Bundled Payments in WC Just a Matter of Time?

Tuesday, November 3, 2015 | 1

Bundled payments — in which a provider receives a flat fee for treating a worker's injury rather than filing claims for individual treatments — might still be in the distant future for workers’ compensation.

But in an article for the American Association of Orthopaedic Surgeons, two doctors are making a case that workers’ compensation is well suited for bundled payments, particularly when the provider is an orthopedic surgeon.

“Orthopedic surgeons or groups are uniquely positioned to develop and implement bundled payments in the WC system. Not only do they know the entire continuum of care, they also understand the concepts of high- versus low-value services for patient healing and return to work,” said the article’s authors, Dr. Alexandra Page and Dr. Nicholas Colyvas. The article is in the November edition of AAOS Now.

Both authors are orthopedic surgeons based in California. Page chairs the AAOS Health Care Systems Committee and Colyvas is a member of the AAOS Practice Management Committee.

With bundled payments gaining a foothold in Medicare systems, it may be just a matter of time before the payment model reaches workers’ compensation, Page said in a telephone interview.

The question is how far providers and carriers should go in bundling workers’ compensation services.

One option would be a bundled payment for a particular surgical procedure, such as a knee replacement, along with imaging, operating room services and an anesthesiologist. At the other end of the spectrum, a provider could receive a flat fee for managing the entire scope of recovery from an injury.

“Surgeons willing to take on risk in this model must have considerable expertise in managing both the medical and the disability aspects of injuries,” the article states.

The authors said the benefits of a bundled system include a physician’s ability to treat patients without a claims adjuster as intermediary. As one example, they said, rather than a rigid prescription for 24 sessions of physical therapy, providers could help a patient start a home treatment program with support from a therapist when needed. Home treatment can be just as effective at a lower cost, Page said.

When surgeons see that surgery is inevitable for their patients, they’ll be able to bypass the insurance carrier’s requirement to try physical therapy first, Page said.

The next step is for providers to team with interested carriers to try out one or two bundles for particular surgeries, Page said. Such a trial could be carried out within existing workers’ compensation systems, she said.

Spreemo Chief Executive Officer Ron Vianu said bundled payments have potential for workers’ compensation, but bundling needs to be done in “small, digestible chunks.” Spreemo is a workers' compensation cost-containment company.

“Any solution is going to be baby steps,” said Vianu, who also pointed to outpatient surgeries, or relatively simple inpatient procedures, as a good place to start. Some providers might already be offering such procedures as bundled services, he said.

From there, Vianu said, providers can move on to more complex, higher risk bundles.

Although the bundled payment for a surgery might result in cost savings, Vianu cautioned that the quality of the treatment should not be overlooked.

And Vianu doesn’t envision workers’ compensation claims adjusters being replaced anytime soon because of the need to manage the disability portion of claims in addition to medical management.

Even those providers who might not find the added risk of bundled payments appealing should be ready for their arrival, Page said.

“It’s far better to be prepared,” she said.