Medicare’s Bundled Payment Initiatives: Evidence for Evolution

Delivery System Reform

By Roxanne Bangalan

Medicare has long experimented with bundled payment models to contain health care expenditures. Under bundled payment models, payers pay a fixed amount for services associated with an episode of care. In a new Milbank Quarterly review, Christine A. Yee and colleagues examined 16 of Medicare’s payment programs for hospital-initiated episodes. These initiatives varied in their design features and evaluation results were mixed. For instance, readmission rates improved and worsened, depending on the features of the bundled payment model. However, the researchers found that bundled payment initiatives can help slow the growth of payer spending. Learn more about how various design features impacted Medicare spending.