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CalPERS program helps lower costs of member hip and knee replacement surgeries
Date:6/23/2013

BALTIMOREJune 23, 2013A pilot program for CalPERS, a large public California employer aimed at reducing costs for hip and knee replacements was able to influence price drops for these procedures at facilities not originally part of the program.

This conclusion, among others, will be presented at the AcademyHealth Annual Research Meeting from 11 a.m. to 12:30 p.m. on June 23 in Baltimore. Presenter Winnie Li, senior research analyst for HealthCore Inc., the outcomes research company for WellPoint, Inc. will make a podium presentation on the findings of the reference-based purchasing design program implemented for knee and hip replacement surgeries in 2011 for CalPERS members of a WellPoint affiliated health plan.

In May, the Centers for Medicaid and Medicare Services released a database of 2011 hospital charges for Medicare services showing a wide disparity in charges for some of the same services by hospitals in the same areas. California hospital charges for total knee replacement and total hip replacement surgeries ranged from $15,000 to $110,000 without evidence of difference in outcome or quality, according to an analysis conducted by WellPoint's affiliated health plan in California in 2009.

"We were pleased to see that the program led to better quality for some measures and increased use of facilities that charge less," said Ann Boynton, deputy executive officer for Benefit Programs Policy and Planning for the California Public Employees' Retirement System, which has 356,543 PPO members in California served by WellPoint's affiliated health plan. "The outcomes of this program further support what we know to be true, that higher cost does not mean better quality. Current spending levels are not sustainable and we must continue to find ways to provide quality services at lower costs now and into the future."

As part of the intervention program, members of the California Public Employees' Retirement System were given a list of designat
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Contact: Lori McLaughlin
lori.mclaughlin2@wellpoint.com
317-407-7403
HealthCore
Source:Eurekalert

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