Remember Bundled Payments?
Just three years ago (July 2015) the Centers for Medicare & Medicaid Services (CMS) announced a 90-day mandated bundled payment model called the Comprehensive Care for Joint Replacement initiative (CJR).
That program was based on the Bundled Payments for Care Improvement test program launched in 2011.
In 2016, CMS announced three new bundles, referred to as episode payment models (EPMs) aimed at cardiovascular care procedures including acute myocardial infarction (AMI), coronary artery bypass graft (CABG) and hip/ femur fractures.
In 2017, CMS basically scrapped that.
Of course, when CMS was developing its bundled payment programs, private payers followed suit with their own versions. Today, approximately one-third of all healthcare providers are involved with a bundled payment style program—whether CMS or private payor.
Bundling is a middle ground between fee-for-service reimbursement (in which providers are paid for each service rendered to a patient) and capitation (in which providers are paid a “lump sum” per patient regardless of how many services the patient receives), given that risk is shared between payer and provider.
New Boss, Same as the Old Boss?
According the new head of CMS, Seema Verma, the essential problem with the three expanded bundled payment programs was that they were mandatory. They should, she said, be voluntary. And since voluntary is better, she says, the new program is an improvement—hence the name “the Bundled Payment for Care Improvement (BPCI) Advanced Model”.
We sat in on a seminar at American Academy of Orthopaedic Surgeons (AAOS) on this very topic and, lucky for us, Seema Verma, was there.
Here’s what we learned.
Two Bundled Payment Programs Were Canceled
Last November (2017), CMS tossed out two of the three mandatory bundled payment programs and slashed the number of providers that had been required to participate in the third bundled payment program—the Comprehensive Care for Joint Replacement Model (CJR).
Now, only 34 geographic areas will be required to join CJR, down from 67 originally. That will supposedly save about $106 million.
In the pre-Trump plan, 800 acute care hospitals were going to be part of the bundled payment scheme. Under this new more voluntary plan, the number is 470. Importantly, these changes were announced after CMS decided to allow Medicare payments for outpatient knee surgeries.
Seema Verma is careful to say that BPCI is not all that different from the Obama-era plan, “BPCI Advanced builds on the earlier success of bundled payment models and is an important step in the move away from fee-for-service and towards paying for value. Under this model, providers will have an incentive to deliver efficient, high quality care.”
