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A New Payment Model For Knee Replacements (And Potentially A Lot More)

Alan Cleaver/Flickr
Alan Cleaver

In the Charlotte area, BlueCross BlueShield and Novant Health are setting up a new payment program for knee replacements that they say will save patients money. It's called a bundled payment program, and you could be hearing that phrase a lot more in the future.

For patients, replacing a knee can be a daunting and expensive process, with lots of appointments, therapy and bills.

BlueCross spokesman Lew Borman says his company and Novant Health are simplifying at least one part of that - the bill.

"The surgery itself and the rehab that follows – under bundled payment schedule, that's all one price," Borman says.

Bundled payment means BlueCross and Novant will lump all the charges together from the day of surgery through the first three months of recovery, including follow-up appointments, physical therapy and any complications.

Derek Goldin of Novant Health says this is the new payment model in health care.

"This is very consistent with what we see Medicare moving towards as a way of realigning the health care system," he says.

The idea is that by charging one price for multiple services, you incentivize providers to make sure they get each right the first time. If not, they're on the hook for expensive complications.  

Goldin says a key is using nurses, social workers and other staff to keep up with the patients.

"Care coordination staff will be following patients day of surgery, post-surgery, post-discharge, checking in with the patient and ensuring that those patients' needs are met at each step in the recovery process," he says.

BlueCross says about 1,000 North Carolina customers used this approach for knee replacements last year. The prices they paid varied based on their exact plan, and that'll still be the case. BlueCross says customers generally saved 10 to 30 percent.