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Physician group practices struggle with bundled payments: study

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Bundled Payments Worry Physician Group Practices

Physician group practices are finding it difficult to adjust to the current reimbursement system of bundled payments, according to a recent study. This system, which pays a set amount for episodes of care, is meant to motivate providers to provide cost-effective care, but for many physician groups it hasn’t been easy to navigate.

Advantages and Disadvantages of Bundled Payments

The decision to transition to a bundled-payment model often has advantages and disadvantages. The advantages are:

  • Cost Savings: This type of payment model can result in lower healthcare costs.
  • Efficiency: Bundled payments make it easier to coordinate care and increase efficiency within a healthcare system.
  • Incentive Structure: It puts pressure on providers to provide cost-effective care.

On the other hand, there are some disadvantages to bundled payments:

  • Documentation Requirements: Providers must go through additional documentation and administrative work.
  • Risk of Loss: Providers take on the financial risk of potential losses or expenses when accepting bundling payment.
  • Difficulty Adjusting: Many physician group practices have difficulty adjusting to the new reimbursement system.

Reasons for Struggling with Bundled Payments

The study revealed several reasons why physician group practices are struggling with bundled payments.

The first reason is a lack of infrastructure: many group practices don’t have the necessary mechanisms in place to support the data collection and analysis necessary to make the transition success.

Second, physician group practices often lack the financial resources to invest in the infrastructure needed for bundled payments. This can make it difficult to measure their performance and make necessary adjustments.

Lastly, a lack of cooperation between providers is another obstacle to success. Many provider groups are not incentivized to cooperate with each other in order to make cost-efficient decisions that would benefit all parties.


While bundled payments have the potential to lower healthcare costs and improve efficiency, the reality is that physician groups find them difficult to adjust to. The study looks at several reasons why, such as a lack of infrastructure, financial resources, and cooperation between providers. It remains to be seen if group practices can work together to overcome these challenges and make bundled payments work for them.

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