Bundled Payments: A way to improve health care quality and efficiency

If your health care plan isn’t using a bundled payment approach, you’re throwing money down the drain. With 25 percent of U.S. health care spending going to waste (Shrank, et al., 2019), it’s no wonder employers are turning to BridgeHealth for its bundled payment approach and value-based contracting to help stop the bleeding. To shine a light on how bundled payment programs increase quality while reducing cost, BridgeHealth leaders recently participated in a summit and report sponsored by Catalyst for Payment Reform (CPR), a leading national health care voice for employer-purchasers.

As thought leaders in value-based health care, BridgeHealth executives offered insight into how bundled-payment programs provide employees greater access to appropriate, high-quality care at a more affordable cost. Over the past several decades the trend in health care has been to shift cost rather than reduce cost — providers pass the cost to plan sponsors who pass the cost to members, who then are left to make hard decisions regarding care with limited tools.

Jamie Hall, BridgeHealth President

Bundled payment programs are one of the ways that employers and other health care payers are moving away from the wasteful traditional fee-for-service model to alternative payment models. BridgeHealth President Jamie Hall explained: “Value-based bundles get at the core problem, underlying cost and inefficiency, rather than literally just passing the buck.”

The default in health care “is to incrementally improve what’s fundamentally broken,” rather than get to the core issue and fix it, according to Hall. “By using bundled payments and direct contracts, we eliminate administrative waste and create a more equal, balanced and effective solution for employers, employees and their providers,” he said.

Bundled Program Reduces Waste and Increases Quality

Solving employers’ most pressing cost and quality problems, BridgeHealth’s bundled payment programs assign a price to a specific episode of care and the services surrounding it. Through a centers of excellence model of hospital and ambulatory surgery centers, the company is able to provide an affordable and all-round excellent healthcare episode for members. A Commonwealth Fund study explained why bundled payment models are effective: “The rationale is that providers and organizations are in the best position to identify ways to reduce waste and overuse, coordinate care across settings, steer patients to the most appropriate, high-quality providers, and provide needed care,” (Struijs et al., 2020, p. 1).

The CPR report also stated: “bundled payment initiatives may bring about higher-quality care than traditional fee-for-service payments. These improvements include declines in readmissions, declines in need for post-acute care, and shorter hospital stays,” which BridgeHealth statistics support. Take for example, BridgeHealth’s measurably better orthopedic surgery outcomes. “Quality does not exist everywhere, so a large part of our value proposition is helping members find and access high-quality surgeries. Today, we have contracted with high-quality orthopedic surgeons within 100 miles of 80 percent of the U.S. population, and we intend to achieve that proximity for all our categories,” Hall said.

BridgeHealth care coordinators shepherd each patient to the facility and services that provide the appropriate care for their situation before, during and after surgery. This approach cuts through inefficiencies and gives patients better outcomes. When complication rates for all BridgeHealth patients are measured against private insurance averages, the company outperforms the risk-adjusted national average. Year-after-year BridgeHealth beats the national average with an approximately two percent complication rate compared to a national rate of 10.09 percent.

Terry Fouts, MD, BridgeHealth Chief Medical Officer 

At BridgeHealth, “We look at bundles as more than just an economic relationship,” said Terry Fouts, MD, chief medical officer at BridgeHealth. “We also offer access to a surgery that results in good outcomes, fewer complications and better member satisfaction. It’s a good financial bundle accentuated through good quality providers, and the people who use us really like the service. So, a bundle is more than just a contract; it’s a new way of creating value for all of healthcare’s stakeholders,” Fouts said. BridgeHealth has a 55 percent return rate from member patients and an annual Net Promoter Score (NPS) of 90. During the COVID-19 pandemic, that score has risen to 92.

Win-Win-Win Program

A win-win-win program, the BridgeHealth approach to value-based bundles provides the employee/patient with high-touch coordinated care, the employer/payer with predictable costs and administrative savings, and the health care provider with increased volume, prepayment and no collections worries. “Value-based bundles eliminate inefficiencies associated with claims adjudication, consumer debt collection and revenue cycle management,” Hall said. “Providers get paid more efficiently, employers save enough to waive employee co-pays and deductibles, and employees get the affordable, high-quality care they need and deserve,” he said.

CPR Executive Director Suzanne Delbanco, PhD, said: “After pushing for payment reform for 10 years, approximately 60% of payments to health care providers are ‘value-oriented’ — aiming to improve the quality and affordability of care. But bundled payment has been slow to gain traction and we think it deserves more experimentation, as do many of CPR’s members.” At BridgeHealth, we couldn’t agree more.

BridgeHealth is the industry-leading provider of surgical advocacy and centers of excellence (COE) programs. For more information on BridgeHealth’s value-based bundled payment program, click here.



Catalyst for Payment Reform. (July 2020). Bundled Payment Options in the 2020 Marketplace: A Guide for Employers and Other Health Care Purchasers. 

Catalyst for Payment Reform. (July 28, 2020). Catalyst for Payment Reform Releases Bundled Payment Resources.

Shrank WH, Rogstad TL, Parekh N. (2019). Waste in the US Health Care System: Estimated Costs and Potential for Savings. JAMA.  322(15):1501–1509. doi:10.1001/jama.2019.13978

Struijs J., de Vries, EF, Baan CA, van Gils, P. F. & Rosenthal, M. B. (April 2020). Bundled-Payment Models Around the World: How They Work and What Their Impact Has Been. Commonwealth Fund.

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