Better outcomes at lower costs. That's the mantra of the orthopedic
bundled payment model. By their nature, bundles reward high-quality
work at a much lower cost and encourage us to take exceptional care
of our patients. But when patients hear "bundle," for some reason
they think they're getting a no-frills, bargain-basement joint replace-
ment. In actuality, of course, they're getting our very best care
because we, the providers, not the payers, are assuming all the clini-
cal and financial risk of surgery that payers traditionally managed.
The most common type of bundle is the prospective bundle, so
named because you prospectively assume that, if all goes according to
plan and there are no complications, x is the cost for the payer and y is
the cost for each individual component of care. To succeed with a
prospective bundle, you must eliminate waste and reduce unnecessary
spending by closely managing the patient and standardizing care.
The math is 3rd-grade simple: Providers who cut healthcare costs
and meet quality metrics might share in the savings, whereas
providers who go over budget or do not meet quality metrics might
see a financial loss on care episodes. But it's not just addition and sub-
traction between payer and provider. It's a continuum of care involv-
ing payer, provider and patient, as well as the hospital or surgery cen-
ter, rehab, durable medical equipment (DME) suppliers and all others
involved in the patient's care in ways small and not so small.
Save a bundle
I oversee the commercial and Medicare bundled payment programs
for OrthoCarolina, a 150-surgeon multispecialty orthopedic group.
OrthoCarolina negotiates bundles with payers and then essentially
subcontracts out the ancillary care for an agreed-upon, fixed price to
the surgical facility (surgical center or hospital, which also pays for
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