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Medicare Delays Expansion of Bundled Payments Program

News  |  By Christopher Cheney  
   March 22, 2017

CMS has put on hold the rollout of three new cardiac episodes of care and the addition of hip fractures to the Comprehensive Care for Joint Replacement bundled-payment program.

The announcement this week that the Centers for Medicare & Medicaid Services will delay implementation of four Medicare bundled-payment initiatives is merely a pause and does not signal the demise of episode-of-care payment models, says one orthopedic surgeon.

The bundled-payment initiatives had been slated to launch on July 1. The new launch date is Oct. 1.

"The delay in the cardiac bundles and femur fracture bundles is simply related to the inability to work out the details of each bundle such that the doctors and hospitals involved can effectively manage the episodes," says Louis Levitt, MD.

CJR Outcomes Vary Widely, Driven by 2 Factors

Levitt is a practitioner and vice president at Washington, DC-based Centers for Advanced Orthopaedics and an assistant clinical professor at George Washington University.

In an interim final rule with comment period filed Monday, CMS put on hold the rollout of three new cardiac episodes of care and the addition of hip fractures to the Comprehensive Care for Joint Replacement bundled-payment program.

The cardiac episodes of care placed that remain pending are:

  • Acute myocardial infarction
  • Coronary artery bypass graft
  • Cardiac rehabilitation

Levitt says CMS needs to step up its bundled-payment game before implementing the new initiatives, which would add an acute-care episode to CJR for the first time. Currently, the CJR bundled-payment models apply only to hip and knee replacement procedures.

"When you try to create a bundle for an acute-care episode like a femur fracture, you are dealing with significantly more variables in a sicker population. The cost of care for the acute injury is going to be more unpredictable and more difficult to control, hence the higher costs," he says.

Adding hip fractures to CJR requires a more robust approach to assessing risk and patient-to-patient variability, Levitt says.

"To engage doctors in managing acute injuries through bundles, you are going to have to work out the details of the bundle well in advance to anticipate all clinical scenarios. Because of these challenges, the bundles for acute injuries are not yet effective—hence the delay in implementation."

To be financially sustainable, bundled payments for acute-care procedures require fully engaged physicians, he says. "The future for all doctors will include their managing more effectively the entire episode of clinical care. One will no longer just be a surgeon. Now, in order to truly produce the best outcomes for our patients, we must be care managers overseeing every detail of their treatments."

Current Model 'Flawed'
CJR should be retooled before hip fracture is added to the bundled-payment program, says James Caillouette, MD, chief strategy officer at the Hoag Orthopedic Institute in Irvine, CA.

"While I fully support value-based care, the lack of acknowledgment of the variance in patient risk—comorbidity—makes the current version unsustainable."

Bundled-payment models for acute-care services pose an inherent financial challenge for healthcare providers, Caillouette says.

The model works best for elective surgery, he says, "where patient health variables can be affected prior to surgery in order to reduce the risk of complications."

In cases of emergent surgery for lower extremity fractures or cardiac cases, "the current program as designed by CMS is flawed because the providers are unable to drive value to the greatest degree possible by having the opportunity to optimize patients for surgery."

The interim final rule was signed by Health and Human Services Secretary Tom Price and CMS Administrator Seema Verma.

CMS is accepting public comment on the bundled-payment initiatives through April 20. Commenters are invited to weigh in on whether implementation of the bundled-payment initiatives should be delayed further to Jan. 1, 2018.

Christopher Cheney is the CMO editor at HealthLeaders.

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