Independent doctors have little control
Because hospitals receive the payments for services under bundled payment programs, they are in total control of the disbursement of these funds. Independent doctors, who choose to work with hospitals under bundled payment programs, are at the mercy of the hospital for reimbursement and have limited control on when they get paid for services rendered.
Hospitals have large influence on decisions
Under this payment program, the doctor is under the hospital’s authority. Participating doctors have minimal control over many aspects of the management of care such as: the quality of care provided by the hospital staff, hospital staffing levels, cleanliness of the facility, infection rates, purchasing, and hospital administration costs. A doctor can do everything correctly, but if adverse effects result from something under the control of the hospital, part of the risk shifts back to the physician. Doctors are paid from what is left of the reimbursement after overhead, staffing, and costs associated with the procedure. At times, this can result in significantly reduced payment for the doctors.
Reduces incentive to provide quality care
Hospitals are incentivized to reduce costs. Hospitals can take advantage of their leverage over doctors to encourage the use of cheaper drugs and supplies for the sole purpose of saving money, rather than using those that have proven positive outcomes at a more expensive cost.
Bundled payments are not the best alternative for quality care
Hospitals cannot appropriately control their inefficiencies and as such shift additional financial and medical risk to the doctor. At the end of the day, bundled payments do not equate to better care for patients or a mutually beneficial relationship between hospitals and independent doctors.
Thomas A. Thomas, CPA, PFS, CGMA. Mr. Thomas is co-founder of the Association of Independent Doctors (AID), a 501(c)(6) trade association representing independent doctors.
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