Two recent key studies on savings from Medicare’s bundled-payment program point to the negative effects of the payment model on nursing homes and post-acute care players, according to a prominent researcher.
Hospital- and physician-led bundles “are a challenge or a threat, not an opportunity, for skilled nursing facilities,” David C. Grabowski, Ph.D., professor of health care policy at the Department of Health Care Policy at Harvard Medical School, told McKnight’s Long-Term Care News.
Health Affairs this week reported on results of two bundling studies. One found that bundling for hip and knee replacements reduced spending by 1.6% from 2013 to 2016 with no overall change in quality. The other determined that lower extremity joint replacement is the only type of clinical episode in Medicare bundled-payment programs that has produced savings so far.
While the savings may be a positive sign for healthcare as a whole, the bundling model may be hurting nursing homes because hospitals, which typically control the bundles, are “pushing down” on post-acute providers, according to Grabowski. That is, hospitals are steering patients to lower-intensity settings, such as home health, and limiting utilization in post-acute settings, as in reducing length of stay. Both moves are attempts to reduce overall spending.
“Bundling may be a way to pull dollars out of the healthcare system but may not be good for long-term care or the post-acute care system in this country,” he said.
In most cases, the convener, or the entity managing the payment, is profiting, and typically the convener is the hospital. Skilled nursing facilities are “along for the ride,” he explained.