Bundled payments in healthcare, paying for a set of services, not “per unit of care delivered’ under the fee-for-service model, have had their government deadlines rolled back to October.  Even so, many industry experts are continuing to call for mandatory implementation.  Go or no-go?  We take a look at the latest roundup of thoughts and advice.

Bundled Payments in Healthcare

Though CMS has rolled back deadlines, bundled payments look likely to become mandatory as revenue cycle teams scramble to accommodate the trend.

Modern Healthcare is reporting that “The CMS has delayed the expansion of a major bundled payment pilot, Comprehensive Care for Joint Replacement, and the implementation of its bundled payment initiatives for cardiac care from July 1 to Oct. 1, 2017, according to an interim final rule posted to the Federal Register. It also delayed, for a second time, the effective date of a final rule laying out the implementation of CJR and other bundled payment programs, from March 21 to May 20, 2017.”

Will there be a longer delay?  Possibly.  Becker’s Hospital Review recently published some comments along this line, quoting the interim final rule, published in the Federal Register: “…the additional 3-month delay is necessary to allow time for additional review, to ensure that the agency has adequate time to undertake notice and comment rulemaking to modify the policy if modifications are warranted, and to ensure that in such a case participants have a clear understanding of the governing rules and are not required to take needless compliance steps due to the rule taking effect for a short duration before any potential modifications are effectuated,” according to the interim final rule. The same article notes that CMS said in the interim final rule that it is seeking comment on possibly further delaying the implementation of the cardiac bundles and expansion of the CJR model. The agency said it believes a delay until Jan. 1, 2018 is warranted.

But even though the deadlines are being rolled back, experts continue to say that bundled payments should be mandatory.  CMS currently has two compulsory bundled payment models: the Comprehensive Care for Joint Replacement (CJR) model and cardiac bundles under the Episode Payment Model (EPM).  These have deadlines that being pushed back.  According to RevCycle Intelligence, five healthcare policy experts from the Brookings Institution have argued that “making these models optional would eliminate the ability to generate robust evidence on their effectiveness, dealing a severe blow to efforts to use bundled payments to improve care delivery in orthopedics and cardiac care, and to the chances for bringing bundled payments to scale nationally in the coming years.”

Health Affairs Blog is reporting that a lot depends on how the new Trump administration handles the policies.  They write, “In particular, the Administration must soon decide whether to continue with the large-scale demonstration projects testing bundled payments for hip and knee replacements, hip fractures, bypass surgery, and heart attack. Secretary Price and others have criticized these models on a number of grounds, most importantly that they require all providers in selected geographic areas to participate. The Administration recently delayed the start date for the newer cardiac bundles program, raising some questions as to whether HHS will proceed with the program under its current structure.”

What’s Next for Bundled Payments in 2017?

So… what’s next?  At the end of March this year, Forbes published an article asking much the same thing.  Noting some mixed messages from the administration, Forbes observes, “…before becoming secretary of health and human services (HHS), Tom Price spoke out against Medicare’s mandatory bundled payment initiatives. Furthermore, it was reported that he was likely to “pull the plug” on a mandatory five-year pilot, scheduled for launch on July 1, to hold hospitals in 98 markets financially accountable for the cost and quality of care associated with bypass surgery and heart attacks. But, in February, an HHS spokesman said the launch would go forward as scheduled.”  The article goes on to note some positive (lowered costs) results from studies of hospitals participating in bundled care programs.  Ultimately, they conclude, “It seems that, regardless of what direction HHS ultimately takes, bundled payments for episodes of care are an increasing part of the shift toward value-based reimbursement that is spreading through the healthcare sector.”

Then there’s a recent article in Healthcare Finance that predicts healthcare organizations will stay the course on bundled payments.  “Payers need more predictability in cost, and bundles provide a tangible way to get there, according to Carolyn Magill, CEO of Remedy Partners, a firm that provides services to close to 70 percent of participants in CMS’ Bundled Payment for Care Improvement initiative.”

Unless a hard brake and reverse are applied, it looks like bundled payments train has left the station.  Becker’s Hospital Review notes that “an overwhelming 97 percent of health plans and 91 percent of hospitals are now deploying a complex mix of value-based reimbursement and fee-for-service reimbursement. Health plans and hospitals see bundled payments as the fastest growing value-based payment model and predict bundled payments will account for 17 percent of reimbursements in the next five years.”

For revenue cycle directors, a lot depends on your claims platform.  In the same long article (a great overview) Becker’s lists some “key components of a useful claims platform” which we include here since it also goes to the core of The SSI Group’s mission in providing leading revenue cycle management software solutions:

Key Claims Platform Components:

  • Business front-end application that makes data analysis quick and easy
  • Secure platform that requires validation and authentication for access
  • Detailed and organized view of episode data and all associated costs and outcomes
  • Access to standard and customized reports
  • Cloud-based to limit burden placed on internal IT and reporting teams
  • Dynamic data updated automatically

This is our second article on bundled payments and we will continue to cover the subject as it increases in importance for our clients’ revenue cycle management concerns.