On the need for bundled payments in Medicare

February 24, 2012

Three highly qualified experts wrote this thoughtful post for the Health Affairs Blog, examining how the recurring brinksmanship attending the SGR “doc fix” distracts from a larger discussion that needs to happen around how to save money on Medicare in the coming decades.

Such a discussion must begin with the recognition that the purpose of the Medicare system is not to save money.  If our goal was to spend less, we could abolish the system and spend nothing.   The goal of Medicare is to provide protection for elderly Americans against the financial risk associated with illness, and in the process provide beneficiaries with access to high quality care.  Our challenge is to accomplish those goals in a fiscally sustainable manner.

The three authors, (Michael Chernew, PhD, Professor of Health Care Policy in the Department of Health Care Policy at Harvard Medical School; Darius Lakdawalla,  Director of Research at the Schaeffer Center for Health Policy and Economics at USC; and Dana Goldman, holder of the RAND Chair in Health Economics and Director of Health Economics at RAND) have written a cogent and thought-provoking argument for the economic necessity of bundled payment systems in Medicare.

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