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'Bundled payment' experiment by Bedford Surgery Center, Harvard-Pilgrim insurance

By David Brooks, The Telegraph, Nashua, N.H.
McClatchy-Tribune Information Services

May 23--BEDFORD -- You wouldn't buy a car if you didn't know the cost until after you got home with it, so why do it with a colonoscopy?

That's one of the arguments for a pilot program between Bedford Ambulatory Surgery Center and Harvard-Pilgrim Healthcare, in which routine colonoscopies are covered by a fixed "bundled payment" decided in advance that covers all parties, including surgeons, anesthesiologists and other clinicians. This differs from the usual practice of totalling up fees and costs from the various services involved to create an after-the-fact bill.

"I think more and more bundled programs will be coming down the way -- it simplifies the system, reduces confusion, it's all up front," said Chris Henderson, Bedford Ambulatory Surgery Center's director of business strategy.

The pilot program, available to Harvard-Pilgrim customers, is prodded in part by changes in the health care system because of the Affordable Care Act and other initiatives. One result is more transparency about costs and thus cost shopping by patients, particularly for optional procedures like a routine colonoscopy.

"When physicians have a conversation with the patient and the patient asks for pricing -- that's easy," he said. "There are transparency initiatives underway by many of the health plans because more patients are asking how much is this going to cost me?"

The program has more than one bundle charge, based on various patient risk factors, but the actual charge for the colonoscopies isn't being made public to non-patients at this point.

From Harvard Pilgrim's point of view, the program has to potential to cut costs by giving health-care providers incentives, and ways, to improve communication and outcomes, because more work won't automatically translate into more income.

"Everybody has the information they need, so there's not multiple tests ordered for the same thing. Everybody on the team (knows) we need to live within this budget; there isn't an endless writing of checks,." said William Brewster, New Hampshire medical director for Harvard Pilgrim, and a practicing primary care physician. "We see it as a way to get everybody to have some skin in the game."

The idea of a set payment for a medical procedure, from insurers or other payers, is hardly new, but the concept has been dogged by concerns that it leads to reduced care or to the shifting of actual costs onto other patients whose payments aren't limited. The hope is that well-designed programs of bundled payments will avoid problems associated with more blunt pay-per-patient systems called capitation.

Harvard-Pilgrim hopes that its Bedford Surgery Center pilot, which has handled 44 patients as of earlier this year, will hone methods and systems to maintain quality while cutting actual costs, not just shifting them.

They started the pilot with screening colonoscopies -- the unpleasant but not dangerous process in which a camera on a flexible tube, known as an endoscope, is inserted into an anesthetized patient to examine the colon for signs of cancer -- because it is well-understood with relatively few complications.

Brewster said maintaining quality is easier because of the existence of quantifiable benchmarks for colonoscopies, such as reporting on polyps, presence of anesthesiologists when necessary, and detailed observation of the entire colon.

Just as importantly, he said, it establishes a framework in which all the parties communicate and can share patient records.

Bedford Ambulatory Surgery Center is an independent facility opened in 1993 and owned by its surgeons, although it has a relationship with Catholic Medical Center. It performs a wide variety of surgeries, including orthopedic, pediatric and podiatric, in which the patient can return home within 23 hours -- hence "ambulatory" in the title.

David Brooks can be reached at 594-6531 or dbrooks@nashua telegraph.com. Also, follow Brooks on Twitter (@GraniteGeek).

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(c)2014 The Telegraph (Nashua, N.H.)

Visit The Telegraph (Nashua, N.H.) at www.nashuatelegraph.com

Distributed by MCT Information Services

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