Bundled Payments: Opportunities and Challenges

As use of bundled payments increases, how do health system stakeholders minimize the risk of unintended consequences and maximize chances this reimbursement model can lower costs and improve quality of care? A new study published on the Health Affairs Blog lays out core principles that are critical to steering bundled payments toward success.

In the study, “Designing Successful Bundled Payment Initiatives,” NPC Director of Research Michael Ciarametaro, MBA, and Chief Science Officer Robert W. Dubois, MD, PhD, illustrate the risks of missing the mark. They note that bundled payments can create incentives for underutilization of needed, but costly, services or avoiding caring for the sickest patients.

The paper identified three principles intended to maximize the positive aspects and minimize the negative consequences of bundled payments:

1. Bundled payments should be adequate for the care needed to achieve optimal patient outcomes. This includes setting an appropriate time frame that reflects the full cycle of care; providing sufficient reimbursement for services and technology needed to achieve the desired patient outcomes; and targeting a homogenous population.
2. Evidence-based treatment variability should be incorporated into the bundled payment, including risk adjustment as needed and allowances for patient choice.
3. Quality metrics should be used to ensure appropriate care in a bundled payment program where there may be incentives to avoid providing costly, but necessary, services. To encourage appropriate care and discourage underuse of care, quality metrics should be assigned adequate financial consequence.

To learn more about how to make bundled payments successful, view the full article on the Health Affairs website.