Healthcare Payments

How We Calculate Episodes of Care

Bundled Episodes

In most cases, CompareMaine reports the average payments for a single procedure, which may include both a professional and a facility component. However, for several procedures reported on CompareMaine, we use Optum’s Symmetry® Episode Treatment Groups® (ETG) grouper to develop episodes of care.

The ETG software is an illness classification tool that groups medical and pharmacy claims data into episodes of care – a set of services provided to treat a clinical condition or procedure (often referred to as a bundled payment). Although pharmacy claim lines are considered in the tool, only medical claims are used as part of the payment calculations on CompareMaine.

Of the 19 bundled episodes, 3 colonoscopy procedures (indicated with an asterisk* in the list below) are restricted to outpatient encounters; the remaining 16 bundled episodes may be inpatient and/or outpatient encounters.

  • Biopsy of prostate gland
  • Bladder and bladder canal (urethra) endoscopy
  • Carpal tunnel release surgery
  • Catheter insertion of stents in major coronary artery or branch, accessed through the skin
  • C-section (Cesarean delivery)
  • Colonoscopy with biopsy for noncancerous growth*
  • Colonoscopy without biopsy for encounter for preventative health services*
  • Colonoscopy with removal of polyps or growths using an endoscope*
  • Gallbladder removal
  • Hip replacement
  • Insertion of catheter for imaging of heart blood vessels or grafts
  • Knee replacement
  • Repair of groin hernia patient, age 5 years or older
  • Removal of tonsils and adenoid glands, patient younger than age 12
  • Surgical arthroscopy of knee
  • Surgical arthroscopy of shoulder
  • Upper gastrointestinal (GI) endoscopy without biopsy
  • Upper gastrointestinal (GI) endoscopy with biopsy
  • Vaginal delivery

For reference, in the list above, * indicates procedure is restricted to outpatient encounters, and indicates procedure is limited to the day of the procedure.

Many of the surgical procedures reported on CompareMaine are for a typical 60-day episode of care and includes related medical services 30 days before and 30 days after the surgery. All services related to the surgery are included, such as anesthesia, administered medications, laboratory services, and medical and surgical supplies. The services are provided by a variety of healthcare providers and healthcare settings. The estimate is attributed to the healthcare setting that was paid the most, usually the one where the surgery took place.

General surgery can be identified by many CPT Codes that have small variations from each other. To represent typical episodes of care across healthcare settings, the estimates are based on payments for a specific set of CPT and/or Revenue Codes. Each episode must have the primary CPT Code and at least one CPT or Revenue Code from each of the categories that make up a typical episode.

For example, a typical episode of care for a hip replacement includes the general surgery, anesthesia, drugs administered by injection, operating room, recovery room, medical and surgical supplies and devices, X-rays of the hip/pelvis, and therapeutic procedures. For an episode of care to be included in the estimated payment calculation, the episode must include at least one of the specific CPT and/or Revenue Codes for each of the individual components of the surgery. There are instances in which healthcare claims from standalone healthcare settings, such as ambulatory surgery centers, do not include one of the typical CPT or Revenue Codes; in which case, an exception is made.

Download the complete list of codes included in each bundled episode of care.


The ETG grouper measures the severity of each episode based on regression models that were initially developed using a nationally representative sample of 66 million episodes. These models have since been revised based on episodes based on 9.7 million members to yield a conservative set of statistically valid markers. These severity models consider complications and comorbidities associated with each ETG base, along with demographics, such as age and gender, and assign weights to each of these factors. The severity score is the sum of all the weights in the episode and a measure of expected, not actual, resource costs. This normalized measure indicates the average expected resource costs in comparisons to other episodes with the same ETG base.

In addition to severity score, each episode also has a severity level. The severity level is determined by the episode’s severity score and predetermined ranges for each level for an ETG base. Each ETG base can have up to four severity levels, with a score of one representing the lowest level of risk and four representing the highest. The severity level reflects the clinical reality of each ETG base.

Sixty-seven percent of the episodes included in the development of the payment estimates on CompareMaine 12.0 have a severity level of 1 and 11% have a severity level of 3 or above. Since the median is used to calculate the estimated average payment on CompareMaine, a severity level of one is typically used to produce the estimates.

To ensure that only relevant services are included in the creation of the episode and then reflected in the median payment estimates we use the following methodology:

  1. The claims data is processed by the ETG software and episodes are built from the CPT Codes that appear on the claim lines and are associated with the ETG base, or the condition and location on the body.
  2. Only episodes with the proper ETG base code are selected. Services received at the same time but not associated with the bundled episode, as determined by the grouper, are not grouped into the episode.
  3. Typical episodes are created based on the presence of a specific set of CPT and/or Revenue Codes that appear within the ETG-built episode for a particular bundled procedure. Typical episodes are restricted to only those claim lines associated with the CPT and/or Revenue Code determined to be a component of the bundled procedure. Download the complete list of codes included in each bundled episode of care.
  4. The episode is not included in the calculation of median payments if the grouper does not categorize the episode into an ETG category, trigger CPT codes are missing (CPT Codes on the list of codes included in the payment calculations for a bundled episode), at least one component of the typical episode is missing, or treatment indicator codes exist that are unrelated to the procedure of interest.

The median payments are calculated using MHDO’s custom logic and consider all eligible episodes, regardless of severity. However, since we use the median to calculate the average payment and the median episode tends to be the most common type, the episode typically has no complications and minimal severity.