In healthcare, partnerships between insurers and physicians are often announced with optimism and framed as transformative, yet many fail to achieve sustained alignment due to competing incentives.
Orthopedics, with its high-cost procedures and deeply ingrained emphasis on physician autonomy, has historically been a particularly challenging environment for payer-provider collaboration.
However, one partnership has demonstrated durability and measurable success.
In 2024, Independence Blue Cross and Philadelphia-based Rothman Orthopaedic Institute extended their value-based care agreement for another three years, building on a model initially established in 2018. Since its inception, the collaboration has delivered measurable improvements in both cost efficiency and utilization outcomes.
Rothman has reduced clinically related costs for select orthopaedic and spine procedures by more than $3,000 per case, while also decreasing hospital admissions by 38% and emergency department visits by 29%.
“The data clearly demonstrate that value-based care delivers meaningful improvements in both cost efficiency and patient outcomes,” Alex Vaccaro, MD, PhD, president of Rothman Orthopaedics said. “At Rothman Orthopaedics, we are proud to partner with Independence Blue Cross and remain committed to continually refining and expanding this model to enhance value for their members.”
A different posture toward payers
Historically, the American healthcare system has not fostered trust between physicians and insurers. In orthopedics, where reimbursement pressures and practice autonomy are closely intertwined, these relationships have often been characterized by skepticism and friction.
However, Dr. Vaccaro believes that a shift in perspective is essential for advancing sustainable healthcare delivery.
“There has historically been a perception among physicians that payers are adversarial,” he said. “However, when payers are willing to engage collaboratively, they can serve as important advocates and strategic partners in advancing high-quality, efficient patient care.”
This philosophy has shaped Rothman’s strategic approach to value-based care. Rothman was the first physician-owned orthopedic group to partner with IBX in a comprehensive episode-based payment model that places physicians in a leadership role across the full continuum of care.
Alignment, Dr. Vaccaro emphasized, is critical within well-structured networks.
“We strongly support participation in networks that recognize quality, promote accountability and provide fair and sustainable reimbursement for all stakeholders,” he said. “ Our longstanding in-network relationship with Independence Blue Cross reflects a shared commitment to the principles of value-based care.”
The site-of-care challenge
The sustainability of value-based models is closely tied to operational realities, particularly as procedures continue to migrate toward ASCs. While ASCs offer significant cost advantages, financial misalignment among stakeholders can threaten access and stability.
“One of the major challenges currently affecting ambulatory surgery centers is that, although care has appropriately shifted to lower-cost settings, inadequate reimbursement for anesthesia services has made it increasingly difficult to secure consistent anesthesia coverage.”
Long-term sustainability requires appropriate reimbursement across all clinical participants.
“For ambulatory care models to remain sustainable, reimbursement must be appropriately aligned across all participants, including the facility, the surgeon and the anesthesia providers, each of whom plays a critical role in delivering safe, high-quality care,” Dr. Vaccaro said.
Accountability across the entire episode of care
A defining feature of the Rothman–IBX model is physician accountability across the entire episode of care, not merely the surgical procedure itself. Rothman has invested in infrastructure designed to optimize patient selection, medical readiness and site-of-care decisions.
“The patient navigation infrastructure we developed is foundational to this model,” Dr. Vaccaro said. “Nurse navigators play a critical role in identifying patients early, optimizing their medical status and ensuring they receive care in the most appropriate clinical setting.”
This proactive approach ensures that modifiable risk factors are addressed prior to surgery.
“When modifiable medical risk factors are identified, we proactively optimize the patient’s condition prior to intervention, which improves clinical outcomes while also reducing unnecessary healthcare utilization and associated costs,” Dr. Vaccaro said.
Challenging longstanding assumptions
Dr. Vaccaro noted physician skepticism toward payers often stems from misconceptions rather than direct experience with collaborative models.
“There is a common belief that payers are inherently focused on minimizing reimbursement,” Dr. Vaccaro said. “We have not found this to be the case with Independence Blue Cross. We have found the insurer aligned with the goal of delivering high-quality care to their members and partnering with physicians who demonstrate excellence and efficiency.”
He further observed that alignment becomes achievable when care pathways emphasize appropriateness and efficiency.
“When care pathways are evidence-based and unnecessary or unindicated services are avoided, meaningful alignment between providers and payers becomes achievable,” he said. In my experience, payers are highly receptive to collaboration under those circumstances.”
Looking ahead
As healthcare continues to evolve, Dr. Vaccaro believes deeper structural alignment may represent the next phase of transformation.
“A significant opportunity for future alignment would be for payers to partner directly with physicians in developing efficient, high-value sites of care,” he said. “Such investment could fundamentally transform the payer-provider relationship and accelerate the transition toward truly value-driven healthcare delivery.”
In an industry where many value-based initiatives fail to achieve sustainability, the Rothman–IBX collaboration stands as a durable model. It demonstrates that when physicians and payers align around quality, efficiency and patient-centered care, meaningful and lasting improvements can be achieved.
