The Arthroplasty Revenue Collapse: How Orthopedic Practices Are Using RPM and RTM to Fight Back

The math no longer works

In 2001, a primary total knee arthroplasty (TKA) was a financially viable procedure. The time invested, the skill required, and the risk assumed were reflected, imperfectly but adequately, in Medicare's reimbursement.

By 2026, that equation has broken. In nominal dollars, Medicare reimbursement for primary TKA (CPT 27447) has fallen 22.3% since 2000. Adjusted for inflation, the real decline is approximately 53%.¹ Revision procedures tell the same story: revision TKA reimbursement dropped 24.52% through 2019, then accelerated another 26.33% through 2024.¹

Mathematical models forecasting forward to 2030 put the hourly equivalent for primary arthroplasty at $14.97.¹ That number is not a rhetorical device. It is the output of applying standard RUC-determined procedural times to projected conversion factor trajectories.

In 2023, opt-outs of Medicare by high-volume hip and knee arthroplasty surgeons hit their highest annual rate ever recorded.¹ For those who remain, the average net revenue per arthroplasty case in an ambulatory surgery center was approximately $6,419 in 2024.¹ That number will be lower in 2026.

The purpose of this post is not to catalogue the damage. It is to explain why orthopedic practices that understand the structure of CMS's remote monitoring reimbursement system are building a revenue stream that directly offsets these losses, scales in ways that surgical volume cannot, and in several deployment models, runs profitably on the same patient population the practice already serves.

How the conversion factor erosion compounds

The Medicare Physician Fee Schedule conversion factor is the single number that determines what every RVU is worth. In 2019, it was $36.04. In 2025, it was $32.35 — a 2.83% cut driven by the expiration of a temporary Congressional patch. For 2026, CMS restored it partially to $33.40 for practitioners outside qualifying alternative payment models, while simultaneously applying a negative 2.5% efficiency adjustment to surgical and orthopedic codes specifically.²

The efficiency adjustment reflects CMS's position that improved technique and technology have made orthopedic procedures faster. From a reimbursement standpoint, a faster procedure is a less expensive procedure. The work value goes down. The surgeon's hourly equivalent goes further down.

The conversion factor cuts do not occur in isolation. The Medicare Economic Index — CMS's own estimate of practice cost inflation — was projected to rise 3.6% for 2025.² Labor costs for surgical practices climbed an estimated 82% per full-time equivalent between 2013 and 2022.³ When practice costs rise and procedure payments fall, the margin per case compresses from both directions simultaneously.

This is the practice squeeze. Medicare physician payment, adjusted for inflation in actual practice costs, has declined 33% since 2001.³ Surgical specialties absorbed the largest share of that cut.

The global period problem

Orthopedic surgery carries one of the most restrictive billing constraints in all of medicine: the 90-day global surgical package.

For major procedures like TKA and THA, the global period bundles one day of pre-operative care, the day of surgery, and 90 days of routine post-operative care into a single payment. During that window, the billing surgeon cannot separately bill for routine follow-up visits, standard post-operative instructions, wound checks, or routine pain management. The assumption embedded in the global fee is that all of this work is already compensated.

CMS has spent years collecting data suggesting that surgeons are not actually performing all the visits bundled into the 90-day fee. In 2025, CMS finalized a policy requiring use of modifier -54 (Surgical Care Only) for informal care transfers, reducing the surgeon's payment to only the intra-operative component. The regulatory trend is toward paying less, not more, for the post-operative period.

The global period is not just a payment constraint. It is a billing blackout. For 90 days following major joint replacement, the practice's primary revenue source is silent, and the patient requires significant ongoing clinical attention.

This is the structural gap that RTM was built to fill — though not always in the way practitioners initially assume.

RPM and RTM: the revenue architecture

Before examining how orthopedic practices deploy these programs, the billing structure matters.

Remote Physiologic Monitoring (RPM) captures objective physiologic data — blood pressure, weight, blood glucose, oxygen saturation — transmitted automatically from FDA-cleared devices. Only physicians, NPs, and PAs can bill RPM codes. Conditions like hypertension, diabetes, and CHF are the primary indications.

Remote Therapeutic Monitoring (RTM) captures non-physiologic therapeutic data: pain levels, mobility metrics, exercise adherence, functional status. Patients can self-report through an FDA-cleared software application. Critically, RTM billing rights extend to physical therapists (PTs) and occupational therapists (OTs). For orthopedic practices with integrated PT departments, this is the structural advantage.

2026 billing rates:

Code	Description	Rate
CPT 99453	RPM device setup and education (one-time)	~$21.71
CPT 99454	RPM device supply, 16+ days/month	~$52.11
CPT 99445	RPM device supply, 2-15 days/month (new 2026)	~$52.11
CPT 99457	RPM clinical management, first 20 min	~$51.77
CPT 99470	RPM clinical management, 10-19 min (new 2026)	~$26.05
CPT 99458	RPM clinical management, additional 20 min	~$41.42
CPT 98975	RTM device setup and education (one-time)	~$21.71
CPT 98977	RTM device supply, MSK, 16+ days/month	~$40
CPT 98980	RTM clinical management, first 20 min	~$53-54
CPT 98981	RTM clinical management, additional 20 min	~$39-42

A patient generating the foundational combination of device supply and one management tier produces $110 to $140 in monthly reimbursement. At 100 patients, that is $132,000 to $168,000 annually before overhead. The 2026 rule changes also exempted RPM and RTM from the efficiency adjustments applied to surgical codes — a deliberate CMS signal that these programs are investments in reducing downstream costs, not services to be squeezed.

Navigating the global period blackout

The 90-day global period applies to the billing practitioner who performed the surgery. That constraint is real, but it has defined boundaries, and orthopedic practices have four legal avenues to generate remote monitoring revenue within or around that window.

1. Monitoring comorbidities unrelated to the surgery. The global period prohibits billing for routine post-operative care of the surgical condition. It does not prohibit billing for management of unrelated conditions. A patient recovering from TKA who also has hypertension and type 2 diabetes can be enrolled in RPM for those conditions during the 90-day window, provided the monitoring uses distinct diagnosis codes and is medically indicated. The hypertension doesn't stop requiring management because the patient had a knee replaced.

2. Physical therapist billing under a separate NPI. A PT employed by the same orthopedic practice but billing under their own NPI can enroll the post-surgical patient in an RTM program for musculoskeletal rehabilitation during the 90-day global period. The global period restriction does not extend to the PT's NPI. This creates a continuous ancillary revenue stream from MSK monitoring codes (CPT 98977, 98980, 98981) for practices with integrated therapy departments, covering exactly the period when surgical billing is dark.

3. Pre-operative optimization. The global period begins only one day before surgery. Everything prior to that day is separately billable. Practices deploying RPM for pre-surgical optimization — tracking weight, metabolic markers, blood pressure, and mobility in the weeks or months before a joint replacement — bill those services without any global period conflict. The clinical rationale is strong: a patient who enters surgery with controlled hypertension, lower BMI, and better baseline mobility has better outcomes. The billing is clean.

4. Post-global continuation. On day 91, the surgical global period ends. RTM enrollment for ongoing MSK rehabilitation and monitoring begins immediately, generating recurring monthly reimbursement for the same patient through the rehabilitation phase.

These four windows together mean that a joint replacement patient can generate remote monitoring revenue before surgery, through integrated PT billing during recovery, and in the post-global rehabilitation phase. The surgical global period is a billing constraint on one provider's NPI for one set of codes. It is not a barrier to a coordinated monitoring program.

The financial offset in practice

Surgical revenue has a hard ceiling. A surgeon can perform a finite number of arthroplasties per day, and each one produces declining margin as the conversion factor falls and overhead rises. That math does not improve.

Remote monitoring is asynchronous. A single clinical staff member can actively monitor 100 to 250 patients simultaneously. The revenue scales with enrollment, not with operating room time.

Consider the offset math directly. A 10-surgeon orthopedic practice loses $150,000 annually to Medicare conversion factor reductions. To recover that loss through RPM and RTM, the practice needs approximately 178 enrolled patients generating $70 net per patient per month (178 patients x $70 x 12 months = $149,520). For a practice that already manages high volumes of arthroplasty and MSK patients, 178 enrolled monitoring patients is a modest enrollment target.

At larger scale, a single orthopedic surgeon actively managing 100 RPM patients can generate approximately $225,000 in additional gross ancillary revenue per year. A group practice of four to ten physicians with 300 enrolled monitoring patients generates $16,500 to $42,000 per month in remote monitoring revenue. Gross margins on these programs run 60 to 80%. Net margins, even in outsourced models, run 30 to 50%. The payback period on program launch investment is typically four to six months.

What this looks like in practice

Two orthopedic practices have published enough operational detail to be instructive.

JIS Orthopedics (New Albany, Ohio) faced converging pressures: falling MSK reimbursements and a patient population with rising obesity rates that complicated surgical candidacy. The practice partnered with Prescribe FIT to launch a pre-operative RPM program focused on weight management and metabolic optimization. Patients in the program lost over 6,000 pounds combined, improved A1C and mobility metrics, and arrived at surgery in materially better condition. JIS collected over $1 million in insurance reimbursements from RPM CPT codes. The program ran on minimal internal staff resources.

The JIS model illustrates the pre-operative window clearly. These patients needed medical optimization before surgery. RPM provided the monitoring infrastructure and the clinical feedback loop. The reimbursement followed directly from that clinical activity.

Dr. Ahmed Siddiqi at Brielle Orthopaedics (New Jersey) implemented the Force Therapeutics RTM platform for MSK digital care management on THA and TKA pathways. The baseline comparison was stark: standard non-digital post-operative pathways cost the practice approximately $1,400 in overhead per patient. By transitioning to RTM, the practice received average direct reimbursement of $288 per patient from RTM codes. Virtual education and pre-operative monitoring produced cost savings of up to $1,350 per patient before surgery ever occurred.

The aggregate result: the practice identified over $2 million in annual cost savings, and the workflow efficiencies enabled a 30% increase in surgical patient volumes. The monitoring program reduced the administrative friction that previously constrained how many surgical cases the practice could support.

The value-based care dimension

For orthopedic practices operating in TEAM model markets — and as of January 2026, participation in TEAM is mandatory for selected hospitals in designated geographic areas — the financial logic of remote monitoring extends beyond fee-for-service revenue.

Under TEAM, CMS holds hospitals accountable for the total cost of care across 30-day post-surgical episodes, including lower extremity joint replacements. Every readmission within that window is a direct financial loss on the episode. A single prevented readmission for a major joint replacement saves $15,000 to $25,000 in episode costs. An RPM program that costs $200 to $400 per patient and prevents readmissions at even a modest rate generates returns that far exceed its cost.

The 2026 CMS rule changes created short-duration monitoring codes specifically designed for this window. CPT 99445 covers device supply for 2 to 15 transmission days — exactly the acute post-discharge risk period for joint replacement patients, when readmission risk is highest. CPT 99470 covers 10 to 19 minutes of clinical management time. Monitoring a patient for 10 days and discharging them from the program once they stabilize is now a billable episode, not an uncompensated one.

For WISeR model participants in New Jersey, Ohio, Oklahoma, Texas, Arizona, and Washington, RTM provides an additional compliance benefit. WISeR applies algorithmic auditing to orthopedic procedures with high utilization variation, scrutinizing whether surgery was medically necessary. A patient enrolled in RTM before surgery generates a longitudinal record of pain levels, functional deficits, therapy adherence, and the clinical decisions made in response. That data trail is objective documentation that conservative treatment was attempted and monitored. It is not a substitute for clinical judgment, but it is far stronger evidence than narrative documentation alone.

Building the program

The operational requirements for a remote monitoring program that runs defensibly at scale are specific.

Billing logic must handle the code selection automatically. CPT 99445 and CPT 99454 are mutually exclusive depending on whether a patient transmitted data for 2 to 15 days or 16 or more days in a given month. CPT 99470 and CPT 99457 are mutually exclusive depending on whether documented clinical time falls in the 10-to-19-minute range or crosses 20 minutes. These determinations cannot be made reliably by manual review at volume. A system that counts transmission days and aggregates clinical minutes automatically — and routes claims accordingly — is the operational foundation.

Payer verification matters before devices ship. UnitedHealthcare restricted RPM coverage in 2026 to heart failure and gestational hypertension. Shipping a device to a UHC-covered patient with a musculoskeletal diagnosis generates no reimbursable claim and a hardware cost the practice absorbs. Eligibility verification at enrollment, not at claim submission, is the control that prevents that outcome.

Documentation must match billing. Concurrent billing of RPM and CCM in the same month for the same patient is permitted and common in orthopedic populations with comorbid hypertension or diabetes. Combined monthly reimbursement for a patient on both programs can exceed $150. CMS and commercial auditors examine concurrent billing patterns routinely. The clinical notes must show distinct documented activities under each program, with separately tracked time. The billing opportunity is real; the documentation discipline to support it is non-negotiable.

CMS reaffirmed general supervision for RPM and RTM in the 2026 rule. Medical assistants, licensed practical nurses, and contracted care management staff can perform daily data review and patient outreach under physician direction without the physician present during each interaction. This supervision standard is what makes monitoring programs economically viable at the patient volumes required to generate meaningful revenue. Physician-only review of daily monitoring data is neither clinically necessary nor financially sustainable.

The structural argument

Orthopedic surgery faces a reimbursement environment that is structurally hostile and is not getting better. The conversion factor trend is down. Efficiency adjustments target surgical codes specifically. The global period rules compress billing for the 90-day post-operative window. Practice costs continue rising. These are not cyclical pressures that will correct. They are the direction of Medicare payment policy.

Remote monitoring is the inverse. CMS has raised valuation on RPM and RTM codes, exempted them from efficiency adjustments, created short-duration tiers that fit post-acute orthopedic monitoring directly, and built mandatory bundled payment models that make monitoring economically necessary at the hospital level. The policy direction is intentional.

The orthopedic practices that will navigate the next decade successfully are not the ones that find ways to squeeze more arthroplasty volume into shrinking margins. They are the ones that recognize their patient population — large, chronically ill, recovering from major surgery, requiring ongoing MSK management — as the exact population that remote monitoring programs were built to serve, and build the operational infrastructure to capture that revenue systematically.

The surgical revenue will keep declining. The monitoring revenue is ready to scale. The question is whether a given practice has built the program to capture it.

References

Remily EA, et al. "Declining Reimbursement for Total Knee and Total Hip Arthroplasty From 2000 to 2024." Journal of Arthroplasty, 2024. ↩ ↩² ↩³ ↩⁴ ↩⁵
Centers for Medicare & Medicaid Services. "Medicare and Medicaid Programs; CY 2026 Payment Policies Under the Physician Fee Schedule and Other Changes to Part B Payment and Coverage Policies." Federal Register, November 5, 2025. cms.gov/medicare/payment/physician-fee-schedule ↩ ↩²
American Academy of Orthopaedic Surgeons. "Physician Reimbursement and the Medicare Conversion Factor." AAOS Policy Brief, 2025. aaos.org ↩ ↩²