Among the 232 health care providers that have entered into agreements in the now 1-year-old Centers for Medicare & Medicaid Services (CMS) Bundled Payments for Care Improvement initiative, 21 acute care hospitals have begun the second phase of the payment model that is the cleanest break with traditional fee-for-service.
Most health care organizations selected to participate are doing so in payment models that are more closely related to traditional fee-for-service. In the first model, selected acute care hospitals provide a standard discount to Medicare from the usual Part A hospital inpatient payments. In the second model, the hospitals enter into a retrospective bundled payment arrangement where actual expenditures are reconciled against a target price for an episode of care. If the hospital spends less than the target, it gets a bonus from CMS to distribute as it sees fit. But if it spends more, it must refund CMS the difference.
A third payment model echoes the second model, but is for post-acute care provided by entities such as skilled nursing facilities, inpatient rehabilitation facilities, long-term care hospitals or home health agencies.
Only the fourth and last payment model is one where CMS provides a single bundled payment for an inpatient say related to a specific clinical condition episode. If the hospital can provide care for less than the bundled payment, it gets to keep the difference. If the episode of care costs more, the hospital absorbs the loss. Adding to the risk for the hospital, if the patient is re-admitted within 30 days of discharge, the care provided during the re-admission is also covered by the single bundled prospective payment.
Phase one of the payment model was designed to let participating hospitals safely test the bet that they could provide care for less than the bundled payment amount CMS would provide for a specific clinical condition episode of care. In phase two of the model, the financial risk becomes real. According to CMS, the 21 hospitals that last month entered phase two of this test model are as follows:
Health Care Facility | Episodes |
Arrowhead Hospital, Glendale, Ariz | Phase 1: Revision of the hip or knee Phase 2: Cardiac defibrillator; Cardiac valve; Coronary artery bypass graft; Double joint replacement of the lower extremity; Major joint replacement of the lower extremity; Pacemaker; Pacemaker device replacement or revision; Percutaneous coronary intervention |
Bronson Methodist Hospital, Kalamazoo, Mich | Phase 2: Back & neck except spinal fusion; Cervical spinal fusion; Combined anterior posterior spinal fusion; Complex non-cervical spinal fusion; Spinal fusion (non-cervical); Coronary artery bypass graft; Double joint replacement of the lower extremity; Major joint replacement of the lower extremity; Other knee procedures; Revision of the hip or knee |
Exempla Good Samaritan Medical Center, Lafayette, Colo | Phase 2: Major joint replacement of the lower extremity |
Exempla Lutheran Medical Center, Wheat Ridge, Colo | Phase 2: Major joint replacement of the lower extremity |
Exempla Saint Joseph Hospital, Denver | Phase 2: Major joint replacement of the lower extremity |
Florida Hospital, Orlando | Phase 2: Cardiac valve; Coronary artery bypass graft |
Jersey Shore University Medical Center, Neptune, NJ | Phase 2: Coronary artery bypass graft |
Lancaster General Hospital, Lancaster, Pa | Phase 1: Cardiac valve; Hip & femur procedures except major joint; Other knee procedures Phase 2: Back & neck except spinal fusion; Cardiac defibrillator; Cervical spinal fusion; Spinal fusion (non-cervical); Coronary artery bypass graft; Double joint replacement of the lower extremity; Major joint replacement of the lower extremity; Pacemaker; Percutaneous coronary intervention; Revision of the hip or knee |
Methodist Hospital of Southern California, Arcadia, Calif | Phase 1: Coronary artery bypass graft; Cardiac valve Phase 2: AICD generator or lead; Back & neck except spinal fusion; Cardiac defibrillator; Cervical spinal fusion; Combined anterior posterior spinal fusion; Complex non-cervical spinal fusion; Spinal fusion (non-cervical); Double joint replacement of the lower extremity; Major joint replacement of the lower extremity; Pacemaker; Pacemaker device replacement or revision; Percutaneous coronary intervention; Revision of the hip or knee |
Paradise Valley Hospital, Phoenix, Ariz | Phase 1: Revision of the hip or knee Phase 2: Double joint replacement of the lower extremity; Major joint replacement of the lower extremity |
Phoenix Baptist Hospital/Arizona Heart Hospital, Phoenix, Ariz | Phase 1: Revision of the hip or knee Phase 2: Cardiac defibrillator; Cardiac valve; Coronary artery bypass graft; Double joint replacement of the lower extremity; Major joint replacement of the lower extremity; Pacemaker; Pacemaker device replacement or revision; Percutaneous coronary intervention |
St. Luke's Hospital, Chesterfield, Mo | Phase 2: Back & neck except spinal fusion; Cervical spinal fusion; Spinal fusion (non-cervical) |
St. Vincent Healthcare, Billings, Mont | Phase 2: Major joint replacement of the lower extremity |
Summa Akron City and St. Thomas Hospitals, Akron, Ohio | Phase 2: Cardiac defibrillator; Cardiac valve; Coronary artery bypass graft; Pacemaker; Pacemaker device replacement or revision; Percutaneous coronary intervention |
Summa Barberton Hospital, Barberton, Ohio | Phase 2: Cardiac defibrillator; Cardiac valve; Coronary artery bypass graft; Pacemaker; Pacemaker device replacement or revision; Percutaneous coronary intervention |
Torrance Memorial Medical Center, Torrance, Calif | Phase 1: Revision of the hip or knee Phase 2: Double joint replacement of the lower extremity; Major joint replacement of the lower extremity |
University of California San Francisco Medical Center, San Francisco | Phase 2: Double joint replacement of the lower extremity; Major joint replacement of the lower extremity |
University of Colorado Hospital, Aurora, Colo | Phase 2: Congestive heart failure |
Valley Baptist Medical Center - Harlingen (VBMC-H), Harlingen, Tex | Phase 1: Cervical spinal fusion; Complex non-cervical spinal fusion; Spinal fusion (non-cervical) Phase 2: Major joint replacement of the lower extremity |
West Valley Hospital, Goodyear, Ariz | Phase 1: Revision of the hip or knee Phase 2: Cardiac defibrillator; Cardiac valve; Coronary artery bypass graft; Double joint replacement of the lower extremity; Major joint replacement of the lower extremity; Pacemaker; Pacemaker device replacement or revision; Percutaneous coronary intervention |
Source: CMS.gov
Learn more about the Bundled Payments for Care Improvement (BPCI) Initiative
Contributor
Lena Kauffman is a contributing writer based in Ann Arbor, Michigan.