Kaiser Health News’ Phil Galewitz looks at bundling hospital payments, a possible solution to the confusion and cost of separate billing. Under these programs (now in Tulsa and San Antonio, and coming soon to Denver, Albuquerque and Oklahoma City), “Medicare makes a single reimbursement for all the hospital and doctor care for heart and joint procedures, rather than making separate payments to the facility and physicians.”
In theory, the benefits are clear:
Bundling payments moves medical charges away from the traditional fee-for-service system that pays providers separately for individual services — an arrangement critics of the current system say leads to doctors and hospitals delivering more care, but not better care.
It looks like the program’s making a difference. A hospital executive admits the bundled payments make hospitals more reluctant to consult specialists (because the payment from Medicare remains the same and doesn’t rise to meet the cost of a specialist) but says the increased attention to quality brought by the bundling has improved patient care.
Similarly, Galewitz writes that a similar program in the mid 1990s “saved $42.3 million over three years, with costs decreasing from 10% to 37% at the four hospitals participating in the test.”
