Schaeffer Center experts weigh in on bundled-payment initiative

By Niles Wilson

A recent article in Modern Healthcare provides an update on the bundled-payment initiative led by the Centers for Medicare and Medicaid Services and relies on Schaeffer Center expertise to evaluate the initiative’s progress.


The bundled-payments initiative is a provision of the Affordable Care Act and it seeks to reform healthcare financing by grouping various treatments under a single price, as opposed to the current fee-for-service model where patients pay for each test, visit, and procedure separately. Although there is a lack of evidence that Medicare’s bundled-payment initiative will succeed, this reform boasts strong federal and private-sector support.


The experimental nature of the bundle payments initiative, which allows for staggered expansion and a broad range of options, is critical to finding an alternative to the current system. With federal health officials facing fiscal pressure to revamp the structure of healthcare financing, Schaeffer Center professor Paul Ginsburg describes experiments like the bundle payments initiative as  showing promise and provide “a type of transition to a reform.”


Director of Research Neeraj Sood echoed support for the initiative saying, “The current system has so many perverse incentives for not providing care efficiently that a lot of people think this is a step in the right direction.”