Insurers, doctors testing 1 price, 1 bill for surgery

2013-04-29T00:00:00Z Insurers, doctors testing 1 price, 1 bill for surgeryJackie Crosby Star Tribune (minneapolis) Arizona Daily Star

MINNEAPOLIS - Dr. Richard Golden describes himself as an "avid but poor athlete." His bum knee, however, was making it too painful to jog, downhill ski or play golf.

This winter, the 62-year-old Excelsior, Minn., resident decided to stop putting off surgery and signed up for a new program through Twin Cities Orthopedics that aims to make getting a new knee as uncomplicated as buying a carton of milk.

Golden was quoted an upfront price of $21,000 that covered the entire operation - including surgery, medication, post-op recovery and unlimited physical therapy appointments. And it came on a single bill he could submit to his insurance company. "This is the way to go," said Golden, a neurologist who knows how complicated the medical system can be. "It's like getting an all-inclusive vacation where they think of everything."

The Affordable Care Act is spurring a host of efforts to make health care more patient-friendly and less costly, and the pay-one-price approach is among them. After decades of discussions and small-scale tests, the federal government in February launched a nationwide pilot with 450 health-care organizations to see if bundling payments for a "single episode of care" could help transform a system in which doctors have long been paid for each discrete encounter with patients.

Minnetonka-based UnitedHealthcare is involved in a bundled-price pilot for cancer treatment, while other hospitals and insurers around the country are focused on diabetes, heart disease or pneumonia.

"This is just the beginning," said Rajeev Kapoor of consulting firm A.T. Kearney. "We will see many more of these programs across the nation."

Total-knee-replacement surgery has emerged as a frequent candidate for package pricing because it's a common procedure with wide variation in costs.

The key to making bundled payments work is control over as much of patient care as possible from start to finish. The program appears to be delivering. The $21,000 sticker price is about 30 percent less than what insurance companies in the Twin Cities pay for a typical knee replacement, said Twin Cities Orthopedics CEO Troy Simonson.

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