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Bundled payments or population health?

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Ian Morrison, Ph.D., a consultant and futurist based in Menlo Park, Calif. , writes about whether hospitals should focus on population health or bundled payments.

He notes that there’s  “growing skepticism among many respected industry experts who question whether population health, providers at risk and Accountable Care Organizations are really the right answer. They fear these models may all turn out to be a bridge too far. Instead, they argue, we should get the basics of healthcare delivery right first. Then we should use bundled payment–type models as our lead foray into financial incentives that promote improved care coordination and clinical performance delivered by focused, high-performing teams.”.”So, there is a plausible … conclusion that meaningfully incenting providers to deliver care by taking financial risk for a defined population they serve (across the continuum of care) is an impossible dream that will end in failure. Therefore, we should settle back on bundles and other less grandiose improvement initiatives instead.”On the contrary, I still believe that our best hope for sustainable health care may well come from large integrated systems of care competing on the basis of cost and quality for a defined population.”

“Overall, my forecast can be summed up as follows:

“Integrated systems with their own health plans, regional scale, direct contracting and Medicare Advantage contracts is the end game for some large players who are preparing for population health risk.”

“Many hospitals will be caught between two paradigms for the next five years (at-risk vs. fee-for-service), but the direction is toward more risk-bearing on the basis of value through a variety of constantly evolving partnerships and risk-sharing arrangements.

“Bundled payment for procedure-oriented care presents a major step toward promoting value and care coordination that does not require population health (frequency risk).

“And finally: Value-based payment trends are not enthusiastically embraced by providers. So expect public payers to make more payment innovations mandatory, not just voluntary.”



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