, and experience. Along these lines, the ACS
has put out a manual The Optimal Resources for Surgical Quality and
Safety14 that draws on the expertise of over 100 surgeons already
engaged in improving patient care at their institutions. Training
programs available at the regional and national level can also help
fill the educational gap and serve as opportunities to forge relation-
ships with leaders in this field.
Finally, surgeons must be financially supported to perform this
work. Leaders need protected time, and administrators must build
pathways for career advancement in this realm.13 At the very least,
scorecards that track performance on value-based measures mean-
ingful to the surgical team and gain sharing are mechanisms by which
surgeons can be engaged in improving the value of care delivery.5
CONCLUSION
Surgeons play the paramount role in the entire surgical
continuum, shepherding patients throughout their journey. We also
must understand our role within a greater value-centered paradigm of
care. With proper education and support, including access to our own
ß 2017 Wolters Kluwer Health, Inc. All rights reserved.
Annals of Surgery  Volume 267, Number 5, May 2018
cost data and quality outcomes, we should be sufficiently able to lead
these efforts. Specifically, investigations of surgical subepisodes can
yield innovations that allow us to shape the future of surgical care
delivery. Unlocking these value opportunities will help surgical
groups thrive in the new payment landscape. Surgeons can enhance
value through waste elimination, proving again an old truism: a
chance to cut is a chance to cure.
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To Cut is to Cure
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