Bundled Payments: Advancing CMS Innovation to a New Level

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Bundled Payments is yet another step forward in the movement toward value-based healthcare.

The Centers for Medicare & Medicaid Services (CMS) has launched a new voluntary bundled payment model, called Bundled Payments for Care Improvement Advanced (BPCI Advanced). The program is the next generation of the original BPCI initiative created by Medicare – and another step forward in the movement toward value-based healthcare.

“The program pays physicians and healthcare organizations for a defined episode of care, instead of for individual services – giving clinicians and hospitals incentives to improve quality and lower costs,” says Dunnie Norman, senior vice president of sales at Vivify Health. An international digital-health company, Vivify has been a major player in providing innovative technology for remote care management to transform healthcare delivery.

BPCI Advanced includes 32 inpatient clinical episodes, with 29 in the inpatient setting and three in the outpatient setting. These episodes could change going forward, as CMS may choose to revise them annually beginning January 1, 2020. An Advanced Alternative Payment Model under the Medicare Access and Children’s Health Insurance Program (CHIP) Reauthorization Act of 2015 (MACRA) Quality Payment Program, BPCI Advanced offers a key opportunity for healthcare organizations to generate revenue – through a 5 percent bonus payment – by improving post-acute outcomes and reducing costs.

Maximizing Quality

“As the healthcare industry moves away from its traditional fee-for-service model to value-based care, payments no longer hinge on the number of services provided,” says Norman. “Now, it’s all about quality. BPCI Advanced is one way to make sure hospitals, physicians, and post-acute care providers share accountability for patient outcomes.”

CMS selected seven quality measures for BPCI Advanced. Two of the seven – the all-cause hospital readmission measure and the advanced care plan measure – will be required for all clinical episodes. The other five measures will apply only to select clinical episodes.

Provider payments will be based on quality performance during a 90-day episode of care. A clinical episode begins at the start of an inpatient admission to an acute care hospital, called the “anchor stay,” or at the beginning of an outpatient procedure, called the “anchor procedure” – and ends 90 days after the end of the anchor stay or the anchor procedure. 

“BPCI Advanced is critical to improving post-acute care management of patients,” Norman says. “The incidence of readmissions for patients with chronic diseases is high – as much as 25 percent – in the first 30 days after hospital discharge. This return to acute care has huge financial and quality consequences for healthcare providers.”

Mapping the Timeline

Providers have until March 12, 2018, to apply for the BPCI Advanced program. CMS will offer a second opportunity to apply for the program in January 2020. The performance period for the first group of participating providers will begin October 1, 2018, and will continue through December 31, 2023. Health care organizations selected to participate in BPCI Advanced beginning October 1 will be accountable for at least one clinical episode and may not add or drop clinical episodes until January 1, 2020.

Marking Another Milestone in Government Innovation

BPCI Advanced builds on the work of the CMS Center for Medicare and Medicaid Innovation (CMMI) and the foundation of the first BPCI initiative, which started in April 2013 and will end on September 30, 2018. Created by the Patient Protection and Affordable Care Act, CMMI is designed to test innovative payment and delivery system models that demonstrate promise for maintaining or improving the quality of care in Medicare, Medicaid, and CHIP – while slowing the rate of growth in program costs.

“At Vivify, we believe remote care management technology is vital to advancing new payment models and, ultimately, supporting the goals of CMMI,” Norman says. “This technology can help healthcare providers enhance continuity of care, empowering the clinical team to proactively monitor patient biometrics and symptoms, use technology to help patients self-manage conditions, and engage patients to be partners in their care. It also enables cost control by keeping patients healthy in their homes and averting costly hospital readmissions.”

Moving from Voluntary to Mandatory?

Alex Azar, the new secretary of the U.S. Department of Health and Human Services, has said he would support mandatory testing of value-based payment models through CMMI. His view is in marked contrast to that of his predecessor, Tom Price, MD, as well as the Trump administration, which canceled and scaled back key mandatory bundled payment initiatives in 2017.

“The industry needs to be thoroughly prepared for the prospect of the BPCI Advanced program becoming mandatory,” Norman says. “The shift to value-based care everyone’s been talking about for years is rapidly happening. Healthcare organizations will need to figure out how to move beyond the four walls of the hospital to continuously engage with patients in their homes. Those who are operationally ready to deliver care anytime, anywhere – and manage health outcomes for larger and larger populations – will be best equipped to lead the way in a quality-focused, value-driven world.”

Alex Azar, Secretary of the U.S. Department of Health and Human Services

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Vivify Health is transforming healthcare with the market’s most comprehensive patient-centered connected care platform, spanning from remote monitoring of high-risk patients and patient activation to population and employee health. Vivify’s platform is the digital pathway to collaborative care on demand — with a focus on ease of use for employees, members, patients and providers.

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