Traditional fee-for-service costs
Under a fee-for-service payment system, Charles’ ED visit, hospital stay and all associated lab tests and radiology exams cost a total of $11,228. This is in addition to his earlier ED visit, which cost $2,125. Charles is also seeing a primary care physician regularly. The total annual cost for his routine care is $9,000. Assuming no more complications, the total annual bill for his condition is $22,353 ($13,353 in ER visit costs + $9,000 in routine care).
PROMETHEUS Payment budget
Under the PROMETHEUS model, the treatment budget is calculated as a patient-specific “Evidence-informed Case Rate” (ECR®). An ECR includes all covered services related to the care of a single illness or condition, bundled across all providers. The ECR is also risk-adjusted to account for the severity and complexity of the patient’s condition, and includes an allowance for potentially avoidable complications (PACs). If complications occur, this portion of the budget offsets the costs of corrective treatment. But if providers can reduce or eliminate PACs, they keep the allowance as a bonus. A detailed examination of Charles’ personal history shows that, in addition to CHF, he has coronary artery disease and gastro-esophageal reflux disease. For this, he is taking antacids in addition to the standard medicines for heart failure, including diuretics, ACE-inhibitors, and anti-platelet agents. Considering the severity of Charles’ heart failure, his overall health and the medi- cines he is taking, the PROMETHEUS Payment model calculates a yearly budget of $9,800 for routine CHF care, plus an allowance for PACs of $10,300. This results in a total annual care budget of $20,750.