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Bundled Payments May Extend to Other Services, Payers

CMS plans to launch Oncology Care Model

The recent move by the Centers for Medicare & Medicaid Services (CMS) to require bundling of reimbursement for hip and knee surgeries is just the beginning of its efforts to link provider profits with costs and quality metrics, according to an article posted on the HealthLeaders Media website. Next year, the agency will launch the Oncology Care Model to spur cancer physicians to reduce hospital and pharmacy costs, partly through better care coordination.

The CMS is likely to move on to other services shown to be ripe for improving quality and cost effectiveness, the article says.

The most likely next targets are several medical conditions that have demonstrated positive outcomes under the Bundled Payments for Care Improvement (BPCI) Initiative, which offers voluntary bundling for 48 conditions. The standouts from that model include congestive heart failure, pneumonia, and stroke.

Under the Patient Protection and Affordable Care Act, the Secretary of the Department of Health and Human Services has the authority to scale any pilots after the CMS actuary can attest that savings have occurred with no decrease in quality.

The CMS has been working toward bundled payments for some time and is finally pulling the trigger, said Rob Lazerow, practicing manager with the Advisory Board Company, a consulting practice based in Washington, D.C. Good results from earlier efforts, such as the Acute Care Episode Demonstration, which bundled orthopedic and cardiovascular procedures, spurred the CMS to act on the BPCI results sooner than some might have expected, he said.

“I think it's safe to assume that CMS is betting big on the promise of bundled payments to make care higher quality and more efficient,” Lazerow said. “It is likely that they are going to expand to more conditions after starting with hip and knee, and I expect they will continue to focus on the areas where they have been experimenting with bundled payments in the past. I think that is much more likely than introducing entirely new areas for bundling.”

Knee and hip procedures were the most popular procedures for voluntary bundling under the BPCI, but Lazerow noted that congestive heart failure and chronic obstructive pulmonary disease (COPD) also were high on the list. The CMS is likely to factor that into deciding where to go next with mandatory bundling.

Percutaneous coronary intervention (PCI) is another likely option for bundling, based on past efforts to improve quality and costs.

Lazerow expects to see bundling grow beyond inpatient-triggered episodes to include ambulatory episodes, post-acute bundles with a single price regardless of site of service, and chronic bundles.

In the move toward bundling, most health care leaders are willing to share claims data to help evaluate performance across the care continuum, but they worry that delays in data-sharing could hinder the ability to quickly engage physicians in standardization and improvement efforts, according to Richard Bajner Jr., managing director of Navigant Consulting in Chicago. Post-acute providers have expressed concern about the development of preferred partnerships without having the full picture, specifically the ability to risk-adjust patients on only the claims data provided to financially evaluate episodes.

Bajner expects commercial insurers and providers to follow CMS’s lead.

“As payers and providers gain experience with bundled payments, providers will explore opportunities to either partner with commercial payers on high-volume conditions and/or explore ways of directly serving employers with a bundled-payment partnership,” he said. “We anticipate a growth in bundled payments in the commercial market, as well as by Medicaid.”

Source: HealthLeaders Media; July 27, 2015.


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