No Bones About It, Bundled Payments Reduce Costs: Study Shows 20% Cost Reduction

By Remedy Partners – February 1, 2017

A significant study published in the JAMA Internal Medicine at the beginning of the year demonstrates how a health system effectively reduced episodic expenditures through bundled payments by 20 percent. Notwithstanding the rising national costs of joint replacements, Baptist Health System (BHS) saved $20 million over seven years with bundled payments.

The study, from the Perelman School of Medicine at the University of Pennsylvania, co-authored by Dr. Ezekiel Emanuel, combines hospital and Medicare data to evaluate the costs and care quality for nearly 4,000 hip and knee replacement episodes from July 2008 to June 2015. The five-hospital Baptist Health System in San Antonio, Texas saved more than $5,000 per episode, or $20 million in total savings. BHS also improved outcomes during the study by reducing readmissions, emergency department visits, and inpatient prolonged lengths of stay.

Remedy Partners has achieved similar results in a shorter period of time with engaged, aligned, and motivated provider partners across the country. Our experience has shown that hospitals and physician group practices can replicate this success by developing local, focused networks of cooperating providers and committing to optimized workflows.






Drue is Managing Partner for The De Angelis Group.

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