Bundled Payments

New Bundled Payments and Facilities Added to Save Members Money

In the past, members paid multiple bills for anesthesia, facility fees, and physician charges for certain elective outpatient procedures. The South Dakota State Employee Health Plan, working in partnership with providers, now offers bundled payments for certain outpatient procedures.

What is a Bundled Payment?

A bundled payment is a payment structure in which facilities treating the same or related conditions charge one price for a single occurrence of care. A single occurrence of care includes most charges and services including anesthesia, facility fees, physician charges, surgery charges, and follow up care within a limited time.

For example, instead of a surgical procedure generating multiple claims and fees from several providers, the entire medical team and facility receives compensation with a single bundled payment.

Previously, members paid an average of $1,400 - $1,600 in copayments and coinsurance fees for anesthesia, facility fees, and physician services associated with elective surgery. With bundled payments, members enrolled in the $300 Deductible/Copay and $1,000 Deductible Plans pay a copayment of $500 to cover all of those services and the copayment applies to the out-of-pocket maximum.

Bundled payments encourage doctors, hospitals, and other health care providers to work together to better coordinate care for patients both when they are in the outpatient facility and after they go home.

What are the advantages of a Bundled Payment?

Advantages of bundled payments include:

  • Lowering cost for Members
  • Assigning one copayment per occurrence of care
  • Eliminating multiple claims / Explanation Of Benefits (EOB)
  • Creating financially beneficial locations and providers for elective outpatient procedures
  • Maintaining a high level of care quality

Will members on the $300 Deductible/Copay and $1,000 Deductible Plans really pay only $500?

Yes. As a member, you can expect the following:

  • Deferral of Deductible for $300 Deductible and $1,000 Deductible Plans for bundled payment procedure
  • $500 fee
  • Deferral of coinsurance for bundled payment procedure (see chart below)


Bundled Payments $300 Deductible/Copay Plan $1,000 Deductible Plan
Deductible Deferred Deferred
Copayment $500


Coinsurance Deferred Deferred

Members must verify CPT codes with providers or contact Health Management Partners (HMP) for assistance at 877.573.7347, option 5. Watch for more outpatient procedures in the future.

What does Deferral of Deductible and Coinsurance mean?

Deferral of deductibles and coinsurance means that after the bundled payment procedure is completed and you pay the $500 fee, you will need to continue your deductible and coinsurance amounts for other medical care not related to the bundled payment procedure. The $500 fee for the bundled payment procedure will apply to your out-of-pocket maximum for the year.

Could there be additional charges that the $500 Copayment does not cover?
In most cases, patients in good health prior to surgery will not have any additional charges. Visit with your provider prior to the surgery to determine if you are in good health and able to receive the bundled payment procedure. Call HMP at 877.573.7347, option 5 for more information.

Bundled Payment Procedures


CPT Codes

Effective Date

Back Surgery

63030, 63042, and 63047


Breast Excision/Reconstruction

19101, 19120, 19125, 19301, 19302, 19303, 19305, 19318, 19350, 19370, 19371


Arthroscopy of Shoulder

29806, 29807, 29822, 29824, 29826, 29827


Arthroscopy of Knee

29870, 29874, 29875, 29876, 29877, 29879, 29880, 29881, 29882, 29883, 29884, 29885, 29886, 29887, 29888, 29889


Nasal/Sinus Endoscopy

31254, 31255, 31256,31267, 31276, 31287, 31288



31622, 31623, 31624, 31625, 31628, 31629, 3635, 31643



42820, 42821, 42825, 42826


Upper GI

43235, 43239, 43242, 43244, 43245, 43246, 43247, 43248, 43249, 43250, 43251, 43258, 43259


(medically necessary)

45378, 45380, 45382, 45383, 45384



47579, 47562,47563


Hernia Repair

49505, 49650






64718, 64719, 64721









58550, 58660, 58661, 58662


What do I need to know about CPT Codes?

Elective procedures performed at facilities are billed by numbers, referred to as CPT codes. The CPT codes on a bill tell DAKOTACARE how much to pay. If the code for the service you need is not listed above, it will not be paid as a bundled payment. It is important for you, the member and consumer, to confirm that the procedure you are receiving is included in one of the CPT codes listed above.

If I need help understanding whether my procedure and provider is covered under the bundled agreements, who can I talk to?
Right now, call Health Management Partners (HMP), our managed care partner, to help you determine if your medical procedure falls into the bundled procedures. You may contact them at 877.573.7347, option 5. In the near future, your benefits program will be offering enhanced customer service to assist you in answering your questions.

How do I find a facility I can use for these procedures?
Contact Desirae at 605.773.3148 to find a facility that offers members a unique pricing option that provides you, the consumer, a choice to reduce your out-of-pocket expenses.

Will there be other types of procedures included in the future?
Yes. We will notify members of additional bundled payment procedures using the benefits newsletter. Members are consumers of all types of services, including medical care. If you are cost conscious, you need to know there are alternatives available. You have the choice to receive a procedure at a facility offering bundled payments and save money.