Bound Coupled Payment Case Study

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Bundled Payments (BP):
B undled payments have increasingly become a reimbursement option that hospitals should consider to reduce the cost of care through better care coordination by providers. Hospitals and other providers must weigh the pros and cons to decide whether and how to participate in this and other alternative payment models. For example, payors that operate a BP program offer providers a single payment to cover an entire episode of care (delivery of a baby or a hip replacement, for example), rather than paying for each element of the episode individually. If the provider is able to provide the care at a lower rate than what the payor pays, the provider makes a profit. However, the provider assumes the full risk of the episode
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As providers work together under a single budget, they are more likely to be efficient and eliminate unnecessary servicesOverall, patients enjoy a decreased financial risk, better cost predictability, lower out-of-pocket expenses, and more simplified payment structures.
2) Pro – Quality of Care
Bundled payments move the emphasis away from quantity of care (volume) to quality of care (value). Instead of the provider focus being on gaining revenue from each service rendered, they can focus on the overall outcome of the procedure, and since payment is based on the effectiveness of the full episode, outcomes become the focus.
3) Pro – Coordination & Accountability Among Providers
Bundled payments cures the fragmentation issue that currently exists in the healthcare industry and improves the coordination of care between providers. It gives healthcare providers, payers and purchasers an incentive to work together to provide better quality and efficiency.
4) Pro –