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Commercial payers benefit from bundled pricing

May 09, 2018
Business Affairs Insurance

Patient selection
As the journey into bundled care begins with the selection of patients best suited for this type of care, it is advantageous to build a repeatable and evidence-based approach to delivering this care. More variability in the clinical and demographic attributes of the patient leads to greater potential variance in treatment. It is vital that the teams develop a consistent care path especially early into the program. This fosters the knowledge required to set utilization and quality outcomes firmly in alignment with the bundled rate. Even the slightest inconsistencies can have significant impact on the program's performance.

Healthcare performance management and analytics
With bundled payments, commercial payers, providers and healthcare delivery organizations benefit from the savings, provided the outcomes of the patient meet expectations. There are some arrangements where quality performance guarantees are included as part of the agreement. For instance, one of the most comprehensive arrangements is the inclusion of a lifetime guarantee for hip arthroplasty. As more care moves from the acute care setting into ASCs or HOPDs the price of bundles will be commoditized and attractive margins harder to maintain.

Patients may also believe that lower cost settings of care translate to the delivery of lower quality of care. This puts tremendous pressure on hospitals to begin diligent work on bundles, knowing they have a cost disadvantage compared to outpatient settings. Demonstrating high-quality care to patients regardless of setting will foster greater trust with commercial payers and employers and reduce the reluctance of patients to seek treatment in the outpatient setting.

Assessment of risk-adjusted mortality, complications and unanticipated readmissions, along with ARHQ patient safety indicators, is essential in building and maintaining a bundled program. These indicators must be risk-adjusted properly to validate performance, remediate poor outcomes, credential providers and market the program. The use of statistical process control techniques is also required to discern random versus special-cause variation in utilization or outcomes. It would be desirable to use methods published in peer-reviewed journals for integrity with the medical staff.

Shane Wolverton
The introduction of bundled pricing has already changed the face of the industry. At the very least, commercial payers and other stakeholders are considering new approaches. While CMS has backed off bundled pricing, it has left room for commercial payers to take the reins in the drive toward greater healthcare efficiency.

About the author: Shane Wolverton is senior vice president of corporate development at Quantros

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