New York, NY, January 30, 2013—Booz & Company announced today the results of a survey polling 1,000 U.S. consumers on their interest in bundled healthcare packages. The findings demonstrate strong support among healthcare consumers for the introduction of bundled care in the marketplace: Fully 78 percent of respondents expressed that the concept was appealing to them.
This survey is the first in a series of research efforts from Booz & Company on ways to transform healthcare delivery and financing in the face of rising healthcare costs, an aging population, and the implementation of the Affordable Care Act. Forthcoming research in 2013 will gauge interest and sentiment from different stakeholder groups integral to the success of bundled healthcare: physicians, hospitals, payors, and employers. Booz & Company will conduct this research annually.
“Healthcare leaders know the time has come to figure out how to make high-quality, affordable care accessible to more people,” said Gary Ahlquist, senior partner in Booz & Company’s North American health practice. “This survey shows there is an active appetite for change from traditional approaches to healthcare delivery, and suggests what a viable new model could look like.”
Bundled healthcare is a model in which patients are offered a complete package of care, financing, and support for a specific condition—a break with the de facto medical model of fee-for-service (billing separately for each activity). In bundled care, a single fee covers every individual action related to a condition or procedure from end to end.
Booz & Company has worked on bundled healthcare design and implementation since 2006, when it helped initiate a payor/provider partnership in Florida to develop and roll out two bundled care offerings. Until now, however, the U.S. healthcare system’s fragmented care delivery, information availability, incentives, and standards have blocked widespread adoption of bundles.
”The groundwork for bundled care is finally being laid,” said Minoo Javanmardian, partner in Booz & Company’s North American health practice. “Recent healthcare policy changes, an increasingly integrated IT infrastructure, and the affirmation of the Affordable Care Act are enabling insurers and providers to share data, share risk, and get patients to take more responsibility for their own care. All these things are critical to transforming care delivery.”
Perhaps the strongest indicator that bundled care will be a core part of the future healthcare system is the support it is receiving from such top private employers as Walmart, Lowe’s, and Boeing. Beginning this year, Walmart, the world’s largest private employer, will be partnering with leading providers to offer bundled care for a number of common procedures.
The study, Bundled Care: The Voice of the Consumer, can be downloaded here >
Key Data Highlights
- Respondents indicated that they are increasingly willing to switch hospitals (50 percent) and specialists (45 percent) for bundles that are significantly lower-priced (meaning at least 10 percent less than existing coverage).
- Consumers showed a clear preference for bundled offerings from physicians, hospitals, and employers; 30 percent more consumers ranked these bundles as attractive choices compared to those offered by retail stores, online insurance aggregators, or brokers.
- Among all stakeholders, primary care physicians enjoyed the greatest loyalty from consumers; 64 percent said they would not change from their existing physician or choose one based on bundle availability.
- Consumers remain largely unwilling to travel extensively to receive care under bundles; 74 percent were willing to commute within their own city and no farther. Rural residents were much more willing to travel regionally than were urban and suburban residents.
- Of the benefits available through bundles, patients saw the ability to provide input in their care processes, coordinated care, and warranties as the most appealing. More than 50 percent of respondents ranked these as the top three benefits.
- Consumers ages 31–49 are most likely to find bundles appealing (86 percent), offering commercial payors and hospitals a test bed for innovation outside Medicare and Medicaid programs.
- A large majority of consumers (80 percent) prefer bundled coverage across all settings in the care continuum, from initial physician consultation to post–acute care and rehab.
North America Marketing