The ongoing upheaval around healthcare reform reflects the fact that spiraling cost increases, coupled with lagging quality outcomes and a chronic lack of transparency have gotten the attention of payers, patients, and policymakers. Healthcare delivery organizations face growing pressure to address these issues. Bundled pricing is an innovation being implemented by market leaders that promises to do so. As such, it is one of a handful of fundamental changes that will see broad implementation in the near future.

In its most basic form, bundled pricing offers a fixed price for a defined set of services. But without consideration for the quality or the relative value of these services, the stage is set for accelerating commoditization. Deceptively simple sounding, this radically different approach to pricing and risk brings its own challenges. Delivery organizations considering bundled pricing should carefully evaluate their readiness for implementation. Failure to do so invites both organizational and financial setbacks.