Healthcare Consumer, Meet Bundled Payments

Story Highlights

  • Healthcare consumerism, driven by ever-increasing healthcare costs and rising deductibles, have caused active shopping for healthcare services.
  • Physicians are increasingly expected to assist the patient in finding best-value services for prescribed procedures.
  • Patient satisfaction assessments are commonly used to reflect the perceived value people receive from their physicians.
  • Bundled payments for single episode healthcare services lower costs, improve outcomes and generate high patient satisfaction scores.

By Scott Leggett

Consumerism is coming to healthcare. Count on it.

What is consumerism? Google the word and you will find it defined as the “protection or promotion of the interests of consumers.”

Translate consumers to patients and consumerism in healthcare means the protection and promotion of the interest of patients.

If that sounds a lot like what doctors do every day in their care of patients, you are partially correct. Physicians, by definition, protect the interests of patients and help promote the patient’s interest in their own good health.

What about the promotion of the interests of patients? Here the word promotion takes on an economic cast. That is, while the doctor protects the interests of the patient by healing those who are ill or contributing to the wellness of the healthy, the doctor promotes the interests of the patient by keeping an eye on costs and providing guidance to patients on cost savings and healthcare services.

Is Healthcare Consumerism Real?

In a research study conducted in 2016 by Porter Research and Navicure, nearly two-thirds of responding physicians reported that healthcare consumerism is a consideration with their patients. Almost 70% reported patients are price shopping. More than half of all patients ask about payment plans, and a roughly equal number inquire about the total cost of anticipated treatment.

Clearly, physicians are already encountering the impacts of healthcare consumerism. And while a majority of surveyed doctors reported encountering patients expressing concern about healthcare costs, the study only briefly touched on the fact that nearly half of all patients are inquiring about total payment costs and payment plans. This interest in costs and services will continue to grow and represents the coming wave of healthcare consumerism.

Then there is the issue of consumer choice and how the consumer chooses a doctor. Consumerism at its essence is about choice. For healthcare the manifestation of this choice is expressed as patient satisfaction.

As a further indication of the rise in healthcare consumerism, consider that by 2023 millennials as a generational group will be the largest consumers of healthcare services in the U.S. It is anticipated that they will further accelerate the healthcare consumer movement since they have grown up using electronic media and making informed choices in their role as consumers, just as they have grown up expecting to be satisfied by the outcomes of those choices.

As noted by Dr. Kevin Pho on his widely followed website,, “As healthcare slowly transitions to a consumer-driven business, patient satisfaction becomes an increasingly important variable in how patients select their care providers.”

Bundled Payments

Enter bundled payments. This well-established approach to packaging healthcare costs — patient pays one amount for all services related to a single episode of care — follows a familiar practice for virtually everything the consumer/patient buys outside of healthcare. Consumers buy specific goods or services and pay one fixed price, such as with the purchase of a house or car.

Bundled payments in healthcare are analogous to packaged pricing elsewhere in a consumer’s life, providing both a single price for goods and services and price transparency.

For the consumer, “episode of care payments” probably sounds like healthcare jargon. However, packaged pricing is how consumers save money at Costco. They get the idea of packaged pricing, and they get price transparency.

Protect and Promote

It is in the interest of the patient to improve care and ensure best outcomes. It promotes the interest of the patient by simplifying their interaction with the healthcare system, which is too often complicated and mind-boggling to the consumer of healthcare services. It most definitely promotes the interests of patients to lower the cost of healthcare services.

Bundled payments do all of this.

As a physician, protecting the interests of your patients comes as second nature. Now is the time to promote the interests of your patients as well.

Bundling payments equips you to protect and promote at the same time. Your patients will be grateful. So will their checkbooks!