1. Section Editor(s): Rodts, Mary Faut DNP, CNP, ONC, FAAN
  2. Editor

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The term "bundled payment" has been used for the past few years in describing how care for specific populations will be managed in the future. But what exactly is a bundled payment, and how will it affect you as an orthopaedic nurse?

Mary Faut Rodts, DNP... - Click to enlarge in new windowMary Faut Rodts, DNP, CNP, ONC, FAAN Editor

There are many names for this type of program: episode-of-care rate, case rate, and packaged rate are just some examples. This payment method provides one single payment for multiple services related to one episode of care. In orthopaedics, this would mean that the facility, surgeon, anesthesia and any other provider that sees the patient during the specified time period for the bundle would be paid out of a predetermined amount of money allocated from the entity that is managing the bundled payment program. This could be a hospital, medical provider (s), or another provider such as a skilled nursing facility or physical therapy group. Whoever has entered into the bundled payment program and has agreed to take on the responsibility of providing the oversight for the program and the distribution of the payment manages the bundle.


Sounds simple enough, right? Wrong. The complexities associated with developing the parameters for the individual bundle, including how long the episode will be and what is included in the bundle, can vary. How each bundle is structured is based on the participating entities.


Why are bundled payment programs gaining momentum? Bundled payment programs are a response to the continuing increase in health care costs in America. Traditional fee-for-service and capitated programs have made up the payment methods for health care in the United States.


The traditional fee-for-service model is when a service is provided and paid for at an agreed-upon rate. It has been implicated as the reason for the continual increase of costs due to providers ordering services that may not be necessary or that are duplicated due to lack of care coordination. With services being paid for individually, even if at a designated rate, the provider might be encouraged to order additional and potentially unnecessary services.


Capitated programs have been moderately successful and gained the reputation of rationing of health care services and avoided by those who could afford a noncapitated program. In a capitated program, a provider is paid an agreed to amount per month per patient in a designated population of patients. It is the provider's responsibility to provide care for those patients. If the patient is not seen, the provider is paid regardless. If the patient is sick and must be seen many times, the provider must provide that care as well. Additional funds are set aside and are shared with the provider if there is a surplus of money at the end of the agreed to time frame; hence, some care may not be provided. Concerns in either fee-for-service or capitated programs exist.


The goal of bundled payment arrangements is to better align financial incentives through rewarding providers for decreasing health care costs while at the same time developing efficient and effective programs that will produce excellent outcomes. One of the essential components of a bundled payment program is the meticulous coordination of care of all patients who fit the bundled payment parameters. The establishment of comprehensive clinical programs that will provide efficient and cost-effective programs with excellent patient outcomes will be required to participate in bundled programs.


The Centers for Medicare and Medicaid Services (CMS), some large employers, and health systems and providers are all in the process of developing bundled payment programs. The most talked about program nationally at this time is the CMS Bundled Payments for Care Improvement (BPCI) initiative. Providers are evaluating data to determine if participating in the BPCI program is something that makes sense. Total joint replacements will surely be an area that is amenable to a bundled payment program. Being able to structure a comprehensive, coordinated program that allows the patient to received exceptional care in an expedited manner and at the same time demonstrate excellent patient outcomes will be the challenge. Evaluating current practice patterns and looking at evidence to support care changes will be necessary. In addition, developing partnerships with other care partners such as skilled nursing facilities, home health care providers, and therapists who understand the bundled care process will be imperative.


Determining what care will fall under the bundled payment program is accomplished after careful analysis of existing data to identify where opportunities for care redesign exists. The length of the bundle could be just for the inpatient episode and include the surgeon or other inpatient providers such as anesthesia and inpatient facility charges, or could be much more complex, encompassing both the inpatient costs and up to 90 days post-discharge. Extending the bundle past the inpatient stay would include all post-acute care, including skilled nursing, home health, and physical therapy, as well as any related readmission costs. The longer the care episode, the more oversight will be required. Losing track of the patient who is part of a 90-day episode of care and having the patient experience problems resulting in related additional admissions to other facilities that would require payment under the bundled pre-agreed to price could be costly. Preventing additional care by close management to identify potential problems before they occur is ideal.


For care redesign to be successful it will require that all care providers understand the plan of care. This means that the inpatient nurse will need to understand the goals of the program and what he or she can do to help keep the patient on track to meet those goals. Keeping patients on target may not be new at all. We are used to care maps that tell us which activities a patient needs to accomplish on each postoperative day in order for the patient to be ready to be discharged. An additional important piece to the bundled care program is making sure that the patient has the necessary support after discharge to keep rehabilitation moving forward and to avoid readmissions or lengthy stays in skilled nursing facilities. Being knowledgeable and able to educate the patient at the time of discharge what would be "red flags" and require immediate contact with the physician or nurse navigator occurs today. However, in the future, this would need to be emphasized even more. All partners in the post-hospital setting must be willing to evaluate their own care management and then redesign programs to meet the benchmarks and expectations.


The bundled payment program team consists of many of the same people who provide patient care today. The big difference is a high level of communication between providers with swift and early intervention when concerns arise. This gets tricky because patients tend to seek post-hospital care from a variety of facilities or organizations. Several dashboards are available to providers through different vendors to help keep the communication lines open and up-to-date. The utilization of dashboards will be necessary so that all providers have easy access to "real-time" information about their patients. The nurse navigator in the bundled payment program becomes a key player who helps to continually monitor patients in the outpatient settings and to intervene when needed.


As an orthopaedic nurse, it is important to understand that care transformation and care management changes are inevitable. Making sure that your patients' care and progress is achieved in the established timeframe will be crucial. Taking every opportunity to understand the new care initiatives in your organization will help you be part of this new care paradigm. While the overarching goal is to reduce health care costs, it is not meant to do that at the expense of the patient. Bundled payment programs are being established to provide exceptional care that is coordinated and provides the excellent outcomes we hope to achieve.