Bundled Payment for Care Improvement Initiative Essay

Bundled Payment Program Essay

The United States is in great need of health care reform.  I don’t know if there is a more cogent statement in all of healthcare.  Something most involved would agree on is that we cannot sustain the current fee-for-service system.  Health care costs have risen over the last decade and are predicted to rise over 6.8% in 2015 once again out pacing inflation according to Pricecooper waterhouse’s recent survey.

Offering health care to everyone is both necessary and ‘the right thing to do.’ But some of the programs embedded in the law are fraught with missteps.  Whereas, there are many, there is one in particular.  The Bundled Payments for Care Improvement Initiative .  According to the Centers of Medicare and Medicaid Services, “the bundled payment program is a program where organizations will enter into payment arrangements that include financial and performance accountability for episodes of care. These models may lead to higher quality, more coordinated care at a lower cost to Medicare.” This is fallacious, note in the quote the word “may”.  Healthcare systems were interested in this new approach until after careful vetting where they could see the lack of feasibility.

The current fee-for-service program functions as payment for services rendered by each individual entity.  Essentially, this means for a fee is charged/paid for every service:  x ray, hospital stay, surgery, office visits, (even down to the last aspirin). The bundled payment program, especially core model 4 will function as one payment for the service rendered.  That means CMS will pay one payment (historically to the hospital system) that will cover the total cost of care including up to 30 days after admission for the procedure.  As of the latest publication there are 48 eligible procedures everything from insertion of a pacemaker to a joint replacement or stent surgery.   

Let me give an example:  It would be like a mechanic is contracted for X amount of dollars to replace radiators in cars, any make or model is included.  If it costs less to replace, the mechanic would keep the difference, if it cost more, he would take the loss.  After careful research the mechanic learns that a 2012 Ford Taurus has not only the cheapest replacement parts but is the easiest to repair.  It doesn't a rocket scientist to determine that  the more appealing and most lucrative repair would be the Ford.  

The Bundled Payment program has the same potential.             

The program has been incredibly unsuccessful. There are currently only 18 sites participating in the model 4 section, which is closely linked to surgical procedures. First, just like the initial health care enrollment program, we weren’t prepared for the health systems to participate administratively.  IT programs weren’t set up properly to receive this type of claims, the different entities weren’t educated properly to understand how to bill or where to get their portion of the reimbursement.

Most importantly however, the patient care is at risk of being diminished. Let me explain, If there is a patient with illness or disease that will increase the complexity of their care, the hospitals are inclined not to accept them.  This could be anything from a co-morbidity such as obesity, diabetes or heart disease, age no matter how healthy, to a co-dependency on drugs related to the very surgery the patient needs. 

Social factors come into play also. A patient whose lifestyle, living conditions, nutrition, etc. is than optimal has more potential for an unsuccessful outcome. There is the chance that they may be limited or denied care.

There is also the risk of using inferior supplies.  If item A is great and clearly the best thing for the patient and item B is OK but costs much less, the inclination could be to use the inferior product.  This could be anything from a heart stent, to medications, to a joint prosthesis, to the type/quality of skilled nursing facility and rehab.  The proposal also includes saving money by limiting re-admissions.  This is a great goal but my concern is: will be so wrapped up in cutting the costs that patients won’t be re-admitted when needed and will care be compromised?  When focusing on the data to the degree bundled payments would, outcomes become the goal not the patient.

Do we as patients need to assume more responsibility for our health and well- being? Absolutely!   We need to be healthier and more engaged in our well-being to perpetuate better outcomes. But bundling payments and potentially limiting care to the less healthy population is not the best approach.