{"id":11823,"date":"2015-10-28T17:06:29","date_gmt":"2015-10-28T21:06:29","guid":{"rendered":"http:\/\/www.poweryourpractice.com\/?p=11823"},"modified":"2025-10-24T12:38:10","modified_gmt":"2025-10-24T12:38:10","slug":"dont-get-tripped-up-by-bundled-codes","status":"publish","type":"post","link":"https:\/\/carecloud.com\/continuum\/dont-get-tripped-up-by-bundled-codes\/","title":{"rendered":"Don\u2019t Get Tripped Up by Bundled Codes"},"content":{"rendered":"

Madelyn Young contributed to this post<\/i><\/p>\n

For a long time in medicine, a \u2018bundle\u2019 referred to a bunch of parallel fibers in the body, like a muscle bundle or vascular bundle. Now that we\u2019re moving toward value-based care, however, a much more common term is emerging: \u201cbundled codes\u201d<\/p>\n

To set up the right incentives for value-based healthcare, both Japan and the United States have been gradually moving toward more bundled payments<\/a> for medical care, according to the Medical Group Management Association (MGMA) June 2015 article \u201cTaking the leap to make bundled payments work.\u201d<\/p>\n

Whether you agree with this or not, CMS states \u201cresearch has shown that bundled payments can align incentives for providers<\/a> \u2013 hospitals, post-acute care providers, physicians, and other practitioners \u2013 allowing them to work closely together across all specialties and settings.\u201d<\/p>\n

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Bundled coding essentially pays one amount. Multiple providers who treat the same patient at the same time share this payment. Historically, providers billed separately for their services. The Centers for Medicaid & Medicare Services believes this can \u201cresult in fragmented care with minimal coordination across providers and health care settings. It also rewards the quantity of services offered by providers rather than the quality of care furnished.\u201d<\/p>\n

A Move Toward More Mandatory Bundling?<\/h2>\n

In July 2015, CMS announced proposed mandatory bundling for hip and knee replacement surgery in 75 geographic areas. This represents the first time Medicare proposes making bundled payments mandatory for doctors, hospitals and other providers. Rob Lazerow, the Advisory Board’s expert on payment reform, told The Daily Briefing’s Dan Diamond<\/p>\n

\u201cIntroducing a mandatory program is a substantial change for providers, who generally assumed bundles would be optional for the foreseeable future,\u201d Mr. Lazerow continues. He adds that CMS is taking a minimally disruptive approach by creating a virtual bundle. \u201cAs a result, no provider has to collect the payment, or play the role of the \u2018banker\u2019 as I like to call it. Instead, everyone will continue to be paid by CMS directly. That reduces the administrative burden involved.\u201d<\/p>\n

Why start with joint replacement surgeries? In a news release, CMS explains that hip and knee replacements are some of the most common surgeries among Medicare beneficiaries. In 2013, there were more than 400,000 inpatient primary procedures, costing more than $7 billion for hospitalization alone.<\/p>\n

Virtual Reality<\/h2>\n

The AMA also offers advice for navigating the world of bundled payments. They explain the difference between \u201cvirtual bundling,\u201d where one organization like an ACO pays each provider separately, and traditional bundling where each provider bills for their pre-determined part of the single payment. The AMA recommends knowing in advance whether or not the payer will pay a single entity or use virtual bundling.<\/strong><\/p>\n

Other AMA states some unique issues can arise with bundling codes. Considerations include:<\/p>\n