CMS recently announced new proposals to expand its bundled payment model in association with the development of Alternative Payment Models. According to the proposal, 98 metropolitan areas selected by CMS will be subjected to a new bundled payment method for heart attack and bypass surgery. Comprehensive Joint Replacement (CJR) bundled payment model will also be expanded to include surgical treatment for femur and hip fractures, in addition to knee and hip replacement.
The proposed changes will take effect by July 1, 2017. The reimbursement for bundled payment for cardiac care will include all the in-patient care as well as 90-day care after discharge from the hospital.
The proposed bundled payment model is still in papers stage, and physicians are paid by the old methods in the participating hospitals at present. However, at the end of the performance year, these regular payments will be adjusted to the upfront payment level of bundled payment model.
Hospitals and physicians will be paid by the regular method of Medicare fee-for-service (FFS) system during the performance year, and at the end of the year, CMS will spot the period of care, services provided, and the cost incurred. The actual cost will then be compared with the payment according to the bundled payment model.
If the result showed that the hospitals were underpaid by FFS as compared to the payment by bundled payment model, then the difference amount will be reimbursed by CMS. Moreover, if the hospitals are overpaid, then they would have to reimburse a percentage of the difference to CMS.
CMS is also encouraging hospitals to coordinate with other health professionals like skilled physicians and nursing facilities by financial adjustments. This will allow the participants to share their repayments with other providers.
The agency further plans to test a new model to promote the use of cardiac rehabilitation services. The model tests the result of granting an incentive to hospitals based on the patients under the 90-day cardiac rehabilitation services after discharge. The incentives would be used by the hospitals to coordinate the rehabilitation services. Throughout the model, standard Medicare payment for the cardiac rehabilitation services will be paid directly to the providers.
CMS expects that over five performance years of the new models, these changes will result in around $170 million savings to Medicare. The agency will also incorporate tracks within the current CJR model and the new cardiac bundled model to get them qualified as Advanced Alternative Payment Models for MACRA payments.