You are here

Bundle Payment Systems Need More Clout, Authors Argue

Longer durations, ACO integration, and non-hospital services would aid cost-effectiveness

Bundled payment systems have been with us a long while, and maybe it’s time to tweak them, according to an opinion piece in JAMA. The authors argue that bundled payments can be even more cost-effective if their durations are expanded, if some of the bundled services can be performed outside a hospital, and if they can be integrated with ACOs.

Bundled payment systems pay providers based on how well they keep costs in check as measured on benchmarks established in past performance.

The authors—Amol S. Navagthe, MD, Zirui Song, MD, and Ezekiel J. Emanuel—say that the current structure of bundled payment systems limit their effectiveness.

“They retain the fee-for-service incentive to do more, especially for conditions without well-defined criteria for intervention, and to select healthier patients, potentially increasing low-value care use that offsets efficiency savings,” they write. “Bundled payments must be restricted to conditions with a clear starting point and those in which there is only limited physician and patient discretion.”

Moving services outside of the expensive hospital setting would involve allowing primary care physicians to take on some of the financial responsibility. The authors cite Medicare’s oncology bundle care model that lets outpatient practices share in the risk.

“Similarly, allowing ambulatory surgery centers or orthopedic practices to serve as the risk-bearing entity for hip replacements would incentivize a shift in surgical procedures out of the hospital, potentially generating substantial cost savings,” the authors write.

One of the biggest problems with the current structure is that the “bundles” for the most part cover services up to 90 days after hospital discharge. Extending that to one year, the authors argue, would encompass more longitudinal care. Maternity bundled care, for instance, could include prenatal care, delivery, and subsequent neonatal care.

“For chronic diseases such as atrial fibrillation, the bundle may include physician visits, laboratory measurements for anticoagulation such as the international normalized ratio, diagnostic services such as electrocardiograms, medications, therapeutic procedures such as cardioversion and ablation, and associated hospitalizations.”

Bundled payments could work with ACOs if every provider involved has the same information on a patient. “The simplest approach is to count episodes for patients in ACOs in the bundle program by including the actual episode costs for assigned beneficiaries within the global costs of ACOs,” the authors write. Bundled payment care could be evaluated separately from the calculations of total cost at ACOs.

“This structure would not allow the ACO program to offset the incentive to do more within the bundled payment and would potentially reduce savings for ACOs by allowing clinicians to cherry-pick more profitable cases,” the authors write.

Source: Managed Healthcare Executive; June 28, 2017.

Recent Headlines

Study finds fewer than half of trials followed the law
WHO to meet tomorrow to decide on international public heath emergency declaration
Study of posted prices finds wild variations and missing data
Potential contamination could lead to supply chain disruptions
Despite older, sicker patients, mortality rate fell by a third in 10 years
Declining lung cancer mortality helped fuel the progress
Kinase inhibitor targets tumors with a PDGFRA exon 18 mutation
Delayed surgery reduces benefits; premature surgery raises risks
Mortality nearly doubled when patients stopped using their drugs