Bundled payments are coming.  Are there any readers who have not heard?  But do we know what “bundled payments” might mean for anesthesiologists and pain physicians? Although there are certainly anesthesiologists participating in bundled payment systems—common examples include global surgical packages or OB packages—no one has written a field guide for the specialty.  The chapter on bundled payment for post-acute care strategies in MedPAC’s June 2013 Report to Congress provides a thorough and up-to-date review of general bundled-payment design issues.  More important, Congress will consider MedPAC’s recommendations in any new legislation on the topic, much as it did when it wrote and adopted the Patient Protection and Affordable Care Act of 2010, including a provision requiring Medicare to test a bundled payment approach. In a bundled payment methodology, a single, bundled payment covers all of the services delivered by two or more providers during a single episode of care or over...

In 2011, 12.3 percent of Medicare hospital admissions were followed by a potentially preventable readmission, according to the Medicare Payment Advisory Commission (MedPAC), which has just released its latest Report to Congress on Medicare and the Health Care Delivery System. To be clear from the outset, not all potentially preventable admissions can be avoided. A classification system developed by 3M Health Information Systems and discussed in the MedPAC report defines a potentially preventable readmission “as a readmission that is clinically related to the initial hospitalization in that the underlying reason for the readmission may be plausibly related to the care during and immediately after a prior hospital stay.  A clinically related readmission may have resulted from a process of care or treatment during the prior admission or from a lack of postdischarge follow-up rather than from unrelated events that occurred after the prior admission.” Preventing readmissions typically depends more on primary...

Some payers are sowing confusion regarding whether nerve blocks placed for the management of postoperative pain are separately payable. ABC’s Alert dated April 8, 2013 noted that Noridian LLC, the Medicare Part B (physician services) contractor for ten states in the Western U.S. had published a proposed policy that would prevent payment for peripheral nerve blocks placed preoperatively to reduce postoperative pain. Specifically, the draft policy (Local Coverage Determination, or LCD) entitled Nerve Blockade: Somatic, Selective Nerve Root, and Epidural stated that: “Providers should not expect separate payment for the establishment of epidural or other pain blocks unless the block is placed following discharge from PACU due to documented inadequate pain control.” The proposed new rule received considerable attention, as it would have reversed the longstanding principle that the purpose of a nerve block placed to manage surgical pain, and not its timing, determines whether the block is separately payable from...

A "bundled" payment covers a defined package of services delivered by two or more providers during a single episode of care or over a specific period of time. Nine out of nineteen provider-payer pairs studied by Bailit Health Purchasing, LLC have fully operationalized at least one bundled payment.  Two more pairs are conducting observational pilots and three others have embarked on developing a bundled payment program.  The Healthcare Incentives Improvement Institute (HCI3) asked Bailit to examine the status of bundled payments in 2011, and then to update the results this year.  Overall, as reported in HCI3’s Issue Brief “Bundled Payments One Year Later: An Update on the Status of Implementations and Operational Findings—May 30, 2013,”  payer and provider pairs have successfully brought bundled payments online and are working toward making them a permanent health care financing change, although challenges remain.  The Issue Brief illustrates both the achievements and the challenges through...

Recently I had the pleasure of speaking with anesthesia residents and faculty at a well-known progressive academic anesthesiology department. Opportunities like this are among the high points of my professional life because I invariably know more when I leave these presentations than when I arrive. This time was no different. My recent professional focus has been on working with hospitals and health systems to identify workflow enhancements and quality improvement initiatives to streamline care delivery and deliver greater total value. On a more theoretical level, I have been identifying and developing novel ways to produce comparable or better perioperative medical care in terms of price, quality, and service by using nontraditional processes or clinicians in nontraditional ways. With few exceptions, however, these latter efforts fall mainly into what one would call product development—showing promise but not yet ready for prime time. The topic, then, for this visit was the role of...