Why hospitals should include doctors in bundled payments

Although the idea of including doctors in hospitals' bundled care payments has long been considered a detriment to physician autonomy, the move could significantly improve savings and care quality, argues an opinion piece published by the Journal of the American Medical Association.

The idea has been floated before, write Ateev Mehotra, M.D., of Harvard Medical School and Peter Hussey, Ph.D., of the RAND Corporation, with Medicare successfully experimenting with a physician-inclusive model in three pilot studies over the last two decades. In a healthcare landscape where the relationship between hospitals and physicians is in a state of flux, it is time to revisit the idea, they write.

Mehotra and Hussey argue that the inclusion would strengthen physician engagement by ensuring doctors and the hospitals that employ them operate under the same incentives, rather than being paid separately. The results of the pilot studies support the idea that payment integration improves clinical integration between the two. Integration could also refine delivery mechanisms, they write. For example, telemedicine or e-referrals could greatly simplify many specialty consultation issues, but current payment policies require that doctors personally examine and interview patients.

Eliminating one of the two payment systems would also reduce administrative costs, which make up a quarter of all hospital spending and simplify both the billing process and the documentation required of physicians, they write.

There would be numerous obstacles to implementing such a system, the authors caution; for example, physicians' willingness to depend on hospitals for reimbursement will likely come down to individual hospital-physician relationships, as well as varying by specialty. Moreover, hospitals vary in number of doctor visits per inpatient stay, which means that organizations that financially rely on more physician encounters, such as teaching hospitals, could find bundled payments would have a negative impact on their finances. 

The overall benefits of the bundled payment programs remain an unsettled question; a March report found little difference in care quality, although they tend to be more successful for private payers with higher case volumes.

To learn more:
- here's the opinion piece