By Win Whitcomb, MD, chief medical officer, Remedy Partners.
The Bundled Payments for Care Improvement (BPCI) Advanced initiative is a new advanced alternative payment model (APM) that will go live October 1, 2018. The successor to the 2013 BPCI program, BPCI Advanced is CMS’ most significant episodic payment reform proposal to date, indicating the government’s commitment to transitioning to paying for healthcare value rather than volume.
BPCI Advanced, a bundled payment model for Medicare fee-for-service beneficiaries, is a voluntary program in which acute-care hospitals and physician group practices may participate as “episode initiators.” As such, they will assume clinical and financial risk for patients during the episode. BPCI Advanced encompasses 32 bundles, or episodes, that include an inpatient hospitalization and the following 90-day period (save for three outpatient procedure bundles that include the procedure and 90-day follow-on period).
Applicants can choose one or more of the 32 bundles and then commit to participate with these bundles for the first five quarters of the program, at which time they can change their selected bundles. The bundled payment is carried out retrospectively where Part A and Part B claims are summed; if total payments are less than an episode initiator-specific target price, initiators keep the difference; if total payments exceed the target price, initiators must pay back overages. Performance on seven claims-based quality metrics impacts incentive payments. Episode initiators may go it alone or participate with a “convener,” which may provide services such as care-management technology, analytics and reporting, care-redesign expertise, access to post-acute provider networks, and financial risk sharing.
CMS recently distributed to applicants historical claims and target pricing data that contains Medicare Part A and B claims for each applicant, at the individual hospital-level, mapping to the 32 bundles and a target price for each bundle. Applicants can see total spending represented by all bundles and the total number of episodes. They can also see, in aggregate and for each bundle, major areas of spending during an episode, such as anchor hospitalization, readmissions, skilled nursing facilities, inpatient rehabilitation facilities, and spending tied to home health agency services, physician services, durable medical equipment, etc.
How to Succeed
Applicants should evaluate areas of high spending, high variation or both. Since BPCI Advanced is a pay-for-improvement program, applicants should select and prioritize bundles in which there is opportunity for improved performance over the baseline period (2014-2016).
Practices that improve care coordination will do well with BPCI Advanced. But keep in mind that BPCI Advanced episodes last for 90 days following anchor hospital discharge, so any readmissions occurring during this window will affect success. The best way to address this issue is to provide longer term follow-up with patients’ key physicians and other providers. One example of this is selecting the optimal discharge destination (e.g., to home without services, home with services, or post-acute facility) based on each patient’s profile. This can help improve the use of post-acute services, which account for substantial spending during an episode.
Along with care coordination, providers should examine recent changes in their local environment that can influence performance in BPCI Advanced bundles compared to the baseline period. For example, new initiatives to reduce re-admissions or change post-acute utilization should be factored in. These can include new care coordination technology, palliative-care consult services, a heart failure clinic, or new home health agency capacity. Additional questions to ask to uncover changes versus baseline include:
- Have there been hospital closures or openings that might affect patient mix?
- Are there new post-acute facilities (e.g., inpatient rehabilitation units) that might influence post-acute spending?
- Have there been changes to service lines or physician activity that may influence volumes of selected procedures?
Technology Will be Key to Achieving a New Level of Care Coordination
Finally, hospitals and physician groups initiating episodes under BPCI Advanced will need to invest in technology infrastructure and care redesign to be successful. They must track, manage and report patient activity during all phases of an episode both at individual and aggregate levels.
Technology that provides visibility into patient activity during acute and post-acute portions of an episode, along with decision-support tools targeted at key success levers in BPCI Advanced (e.g., identifying readmission risk, post-acute network facilities or discharge destination), will help manage individual patients and direct the overall program. Providers also need to invest in care redesign, which may include the ability to negotiate price on devices through bulk purchasing, utilize post-acute networks or arrange transportation to follow-up appointments.
We commend CMS for launching BPCI Advanced. The model provides a significant opportunity for physicians to meet Advanced APM thresholds as specified in the Quality Payment Program under Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). And as the largest Convener in the existing BPCI program, Remedy Partners has seen that bundled payments are effective into improving outcomes and reducing costs.