OBJECTIVES: The Comprehensive Care for Joint Replacement (CJR) program from Medicare will pay hospitals a fixed amount to cover all services from admission to 90 days after discharge for TKA to align incentives to reduce hospital costs for this common and increasingly prevalent surgical procedure. The purpose of this study was to examine the impact of using BLIS to manage postsurgical pain after TKA on total hospital costs for Medicare patients. METHODS: This analysis included hospitals from the Premier Database with >500 Medicare patients who received BLIS following primary TKA (ICD-9 procedure code 81.54) between July 1, 2013, and March 31, 2015, and controls from the same hospitals who did not receive BLIS from January 1, 2011, to March 31, 2015. The primary outcome was total hospital costs estimated by Premier using proprietary, hospital-specific, and item-specific charge to cost ratios. Generalized linear mixed models (GLMM) were developed using patient factors as independent variables and hospital to control for random effects; patients with $0 costs were excluded. RESULTS: Five hospitals were included, with sample sizes ranging from 588 to 752 patients in the BLIS group (total 3,359) and 729 to 1,610 (total 5,785) controls. Groups were similar for age, gender, and Charlson Comorbidity Index (CCI), with more whites in the BLIS group (91.0% vs. 79.7%, p<0.001). Mean hospital costs were $823 lower ($16,387 vs. $17,210; p<0.001) for TKA patients who received BLIS. In a GLMM that also included hospital, age, gender, CCI, and race, the use of BLIS was estimated to reduce total hospital costs by $1,020 (p<0.001). CONCLUSIONS: In a sample of five Premier hospitals with high utilization of BLIS for TKA, total hospital costs were significantly lower in patients who received BLIS. Managing postsurgical pain with BLIS could help hospitals to reduce their costs under the CJR program.