Why Focus on Episodes of Care?

A better health system will provide the best possible care at the lowest cost.

The practice of paying for volume, not value, often results in expensive and unnecessary tests or services instead of more effective and strategic ways to keep patients healthy. In recent years, alternative methods of payment have gained ground as rising costs inch toward economically unsustainable levels.

Episodes of care are the foundation for developing bundled payments, which means that all of the services for a specific event or condition, like a knee replacement, are combined into a single payment instead of being billed individually between pre-op, surgery fees and post-op care. Many in the health care system believe that this type of “all-in” payment model, focused on value and outcomes, not the number of visits, is a necessary step toward improving care and lowering costs.

CIVHC can help stakeholders create new payment models like bundled payments using CO APCD data and analytic tools that help establish baseline episode costs and quality information. We use PROMETHEUS methodology to identify episodes of care by separating typical episode costs from Potentially Avoidable Costs (PACs) and pinpointing opportunities for savings.

In addition, CIVHC uses PROMETHEUS episode methodology to calculate prices consumers can expect to pay for common health care services like colonoscopies and knee replacements. Showing consumers what the total “episode” bill will be from pre-op services through recovery helps them be more informed shoppers. Click here to shop for care.

Featured Change Agent: Colorado PERA

It is estimated that by 2030, Colorado’s population over the age of 65 will increase by 150 percent. Colorado is known for being an active state, and as the demographics of the population shift, the demand for costly joint replacement procedures is likely to grow.

Across the nation and in Colorado, prices for knee and hip replacements vary widely. According to comedprice.org, out-of-pocket cost for knee replacements in Colorado can be anywhere from $20,000 – $58,000, while hip replacements can be as low as $21,000 and as high as $36,000. The Colorado Public Employees’ Retirement Association (PERA), a self-insured organization, is proactively addressing variation in joint replacement cost and quality through their PERACare Select Program for Hips and Knees.

Click to view the full Change Agent profile, or click here to listen to Colorado Pera's Change Agent Chat.

Plaintalk Blog: Bundled Payments

Click here to read our Plaintalk Blog on Bundled Payments