The idea of paying a single bundled reimbursement around episodes of care, such as knee replacements, is attracting attention in markets across the country. But, like any advancement, its important to consider the unintended consequences. Some experts now are raising concern that bundled payments might stifle innovation.
In the quest to standardize care for selected episodes subject to a bundled payment, providers and payers may neglect emerging technology or medicinal advancements that, at least initially, might increase costs, argue researchers at the nonprofit Network for Excellence in Health Innovation. Moreover, the quality measures currently in use are not robust enough to capture a patient’s health status, NEHI’s paper suggests.
Though the use of bundled payment for reimbursement among commercial insurers is estimated to be less than 1 percent of payments, the Centers for Medicare & Medicaid Services has seen some financial success with the model and is encouraging expansion of its use.
NEHI, which published a brief and sponsored an event on the subject, makes the case for consciously creating flexibility for innovation when creating protocols and practice standards for a bundled payment program. “There definitely is some concern out there that needs to be addressed,” says NEHI’s Rebecca Paradis, co-author of the brief and a senior health policy associate.
Paradis says NEHI is not trying to prevent or limit the growth of bundled payment programs, but the organization’s officials would like to see the expansion of the reimbursement model done in a thoughtful manner. “Any kind of bundled payment arrangement has to, from the outset, make room for innovation,” Paradis says.
Mark Smith, director of the MedStar Institute for Innovation, says NEHI has a point regarding health care’s inclination to stick to a certain care approach once it’s been implemented. Standards of practice change over time, but health care providers don’t always change as quickly. The institute is part of MedStar Health, a 10-hospital system in Maryland and Washington, D.C.
In a bundled payment world, taking on a higher-cost yet more effective treatment or drug is less likely to happen, Smith says. Care protocols can raise the floor in terms of quality of care, but also can lower the ceiling, he says