"Lowering the appropriate level of care to really what it should be rather than the easiest place to get into has driven most of the savings, but still a quarter of savings is coming from operational efficiency because everyone's so engaged and aligned," says Whittington.
Part of that comes from achievements in the supply chain, especially with implants. With a standardized order set, Baptist now pays on average between 60% and 67% of what it was paying six years ago. That one standard order set for joint replacement has greater than 95% adherence.
But gainsharing has a notorious reputation among physicians for fading over time, which makes sense. Efficiencies and better standards of care can reduce cost only so far.
"That is the major concern of everyone involved, that gainsharing fades," says Whittington. "Physicians tell us this is great, and we can do this for a while, but CMS will see how efficient we've been and reset at a lower rate. It is a concern. Medicare probably has that in the back of their head."
Whittington and Reeve advise others in their position to carefully oversee any transition to a bundling program, and that leadership has to come from the C-suite. It can't be delegated because it is such a radical change.
Then, "understand your data and where your patients are going after they leave the hospital. Almost half the cost occurs after they leave, so there's a lot of work there that can be done," says Whittington. "And you need a physician champion; they might start skeptical, but get someone that others will listen to. Without a doubt we couldn't do this without them."
Commercial payer experience
Commercial bundles can also be a good place to get some experience, and the agreements are certainly potentially more flexible than CMS' bundling decrees.
It's hard to believe it's been going on so long, but Trisha Frick-Hoff, MS, RN, a nurse by training and nurse manager by background, has been overseeing the Johns Hopkins HealthCare LLC commercial bundled payment program for the past 15 years, although the volume and interest hasn't always been as hot as it is now.
Philip Betbeze is the senior leadership editor at HealthLeaders.