A new trial payment model for health care
"Colorado hospitals are diving deep into federal experiments with "bundled" payments, where the government writes one check for a coronary bypass and the hospital sorts out who gets paid what, from doctors to a home-health nurse.
These growing arrangements also put the hospitals on the hook if all the heart services, for example, add up to more than Medicare agreed to pay, and if they fail to deliver quality care.
"All of these experiments do introduce that notion of risk," said Steven Summer, president of the Colorado Hospital Association. The pilot programs are vital, he added, to moving away from the traditional one-fee-for-one-service model that fed health-care inflation.
Medicare expanded the hospitals taking on bundled payments last week, with various phases in at least three Colorado systems:
- Penrose-St. Francis in Colorado Springs, part of the Centura Health hospital network, is working with Medicare on congestive heart failure and coronary-artery bypass. Penrose and Medicare will start by comparing charges for everything related to a hospital stay for bypass - including nonacute care afterward - and compare them to a target.
In later phases, the hospital would get a bundled payment at a discounted price and then keep savings or lose money depending on outcomes and hitting patient quality goals.
- Exempla's three metro hospitals, part of the SCL Health System, have tested earlier phases of the bundles in cardiac care and now will expand into hip and knee operations and other procedures.
- University of Colorado Hospital, the anchor of a fast-growing six-hospital system, will join with its University Physicians group for bundles in providing cardiac care.
"We anticipate bundled payments for every procedure" in the future, said UCHealth president Rulon Stacey.
With U.S. health-care costs at nearly 18 percent of gross domestic product, and an aging population promising to make Medicare an even bigger portion of the federal budget, reform advocates say old payment systems are doomed. Medicare is also piloting programs where it pays doctor-and-hospital collaborations bonuses if they reduce the predicted annual cost of care for a patient's entire needs.
Many hospitals are hiring more physicians as in-house employees to better control costs and coordinate care. Hospitals will also have to do a better job negotiating prices and using supplies such as high-priced stents, and avoiding duplicating services such as MRIs, said Exempla vice president Debbie Welle-Powell.
Advocates say the systems differ from past, much-maligned models of "capitated" care, where gatekeepers had a set budget per patient and lost money if they deviated from it. Those models were based only on cost, without rigorous quality and patient- satisfaction mandates from government watchdogs, Stacey said.
Medicare will demand quality with its power of the purse, said Welle-Powell. Even if a hospital racks up $500,000 in a Medicare reward fund for savings on the bundles, "if quality metrics aren't met, there's no distribution of that reward," she said. In cardiac care, quality measures would include mortality, infection rates, readmissions and other factors." end quote
Its an interesting attempt to get spending under control - I can see the pro's and cons of it, but the kicker is that payments are tied to a satisfactory outcome, IOW if the patient isn't happy, the hospital is penalized.
Here is a link that might be useful: link