The Orthopaedic Implant Company (OIC), based in Reno, Nevada, has announced the launch of its One Procedure, One Price™ initiative, a plan that reduces the expense of trauma procedures and creates a standardized cost of care that, according to the company, will both cut cost dramatically while also elevating each party’s experience.
OIC is offering a single, all-inclusive price for its instruments and disposables for the following procedures:
- ankle fracture repair,
- distal radius fracture repair,
- clavicle fracture repair in the emergent trauma setting.
According to the company, this innovative approach has the potential to reduce the costs that hospitals and ASCs spend on contracted pricing with other vendors by as much as 53%.
The Key: Transparent Pricing
Citing the rampant expense and lack of transparency involved in orthopedic care, Itai Nemovicher, president and CEO of OIC, told OTW, “There is a famous lack of transparency with capitated pricing. With that pricing there is always some wiggle room, a la, ‘Hey, is that bit included?’ Capitated pricing works well with total joints because there are a number of components.”
“For trauma it’s hard because you can have a plate with 10 screws or 4 screws and the associated drill bits. We asked ourselves, ‘How can we simplify the process for ASCs?’”
“If someone has an ankle fracture, they may go to the ER but have surgery in an ASC a few days later. With the current pandemic, we are seeing a shift to acute trauma being done in ASCs. The intent is to free up resources at the hospitals so they can focus on more emergent cases and COVID-19 patients. Our goal is to be able to say, ‘This ankle fracture patient is going to cost you X regardless of the surgeon preference and regardless of the type of screws used or whether they use a 4 hole or a 10-hole plate.’”
Asked how they are able to effectuate such a plan, Nemovicher told OTW, “It is essentially cost averaging. Our data tell us what items are most common in a construct for distal radius fracture. So, we take the average construct and set the price.”
Profit Not the Main Motivation
“We lose revenue on some cases and gain on others. At the end the of the day we will be okay. Our foremost priority is to reduce the cost of care.”
With One Procedure, One Price, everything needed to complete a procedure is available at one price—plates, screws, drill bits and fixation pins.
Post-COVID…Preop Budgeting
“Post-COVID-19,” says Nemovicher, “things will only accelerate in this direction. Hospitals are bleeding money and are desperate to reduce costs and overhead. ASCs are in the same boat as reimbursement declines and value-based healthcare takes hold. Going forward, the ability to budget before a case will be vital.”
Nemovicher cited a study published in the Journal of Orthopaedic Trauma that found over the course of one year, OIC implants resulted in a 53% savings compared to the average cost of competitive device offerings. And research by the University of Nevada – Reno showed a reduction in operative time compared to conventional implants, resulting from the self-contained product line. “We have been pleasantly surprised to find that not only does our system result in a cost savings but in a reduction in OR time as well—an average of 11 minutes less.”
“All of OIC’s products save money, regardless of whether they charge them as all-inclusive or per piece. OIC’s overhead costs are less, and the company is about driving down the cost, not charging overinflated prices just because the market is willing to pay them.”
“OIC is proud to be eliminating the guesswork of pricing and cost, enhancing transparency, improving margins and lowering the cost of care.”
More than ever, U.S. healthcare needs relief, and OIC is leading that charge.
