Medtronic Chairman and CEO Joins HHS Secretary to Discuss Future of Delivery System Reform
JACKSONVILLE, FL - Medtronic Chairman and CEO Omar Ishrak joined U.S. Health and Human Services Secretary Sylvia M. Burwell at an event in Florida to discuss ongoing work to improve the healthcare system and deliver better care at a lower cost. At the roundtable held on July 26, doctors, industry CEOs, and patients voiced support for expanding bundled payment models.
“With the Affordable Care Act, we not only took important steps forward in helping more Americans than ever afford quality health insurance, but also gained new tools to build a healthcare system that works better for everyone,” said Secretary Burwell. “Bundled payments are helping us transform our healthcare system by creating innovative care delivery models that support hospitals, doctors, and other providers in their efforts to deliver better care at a lower cost.”
A bundled payment is a single payment for services required to treat a patient with a specific medical condition or disease over a defined timeframe.
Bundled payment typically covers the range of services needed in a designated episode of care, including physician services, inpatient acute care, outpatient hospital services, readmissions, and post-acute care.
If a patient has cardiac bypass surgery, for example, rather than making one payment to the hospital, a second payment to the surgeon, and a third payment to the hospital for a readmission, the payer would combine these payments for the specific episode of care (i.e., cardiac bypass surgery) and assign the bundled payment to one party to manage. The bundled payment gives the hospital and the physician an aligned incentive to reduce the readmission.
Bundled payments create incentives for hospitals and providers to deliver better care at lower cost because they reward health systems and providers that work together to deliver patient-centered care.
Industry leaders who participated in the roundtable event highlighted the improved quality and cost effectiveness that delivery reforms like bundled payments have had on their businesses.
“Moving to a value-based healthcare system will take novel, innovative approaches and new forms of partnership between different stakeholders in healthcare,” said Medtronic Chairman and CEO Omar Ishrak. “Bundled payment models, like those being championed by HHS, offer a concrete way to begin moving to value-based care. We feel that the appropriate application of technology can not only address inefficiencies in healthcare delivery, but potentially drive inflection points in value creation. We are pleased to see HHS’ leadership in this area, and we will continue to do our part to make efforts such as these successful.”
The event took place at Brooks Rehabilitation Hospital in Florida, an early participant in the Centers for Medicare & Medicaid Services (CMS) Bundled Payments for Care Improvement initiative, enabled by the Affordable Care Act.