CMS Unveils New Voluntary Bundled Payment Model

CMS on Tuesday unveiled plans for an expanded bundled payment model that calls for participants to take on risk in both inpatient and outpatient settings, and that will qualify providers for additional incentives under the 2015 Medicare Access and CHIP Reauthorization Act (MACRA).

The model, the Bundled Payments for Care Improvement (BPCI) Advanced, is the next generation of the BPCI models already operating around the country; as of October 2017, CMS reported that BPCI Model 2 had 514 participants in phase 2. Under this new step, the 32 clinical episodes include 3 outpatient episodes, in addition to inpatient episodes, which appear to largely track those previously offered through the Center for Medicare and Medicaid Innovation.

"We're very happy that it's finally here," Darcie Hurteau, MBA, director of Informatics for DataGen, said in an interview with The American Journal of Managed Care^®. The majority of the episodes overlap with those "defined in the original program," she said, although she wants to see details before assuming they will be based on the same data.

A politically relevant aspect is that BPCI Advanced comes after CMS canceled an Obama-era proposal for mandatory bundled payments in cardiac care, as well as a mandatory expansion of a program in joint replacements. Of note, episodes included in this new voluntary model include several cardiac care episodes, including percutaneous coronary intervention and cardiac defibrillator episodes in outpatient settings; Hurteau said including these episodes should allow providers to capitalize on their preparation for the planned mandatory model.

While proponents of mandatory bundled payments said they were showing early savings, hospital groups said CMS was moving too quickly with mandatory models, and others said the program was too bureaucratic. Still others believe that the expansion of accountable care organizations represents the best way for healthcare providers to ensure better care coordination and outcomes.

BPCI Advanced will work like other bundled payment models in that providers must keep spending within a set budget while meeting or exceeding quality measures. In a statement, CMS said, “Participants bear financial risk have payments under the model tied to quality performance, and are required to use certified electronic health record technology.”

CMS said this will allow providers who use the model to meet requirements of an advanced alternative payment model (APM), the more advanced of 2 value-based payment structures under MACRA. In this way, the model appears to meet expert predictions that the current administration will push providers toward risk-based reimbursement models with carrots instead of sticks.

“CMS is proud to announce this administration’s first advanced APM,” said CMS Administrator Seema Verma in a statement. “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-value care.”

Applications for the model are due on March 12, 2018, and the first cohort will begin on October 1, 2018, according to CMS. Information published Tuesday said that BPCI Advanced will initially cover 29 inpatient episodes and 3 outpatient episodes, with the possibility revising the list for both new and existing participants beginning January 1, 2020. Those who join with the first wave cannot leave the program before January 1, 2020.

Hurteau said providers will want to see additional details of the 32 episodes as well as the quality metrics, which will help them decide whether to apply this year. Positive aspects of the model, in her view, are plans to evaluate providers based on their own historical data, as well as the ability of participants to qualify for advanced APM.

Other details to be worked out, she said, including who "owns" an episode--a physician practice or an acute care provider--after the second wave of enrollment. The window for getting data, evaluating options, and making a decision is relatively short, especially for those practices that have not taken part in earlier rounds of BPCI, Hurteau said.

Chris Garcia, CEO of Remedy Partners, said in an email to The American Journal of Managed Care^®, that the company is pleased CMS is continuing the BPCI Advanced program through 2023.

"This is another positive step forward for bundled payments being part of Medicare's permanent payment policy, and we expect it will fuel the continued expansion of bundled payment methodology into commercial, Medicaid and self-insured markets," he said. "We look forward to our continued partnership with CMS and working with many new provider participants that we anticipate will be joining the program.”