Dr. Tom Price Hates Bundled Payments?

Bundled payments —what’s not to like from a patient’s and taxpayer’s perspective? This fee-for-service payment alternative makes healthcare more affordable, makes Medicare more solvent, and even improves quality of care. Why then is it a well-known fact that Dr. Tom Price hates bundled payments and wants to get rid of them? The answer is simple and is easily discovered if you “follow the money”.  In the case of bundled payments, the money trail is not about who is getting more money, but rather about who is getting less money.  Bringing healthcare affordability to patients means less money for doctors and other healthcare businesses–a situation that many, including Dr. Price, will fight to stop.

Tom Price hates bundled payments and stands with businessesIn the figure above, I give Dr. Price the choice of standing with healthcare consumers (and taxpayers) or with the healthcare businesses who enrich him personally. Dr. Price has made his views about bundled payments and the group he champions well known many times in the past.  He was a practicing orthopedic surgeon for many years before becoming a politician and benefited enormously from the fee-for-service reimbursement model that operated during his medical career. As a Georgia and federal government legislator,  Dr. Price has made no secret of championing the preservation of doctors’ income while making sure government didn’t impose quality of care from them (i.e., the delivery of healthcare value).  His financial gains from medical device manufacturers after favorable legislation was introduced by him has also been reported.

In September 2016, then-representative Price termed the bundled payments “experimenting with Americans’ health” and forcing Medicare beneficiaries “into high-risk government-dictated reforms with unknown impacts.” in a letter to the leadership at the Centers for Medicare and Medicaid (CMS).  Let’s remember that this meaningless rhetoric is about a new way to pay doctors (bundled payments) and not about the health care doctors deliver!  Medical doctors routinely “experiment with Americans’ health” and “high-risk” new methods are part of the nature of the practice of medicine. Does Dr. Price want doctors to stop innovating too, or is innovation only a problem when doctors’ incomes might be impacted negatively? Dr. Price doesn’t seem to acknowledge (or care) that bundled payments have also improved the quality of care delivered.

Healthcare businesses (and individual healthcare professionals) today can be divided into two groups:

  1. those that cling to the old ways of doing business because it is comfortable and financially lucrative
  2. those that are constantly innovating for better health care delivery

Dr. Tom Price obviously falls in the first group along with healthcare professionals who share the primary goal of income and profit maximization.  Under bundled payments, orthopedic surgeons will probably see decreased income potential (their incomes exceed $500,000 per year today), especially if the care provided can be classified as “quantity over quality” under fee-for-service payments. Surgeons who provide shoddy service will no longer compensated for extra services that result under the fee-for-service model.

The bundled payments model calls for changes in healthcare business culture and practice. Patient outcomes and quality of care must become the primary focuses rather than maximization of income and profits. Bundled payments call for improved coordination of care, better communication between doctors and with patients, attention to quality of care, and delivery of cost-effective care. Providers must execute efficient care coordination strategies to ensure that patients are being treated optimally at every level of the episode to avoid expensive adverse events. All team members working under bundled payments must embrace the change for it to work effectively. Those healthcare businesses that strive for delivering the best healthcare value will succeed under the bundled payments model.

Why Do We Care that Tom Price Hates Bundled Payments?

Why do we care that Dr. Tom Price hates bundled payments? As new Secretary of Health and Human Services (HHS), Dr. Price is in a position to undo or cripple bundled payments and other Medicare payment innovations brought to patients by the CMS Innovation Center. Obamacare (PPACA) appropriated $10 billion to support the CMS Innovation Center activities until 2019.  I can only imagine the damage that Dr. Price can inflict as the new Secretary of HHS. Because Tom Price hates bundled payments, he can discourage healthcare businesses that have embraced bundled payments especially if he can halt the imposition of mandatory bundled payment programs across the country.

President Trump’s executive order freezing new regulations has pushed back the implementation of all new and expanded bundled payment models by 60 days and given Secretary Price some ammunition to do damage to mandatory bundled payments that were supposed to start in July, 2017.

Americans should not sit idly by and let payment innovations be pushed back or even allowed to disappear just because some healthcare businesses want to continue to maximize income/profits and Tom Price hates bundled payments . The United States desperately needs to reduce health spending that is more than two times that found in other industrial countries and increase its subpar quality of care .  These payment innovations are bringing down healthcare costs, improving quality of care, and making Medicare more financially secure. What more can patients and American taxpayers ask for? Perhaps the electorate needs to show Dr. Price that we are not swayed by meaningless rhetoric but by results that impact us directly.

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