The Medicare and Medicaid Innovation Center (CMMI) announced a new payment program which is focused on acute care episodes paying providers a single fee for all the services required to deliver a patient's care episode.
Yesterday the Innovation Center announced they are willing to partner with health systems and conveners of multiple health systems to pay them with bundled payments. This is a welcome turn of events for organizations that are working on payment reform but aren't interested in becoming an Accountable Care Organization (ACO).
The options for this initiative vary as to whether the health system wants to bundle both inpatient and outpatient components of a care episode or just the inpatient episode. Organizations can work with conveners of participating healthcare providers such as the Partnership for Healthcare Payment Reform in Wisconsin or directly with CMMI. The good news for Wisconsin is there has already been a great deal of work done on bundling and the CMMI proposal may help support many of the providers already involved with it.
In a prepared statement CMMI says: "To help facilitate health care innovation, recognize the diversity of provider organizations, and cultivate strong provider partnerships, applicants are asked to submit their own episode definitions and bundled payment proposals. CMS will provide historical Medicare claims data to potential applicants planning to apply for Models 2-4. The data are intended to enable potential applicants to develop well-defined episodes and discount proposals based on the experience of providers in the applicant’s area".
Two types of payment are proposed, in the retrospective method "CMS and providers would set a target payment amount for a defined episode of care. Applicants would propose the target price, which would be set by applying a discount to total costs for a similar episode of care as determined from historical data. Participants in these models would be paid for their services under the Original Medicare fee-for-service (FFS) system, but at a negotiated discount. At the end of the episode, the total payments would be compared with the target price. Participating providers may then be able to share in those savings". In the prospective method, CMS would make a single, prospectively determined bundled payment to the hospital that would encompass all services furnished during the inpatient stay by the hospital, physicians and other practitioners. Physicians and other practitioners would submit “no-pay” claims to Medicare and would be paid by the hospital out of the bundled payment".
Obviously, many details and questions remain but overall a good start for an important payment reform initiative from the federal government.
Read the entire fact sheet http://dev.phprwi.com/Partner_Resource_Docs/Fact-Sheet-Bundled-Payment-FINAL82311.pdf
The RFA itself is below.
Request_for_Applications
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