Saint Joseph Regional Medical Center joins pilot 'bundled payment' program
A 75-year-old woman falls at home and is taken by ambulance to the hospital emergency room. An emergency room doctor examines her and orders an X-ray of the leg she hurt in the accident.
A radiologist determines her leg is fractured, so the patient is scheduled to undergo orthopedic surgery. After the surgery, another doctor examines the patient before she is discharged to a rehabilitation facility for physical therapy.
"We've created a paper monster," said Al Gutierrez, president and chief executive officer of Saint Joseph Regional Hospital in Mishawaka.
But Gutierrez is confident that a pilot program under health care reform will dramatically reduce the billing and paperwork created under the current payer system and generate more collaboration among providers.
Saint Joseph Regional is among 500 health care organizations nationwide that have been selected by the Centers for Medicare and Medicaid Services to test a bundled payment model under the Affordable Care Act.
The group invited health care organizations to apply for the pilot in 2011. Applications were reviewed based on the organizations' capabilities, readiness and commitment to implement care redesign, and the hospitals were named in January.
Under the "bundled" model, all of the health care providers involved in an episode of care receive one bundled payment for the expected costs of service. The payment also includes incentives for providers to deliver services more efficiently.
The model is expected not only to provide more coordinated care -- with the hope that it will even improve health outcomes -- but also to lower Medicare costs for patients as well as the government.
"We've acknowledged that the amount of bureaucracy the government takes in managing care is quite expensive and time-consuming to all parties," Gutierrez said. "We believe this is one way of minimizing the bureaucracy related to medical care."
During the three-year program, Saint Joseph Regional will closely collaborate with a number of community health care providers and collect data for the Centers for Medicare and Medicaid Services.
The hospital is focusing on cardiology and surgery-oriented episodes of care -- from the time patients are admitted to the hospital to 90 days after they are discharged. It will include all related medical services during that time, he said.
Saint Joseph Regional will partner with general surgeons, cardiologists, anesthesiologists and other associated medical groups, Gutierrez said.
"It's not that we haven't had those conversations with physicians before, but now it involves economics," he said.
Allied Physicians of Michiana was one of the groups invited by Saint Joseph Regional to participate.
Shery Purkeypile, chief executive officer of the local multi-specialty medical group, said its leaders and doctors want to be innovative in their approach to the delivery of care and payment methodologies.
"To be out in front of this and at the table with the hospital is really important," Purkeypile said.
She looks forward to the hospital and Allied Physicians sharing records and data -- an uncommon practice today -- to analyze performance and financial accountability.
Saint Joseph Regional requested assistance from William Evans, professor of economics at the University of Notre Dame, to assist with data collection and interpretation.
"We wanted an economist to track our progress so we can demonstrate at the finish line the benefit to the country and how we delivered on it," Gutierrez said.
Michael Ferry, interim executive of business development at Saint Joseph Regional, said, "They'll either adopt this payment approach and integrate it into their methodology or go back to the drawing board."
He added there will be complete transparency with patients about the data that will be collected for the pilot. Hospital officials said there is no "opt out" since identifying data will not be used.
Purkeypile appreciates being given the opportunity to be a player in the process of reform as opposed to merely a spectator.
"If we had turned this down, we would've turned down the chance to be out in the forefront -- and that's where we want to be," Purkeypile said. "We can't bury our heads in the sand. Something is going to change."
Staff writer Heidi Prescott: