Bundling or Bungling, Once Again Into the Fray

Once again the innovators are moving forward with their vision of a new and improved health care system. These rapid changes are urged on without critique and are urged on by those best positioned to help - themselves. There are known consequences for now and predictable consequences later.

All providers will lose due to the adjustments to the changes and the costs of implementation. Some providers, as many as half, will get paid less. Some will be paid more, but this payment will go far away from them to the central offices. Whether this gets to the people who deliver the care is unknown. 


A reliable consequences is that the payments will be shifted to providers caring for the advantaged patients - who naturally have better outcomes. Also those already better organized and centralized may have an advantage in "coordination." What is likely is that those doing well will do well and those doing less well will do even less well.

The providers caring for patients with one or more disadvantages will be paid less. They are also the least organized. Usually these are the ones already paid less where workforce concentrations are lowest. 

And overall the government will get what it really wants - cost cutting at least in payments to the providers. There is also the potential that this will not lower overall costs. This intervention could also increase overall costs. Since it has not been adequately tested, we do not know. 

The stimulus for this post was - A Future Focus article pushes six trends to watch - The first 4 are critiqued:

Trend #1 – Incentive Payments Tied to Improving Care 

On the surface it is easy to accept the need to improve care - too easy. If we control payment we can force quality. This has been appropriately questioned since the beginning of quality improvement efforts. Also it seems that we can change physicians with payment. So far all we have done is to change where the payment goes. Incentives can make matters better or worse. Over and over the same problems have been seen across mandated performance improvement schemes.
  • Patient Factors Issues Health care outcomes are mostly about situations, behaviors, environments, and other people factors. When multiple other factors shape outcomes, it is hard to actually demonstrate differences attributable to those who deliver care. It is actually hard to match up the care to the outcome to the provider - but that has not stopped the assumptions becoming law, policy, or both.
  • Over a dozen studies indicate that performance based payment schemes discriminate against providers caring for less advantaged patients.
  • Trickle down mandates from government and other payers tend to avoid getting funding and incentives to those who deliver the care - the ones who can influence care if clinical interventions can do this at all.  
After 35 years of bundling, it should be obvious that the real motivation is about cutting costs at all costs. The cuts to costs are cutting care and are compromising those who deliver the care who are caught between patient, employer, mandate, and best care. 

Trend #2 – Measures of Care Coordination Are Established
  • Definition Dilemmas ACA and CMS have failed miserably in definitions. This makes it difficult to understand what has actually been done. Dozens of measures can be established, but what do they mean? What is the evidence basis? How can this be done efficiently and fairly? Once again care coordination is yet another clinical intervention assumed to be of value - to who?
  • Clinical Intervention Focus Fails Financially We have some indication of care coordination helping with high cost or high risk patients but studies indicate these are also costly to coordinate. This results in no gain in overall savings and added administrative influences - making health care delivery and change more difficult. 
  • Higher Standards Needed We need higher standards of evidence prior to massive implementation. Less or no experimentation is a good idea - but one avoided by designers.
  • Coordination demonstrates benefits, BUT this is often where coordination is already present. Studies based on health systems that are integrated are not relevant to 80% of US health care, especially the care for 50% left behind. One should not take the example of apples and apply it to oranges expecting some improvement in very different settings with many dimensions of differences and degrees of differences. 
To truly understand what the measures are measuring, you must understand the broad variety of US health care settings - something obviously not understood well.

Trend # 3 – Bundled Payment Shifting from Voluntary to Mandatory
  • Mandatory changes are once again premature. Decisions have been made without understanding what is likely to happen. 
  • DRG bundling has demonstrated access, cost, and quality consequences. 
  • Bundling of services is a policy change that is not better or worse. It will have winners and losers. As with the last 6 years of implementations of so-called "quality" focused initiatives, there will likely be the same consequences for the same providers and populations as in past decades. When you penalize providers where care is needed, you shape widening disparities of care. When you pay providers more where care, dollars, resources, and workforce are centralized - you will widen disparities in access, economics, and outcomes. 
Decades of side effects will be brushed under the rug and likely will not be addressed as with DRGs.

Trend# 4 – Quality Metrics For Bundled Payments Being Tested 
  • Quality metrics are widely promoted as a "solution," but as is too common there is not the evidence basis to support widespread implementation or use for payment. Not even the best (NY CABG) can discern 80% from the average - even when you can associate provider to procedure to outcome. 
  • There is a lack of evidence basis for claims of the value of quality metrics and there are huge costs. MACRA comes with a price tag just this year of $40,000 per physician. 
  • The quality metric focus is a major distraction and the link to quality is suspect at best from the studies and from what we know about other influences of outcomes - patient factors, genetics, resources, etc.

Confusion and Chaos 

There is also confusion in many areas over payment overlaps and responsibility overlaps. The payers get to decide and in recent years they have overadjusted their way - and in ways that have required costly lawsuits. Those smaller do not have this option. 

What is most clear is that this is good for cost cutting. Once again bundling appears to be the only option. And it will be implemented at all costs and consequences.


Why Implement Bundling?

This is the easiest answer of all. Bundling now as in 1983 represents the only move for widespread cost cutting. After a brief period of testing as in 1983, it will be sprung upon American health care. The winners will win more. There will be no apologies for the losers who will be in greater numbers and will be more frustrated and not know why.

A Brief Review of DRG Consequences

DRGs marginalized nurses, resulted in ratios too low and discharges too rapid with known problems for certain diagnostic codes (MI, pneumonia), accelerated primary care destruction (50,000 pc trained docs lost to hospitalists), worsened divisions between inpatient and outside, closed hundreds of small hospitals and care where needed along with the losses of health care dollars in areas most in need of such dollars. Any move to bundle something else needs to start with understanding the timing and consequences and subtle changes. Our nation needs solid support of team members to deliver care - not shifting sands of innovation promises.

No Positive Spin for the Innovator Tailspin - more claims for innovation successes are apparently attempts to hide failure
Stop the Promotion To Restore Mental Health Access - claims of mental health care reforms or improvements are a stark contrast from the reality of lowest payment, highest complexity of care, unreliable payment, and poor support other than lots of rhetoric


Primary care can be recovered and should be recovered, 
but cannot be recovered when moving the wrong directions

Robert C. Bowman, M.D.        Robert.Bowman@DignityHealth.org

The blogs represent the opinion of the blogger alone.
Copyright 2016 

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