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David Morales, DHCFP Logo



Over the past few months, I've provided you with updates regarding the Division's work on Chapter 288, the small business health care bill passed in August. Section 64 of Chapter 288 directs the Division to foster the adoption of one of many an innovative methods being utilized  in health care delivery: bundled payments.

Bundled payments combine payments for all relevant services associated with a defined episode of care, such as hospital admission, ambulatory care, and other clinical services, under one single fee. Bundled payments – if structured correctly – will encourage providers to work together to coordinate patient care, improve quality, reduce adverse events, and thereby reduce costs. It may also support transparency and allow consumers and employers to know up-front what the cost of their care will be and offer them the opportunity to compare similar services among different providers.

As such, the Division is currently reviewing the existing landscape of bundled payments nationally, in order to most effectively facilitate their adoption in the Commonwealth. We have been examining approaches like Minnesota's work around defining “baskets of care” and the Health Care Incentives Improvement Institute development of the PROMETHEUS payment model.  We are also actively meeting with stakeholders to gather information about similar arrangements that may already exist among private payers in Massachusetts. In addition, we have assembled a group of representatives from various state government agencies to design a strategy that will promote bundled payment pilot programs.

Over the next few months, the Division will publish a series of reports to assist organizations that may be considering bundled payments. The reports will describe existing bundled payment structures, available funding and logistical support, suggest acute and chronic conditions around which to build bundled payments, and discuss how bundled payments may encourage a transition toward a more integrated payment model.

This initiative will require hard work, collaboration, and creativity among a multitude of stakeholders in the Massachusetts health care system. This process also will bring all of us closer to a health care system that rewards value and prioritizes containing rising health care costs for employers and consumers.

I look forward to continuing the discussion about new methods to contain costs and improve the health care delivery system in Massachusetts.



As a part of our commitment to transparency and engagement in government, the Massachusetts Division of Health Care Finance and Policy uses several social media tools including Twitter, Blogs, and RSS feeds. We use these tools to keep you informed about the work we are doing and as a way to get feedback. You can follow us on Twitter, and you can learn more by visiting the Commonwealth Conversations: Mass Health Care blog.

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