Five Lessons From 30 Years Of Bundled Payments

In recent years, large employers, physician groups, and commercial and governmental payers have been increasingly interested in the use of episode-based bundled payments as a mechanism to promote high-quality health care and smarter spending. A “bundled payment” occurs when a payer provides reimbursement to providers for a full range of care, rather than paying individual bills for parts of that care such as the surgery, physician fees, and post-acute care. The Comprehensive Care for Joint Replacement model and the recently announced acute myocardial infarction and coronary artery bypass graft bundled payment programs are examples of Medicare’s belief that alternative payment models are necessary to shift the current health care system from one that pays for volume to one that is based on value. Likewise, across the country, provider organizations and private payers are developing and implementing bundled payments for various conditions. While many health care organizations see promise in bundled payment programs, very few have been around long enough to examine the true impact of these programs on quality and costs. The UCLA kidney transplant bundle (KTB) is one of the longest-standing bundled payment programs. In the mid-1980s, UCLA began the program by negotiating a lump sum case-rate for all kidney transplantation services with Kaiser Permanente. Prior to the development of the KTB, all hospital costs, organ acquisition costs, outpatient medications, and physician s...
Source: Health Affairs Blog - Category: Health Management Authors: Tags: Costs and Spending Featured Organization and Delivery Payment Policy Alternative Payment Models Bundled Payments California Comprehensive Care for Joint Replacement model Source Type: blogs