Until then, both commercial and CMS bundled payments will rely on retrospective payments. Prospective payments may become more common as claims processing and coding systems become more nuanced, and as risk scoring for patient populations become more predictive. In short, patients vary MUCH more than cars (or anything else we purchase), which is why the health care payment system is dissimilar from most every other service or commodity we buy.įrom a financial standpoint retrospective payments for bundles are easier to understand, administer, and execute, which is why they comprise the majority of bundled payment financing arrangements. Prospective payments are completely dependent on the demographics and risk profiles of prior cases – meaning actual patient complexities and comorbidities are not captured when determining the negotiated bundled rate. if the costs for a patient surpass a certain threshold (described above). These are timeframes where the total costs for patient care are assessed over several months while the care is still being paid for via the patient, insurance (private or government), employer, or a combination of the three. Further, prospective payment models often include clauses that call for a “reconciliation” process* The majority of bundles have "reconciliation periods" (click here to read prior article). Most financial systems are simply not designed to accept a set amount for patients that could have many different diagnosis and treatment codes associated with their particular path. ![]() Model 4 involves a prospective bundled payment arrangement, where a lump sum payment is made to a provider for the entire episode of care. ![]() Medical Dictionary for the Health Professions and. Models 2 and 3 involve a retrospective bundled payment arrangement where actual expenditures are reconciled against a target price for an episode of care. ![]() While the prospective payment option sounds appealing and simple to administer, the financial mechanisms required for these types of payments defy the current systems of payment. A payment made after an action has happened or therapy provided such as in fee-for-service reimbursement.
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