Written by Laura Dyrda
In 2010, the Integrated Health Association launched a bundled payment program for orthopedic procedures in the state that would cover commercially-insured individuals younger than 65. At the time, the program was widely accepted at hospitals across the state and stakeholders hoped it would improve quality and lower costs.
However, it didn’t take long for the program to fall on its face with hospitals and health plans dropping out. The Agency for Research and Quality supported a study of the program, and concluded it there wasn’t enough data gathered to determine whether the program made an impact on quality or cost.
There were several issues with the program, including regulatory delays to approve contracts and a lack of consensus about which procedures to bundle. However, the report also noted stakeholders were still interested in pursuing bundled payments. So how can they make this new model work?
That’s where the experts come in — and a few of them aren’t far from the large hospitals and health systems who pursued the 2010 bundled payments in California.
Hoag Orthopedic Institute in Irvine, Calif., has been offering bundled payments since 2008 to attract medical tourists and self-pay individuals, according to an article published in Becker’s Spine Review. Bundled payments at the orthopedic-specialty hospital were led by James Caillouette, MD, surgeon-in-chief, and are largely considered successful. He also sat on the advisory board for the Integrated Healthcare Association’s pilot project in involving several payers and was instrumental in creating an agreement between HOI, Aetna and McKesson for bundling knee and hip replacements.
