The escalating cost of health care represents one of the greatest domestic
challenges for the United States. While the growth in health care costs has
slowed in the past year, the rate of rise remains well above inflation. Currently,
Medicare and Medicaid costs exceed 25 percent of the federal budget and
health care costs in aggregate are approaching 20 percent of the GDP. As
pointed out in a July 2013 Journal of the American Medical Association
editorial, the magnitude of these costs—nearly twice other nations with more
comprehensive coverage—decreases the take-home pay of middle income
wage earners as revenue from increased productivity covers the higher costs;
diverts states’ revenues from schools, infrastructure, and other programs;
and is the major driver of the escalating federal deficit.
Alternatives to the organization of health care payments and even systems of
delivery are increasingly employed to attempt to address the cost of health care.
While CMS is initiating pilot projects, many major insurance companies already
are offering a range of payment structures. The possible arrangements include
the patient centered medical home, bundled payments, ACOs, to full at-risk
contracts for a population of patients. The CMS Center for Medicare
and Medicaid Innovation has three expectations of any arrangement:
improved quality, improved outcomes, and lower costs.
This document reviews the considerations in establishing a bundled payment
program for stroke. As with any alternative payment model, a great deal of
thought and planning is necessary prior to implementation. The concept is
that the bundled payment will cover the care through the full episode. It is
critical to define that episode.
The escalating cost of health care represents one of the greatest domestic
challenges for the United States. While the growth in health care costs has
slowed in the past year, the rate of rise remains well above inflation. Currently,
Medicare and Medicaid costs exceed 25 percent of the federal budget and
health care costs in aggregate are approaching 20 percent of the GDP. As
pointed out in a July 2013 Journal of the American Medical Association
editorial, the magnitude of these costs—nearly twice other nations with more
comprehensive coverage—decreases the take-home pay of middle income
wage earners as revenue from increased productivity covers the higher costs;
diverts states’ revenues from schools, infrastructure, and other programs;
and is the major driver of the escalating federal deficit.
Alternatives to the organization of health care payments and even systems of
delivery are increasingly employed to attempt to address the cost of health care.
While CMS is initiating pilot projects, many major insurance companies already
are offering a range of payment structures. The possible arrangements include
the patient centered medical home, bundled payments, ACOs, to full at-risk
contracts for a population of patients. The CMS Center for Medicare
and Medicaid Innovation has three expectations of any arrangement:
improved quality, improved outcomes, and lower costs.
This document reviews the considerations in establishing a bundled payment
program for stroke. As with any alternative payment model, a great deal of
thought and planning is necessary prior to implementation. The concept is
that the bundled payment will cover the care through the full episode. It is
critical to define that episode.
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