The Affordable Care Act establishes a national pilot program to encourage hospitals, doctors, and other providers to work together to improve the coordination and quality of patient care. Under payment “bundling”, hospitals, doctors, and providers are paid a flat rate for an episode of care rather than the current fragmented system where each service or test or bundle of items or services are billed separately to Medicare.
For example, instead of a surgical procedure generating multiple claims from multiple providers, the entire team is compensated with a “bundled” payment that provides incentives to deliver health care services more efficiently while maintaining or improving quality of care. It aligns the incentives of those delivering care, and savings are shared between providers and the Medicare program. This will be effective no later than January 1, 2013.