The constantly rising cost of healthcare in the United States is leaving more and more people feeling helpless. There are ways to have more control, however. John’s story below is a great example.
John needed a full knee replacement. His first thought after hearing his diagnosis was that it was going to cost him a fortune. When John got home from the doctor’s office, he started researching the typical cost of knee replacement surgery online and was shocked. The average price range for the surgery alone was $40,000 to $60,000. Physical therapy and post-surgery doctor visits would cost even more, not to mention the potential cost of surgery complications. Going into surgery is stressful enough without unpredictable costs.
While trying to figure out how he was going to pay for his surgery, John remembered hearing about a bundled payment plan option in his employee benefits meeting. This plan offered a flat rate for knee replacement surgery, and included both the surgery and post-operative care.
After checking with his HR department, John was relieved—within 20 minutes of his house was a nationally recognized surgery center that was also one of the surgery centers participating in the bundled rate program offering. The flat rate of $27,500 included the surgery and all post-operative care, including physical therapy. And the best part of the bundled payment plan? While John’s maximum responsibility was the $2,500 left of his deductible, he’d also receive a $2,000 cash incentive from his employer for using the bundled payment plan, which he could use to offset his out-of-pocket expense.
John’s fears were gone once he knew exactly what the total cost of the knee surgery and all follow-up care would be. He scheduled his surgery immediately and was thankful to be able to get the care he needed to stay healthy without facing insurmountable and growing medical bills.
Why Bundled Payment Plans?
One of the key reasons that bundled payment plans are a viable and attractive option for both employers and employees is that they allow patients to receive the best care while saving on medical costs. Rather than paying for each part of a large medical procedure separately (hospital stays, operations, post-operative therapy, follow-up office visits, etc.), bundled payments provide all stages of medical care for a specific surgical procedure at a fixed price. Employees know upfront the total cost of getting all the care they will need.
Bundled payments offer the additional benefit for self-insured employers of substantially lowering out-of-pocket expenses, providing savings of up to 50% over standard contract rates. This opens the door to another potential employee benefit—employer-provided financial incentives. Since employers are saving significant amounts of money when employees utilize bundled payment plans, they can consider providing additional employee benefits, such as cash incentives, for taking advantage of such plans.
Benefits of HPS for Bundled Payments
John is just one of many employees with a Health Payment Systems (HPS) benefits plan that has been able to save money with bundled payments. In addition, John scheduled his appointment for surgery easily using the HPS concierge program. There are a variety of benefits available for employers taking advantage of HPS bundled payment plans:
- Concierge program—Makes scheduling appointments easier (optional and included in many bundles)
- SuperEOBⓇ—Exclusively offered by HPS, the SuperEOBⓇ is a single, comprehensive, easy-to-understand, monthly statement of all in-network providers’ bills and related claims so the employee only has to make one payment, regardless of the number of providers seen
- Claims process—The claims process for the employer remains the same (all bundled payment costs flow through the third-party administrator and stop-loss carrier, contributing to the deductible of the stop-loss insurance). This is critical in minimizing the annual total out-of-pocket exposure for a self-insured employer
- Ability to offer cash incentives—Employers working with HPS often use a portion of their cost-savings to offer cash incentives to employees for taking advantage of bundled payment rates.
- Best cost and care outcome—With HPS, the employer can work with their employee on the best cost and care outcome using bundled payments, which could also include waiving the deductible and coinsurance.
With HPS, it’s possible to have bundled payments that provide access to nationally recognized, high-quality providers, while also experiencing simplified employee billing and reduced healthcare costs.
To learn more about these options and services and how to help your clients take advantage of them, contact HPS today!