Taiwan serves as litmus test for bundled payments in US

The success of bundled breast payments in Taiwan may be generalizable to the U.S., according to a collaborative study published in the Journal of American Medical Association by a group of Taiwanese and U.S. researchers.

The cost of healthcare in the U.S. will match the mean U.S. household income in less than 10 years, if current trends hold firm. Reforms like the Affordable Care Act (ACA) attempted to address some of the underlying problems, but the sharp cost increase for 2017 creates a bleak outlook for Marketplace customers.

The Medicare Access and CHIP Reauthorization Act (MACRA) represents a different way to attack cost issues, this time from the care providers’ end. A central tenet of the legislation is the incentivizing of alternate payment models, including merit-based and bundled payments. CMS want 30 percent of Medicare payments tied to quality measures or alternate payment models by the end of 2016, but the study authors weren’t satisfied with the current research on bundled payments over a full cycle of cancer care.

“Use of clinical pathways and bundled payment has been suggested as a strategy to reward physicians for equivalent or improved outcomes while reducing total costs of cancer care,” the authors wrote. “However, data are scant on bundled payment for oncologic conditions in the era of affordable care.”

They looked to a bundled payment pilot program initiated in 2001 by Taiwan’s National Health Insurance Administration (NHIA), investigating the outcomes and expenses of the bundled system compared to Taiwan’s typical fee-for-service (FFC) program. The NHIA reimbursed institutions after one and five years of patient care and offered bonus payments if the year-end rates of overall and event-free survival met the standards set by the NHIA.

Researchers included more than 26,000 patients in a sample to measure the success of the program, measuring survival rates, medical payments and adherence to quality indicators.

The bundled program provided distinct improvements over the FFS program, according to the authors.

“The bundled-payment system is known to encourage physicians of different specialties and nurses to function as a team to improve the quality of breast cancer care and to reduce use of procedures of little or no value,” they wrote.

A total of 35 percent of patients enrolled in the bundled payment program achieved or surpassed bonus payment quality measures, compared to only 27 percent in the FFS program. In addition, patients in the bundled program had significantly improved five-year survival, especially for stage I, stage II, or stage III breast cancer. The largest quality improvements in the care process were during preoperative confirmation and radiotherapy, when compared to the FFS group.

Researchers found financial advantages as well. While five-year cumulative payments for the bundled group were initially higher, the FFS group’s payments steadily increased while the bundled group’s remained the same.

The researchers were confident that bundled payments offer quality and financial advantages over FFS payments, and will be a valuable tool in reducing the financial burden of healthcare moving forward.

“Our study has demonstrated that PFP bundled payment for breast cancer care may contribute to cost containment, better adherence to quality care, and improved outcomes,” the authors wrote.