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Unraveling Payment: 556 Days to Payment
We asked Zac Watne, Utah’s payment innovation manager (he gets paid to understand the volatile world of payment reform) to give us a primer on “bundles.” Regardless of change happening in health care, thought leaders predict that payment reform, and specifically, bundled payments, are here to stay. Why? Bundles deliver care with improved outcomes at a lower price all over the United States. In this post, Zac addresses how long it takes to get paid.

What is a Bundled Payment? (Quick refresher)

A “bundle” places all of the care for a certain procedure, or series of procedures, into a single bucket. A bundle. The rationale for contracting for a bundle is threefold:

  1. Patients benefit from having a team of providers focused on improving care processes, which often result in reduced procedures, supplies, and transition time.
  2. Payers benefit from having a predetermined price they will pay for care, meaning they know the exact amount they will pay for an episode of care.
  3. Care providers benefit from knowing the predictable amount they will get paid for patient care, even if the costs associated with that care are less than the agreed-upon bundle amount.

When talking about bundles with both internal and external colleagues some of the first questions are “what bundles do we participate in?” and “how can we establish, or build, a bundle?”

This post will address “how long will it take to get paid?”

556 Days to Payment

The various timeframes associated with different bundled payment programs are often confusing. Variation abounds - when bundle(s) start/end, when payments are dispersed, how long the bundle(s) last, when financial reconciliation takes place (and what “reconciliation” means), and ultimately when the program sunsets.

The following illustrations are intended to help answer these questions. While it focuses on bundled payment programs created by the Centers for Medicare & Medicaid Services (CMS), these same concepts apply to all bundled payment programs independent of the originating organization.

What 500 days looks like

zac bundle timelines bundled payment example

Bundle timelines

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Contributor

Zac Watne

Senior Manager, Payment Strategy and Innovation, Payer Relations and Contracting, University of Utah Health

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