Bundled Payment Pilot

Dissecting DRGs for Bundled Payment

The Proposed Mandatory Medicare Bundled Payment Program - 15 Things to Know

On July 9, CMS released a proposed rule describing its Comprehensive Care for Joint Replacement (CCJR) payment model, a pilot bundled payment program for major joint replacements of the lower extremity. While CMS’s increasing interest in bundled payments has been apparent, the announcement of this mandatory initiative was a surprise to many, given that the Bundled Payment for Care Improvement (BPCI) demonstration program is still in its early stages for many participants.

CMS Announces Mandatory Joint Replacement Bundles

Yesterday CMS issued a proposed rule for the Comprehensive Care for Joint Replacement (CCJR)  a proposal to require all episodes of Major Joint Replacement in 75 MSAs to be paid on a "bundled" basis. This is a significant step from the voluntary Bundled Payment for Care Improvement program in that it requires virtually all hospitals (but not physicians or other providers) to be financially responsible for all of the care of these patients for 90 days after discharge. Hospitals in 75 Metropolitan Statistical Areas (MSAs) would be affected.

Thirty-Day BPCI Episodes? Let the Data Drive the Decision

In recent conversations, articles and seminars we’ve heard wary potential BPCI Model 2 participants propose to select a 30-day episode length as a “safer” alternative to the longer 90-day episode.  In some cases the shorter episode length does provide some risk mitigation against uncontrollable high costs such as readmissions. However, that safety comes at a price that may not be warranted. This is because of these two factors: 

Combining Clinically-Similar Bundled Payment Episodes to Reduce Risk and Improve Care

Jonathan Pearce, CPA, FHFMA and Coleen Kivlahan, MD, MSPH

The Medicare Bundled Payment for Care Improvement (BPCI) program allows participants to assume financial risk for all Medicare services occurring within 30 to 90 day period after hospital discharge. Model 2 participants give up 2% of the episode target amount as a discount to CMS in 90-day episodes, but are allowed to retain any savings from Medicare cost reductions below the target amounts.

Another Look at BPCI Risk Track Selection

As the deadline for submission of April 2015 applications for the Bundled Payment for Care Improvement (BPCI) initiative looms, many applicants are trying to figure out the best approach to selecting risk tracks for various episodes. Some participants are looking for "algorithms" that can assist them in selecting the most appropriate risk track, while others are noting that risk track can be changed throughout the participation period, and may wish to switch risk tracks based on their performance during a previous quarter.

Why Some DRGs May Never Be Appropriate for Bundling

 Initially some BPCI participants were intrigued with the idea of participating in limited, procedurally-based episodes such as percutaneous coronary interventions (PCI) episodes in the Medicare Bundled Payment for Care Improvement program.

Analytics Challenges for Advanced Payment Systems

We've frequently commented on the need for up-to-date skills and computer hardware and software to be able to analyze the data that accompanies participation in capitated and bundled payment programs.  This HIMSS article highlights some of those issues and the barriers that they present to successful participation.

How BPCI Episode Precedence Affects Health System Strategy

Jonathan Pearce, CPA, FHFMA and Coleen Kivlahan, MD, MSPH

Many participants in “Phase I” of the Medicare Bundled Payment for Care Improvement (BPCI) program were surprised by their first look at the impact of CMMI’s BPCI precedence rules when comparing  two sets of baseline data recently provided by CMS. This data show the number of episodes and target prices for episodes under two scenarios:

Which Episodes Should I Bundle for BPCI

by Jonathan Pearce, CPA, FHFMA and Coleen Kivlahan, MD, MSPH

Applicants to the Medicare Bundled Payment for Care Improvement (BPCI) program will be busy spending December identifying episodes for which they should participate when they "go live" in April. Several episode families are common candidates for participation, and an overview of their characteristics is described below.

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