APRIL 10, 2012

Welcome to the Bundled Payment Update eNewsletter
This issue is sponsored by Bundled Payment Summit

Aetna and Hoag Orthopedic Institute Collaborate with McKesson on Innovative Automated Bundled Payment Initiative
Software companies are beginning to provide innovative packages to payers and providers to facilitate bundling, as seen in this Wall Street Journal story. (Market Watch, April 9, 2012)

Integrating Care through Bundled Payments -- Lessons from the Netherlands
The Dutch are experimenting with bundled payments with organizations similar to ACOs called "care groups," as noted in this New England Journal of Medicine perspective piece. Care groups are now addressing quality and cost issues through bundling in diabetes, chronic obstructive pulmonary disease (COPD), and vascular risk management. (NEJM 364;11 nejm.990 org March 17, 2011)

"Evaluating and Negotiating Emerging Payment Options"
The American Medical Association has prepared an excellent PDF "how to" manual for members on participating in a variety of evolving payment models including bundling, pay for performance, shared savings, etc. Also included are helpful sections on needed capabilities and considerations such as stop loss, the use of actuaries and other background information. (AMA, 2012)

Myth Busters #19: Are Bundled Payments the Answer?
Greg Scandlen argues that bundled payments will not save money because fee for service is not the problem; rather it is third party payment. He compares healthcare with higher education - which bundles services in tuition and charges the same for the smart ones as for the dumb ones. Yet bundling has not curbed education costs; in fact higher education costs have risen twice as fast as those of healthcare since 2000. (John Goodman's Health Policy Blog, April 2, 2012)

9 Ways Better Data Can Drive Hospital Bundled Payment Initiatives
A good overview of the bundling process is found in this article including concise recommendations on how to prepare. (Becker's Hospital Review, April 4, 2012)

Dual-Eligibles Bring Opportunities to Long-Term Care Operators
Because CMS has laid plans for as many two million dual-eligibles to enroll in integrated delivery systems, long-term care will become an increasing focus for integration. (McKnight's, March 29, 2012)

Health Reform 2: Why American Health Will Never be the Same
This Washington Post blog post, which provides an interesting discussion on healthcare reform and its current prospects, also reports on the success of San Antonio's 5-hospital Baptist Health System's success with bundling and related payment changes. (Washington Post WONKBLOG, March 24, 2012)

Top 2012 Trends for Hospitals and Health Systems

Click image above for full report

Source: Healthcare Trends in 2012: A Strategic Industry Forecast, November 2, 2011

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Is Bundled Payment Enough: Or Is the Pressure Too Strong?

Stuart H. Altman, PhD
Sol C. Chaiken Professor of National Health Policy, Brandeis University, Waltham, MA