Health care financing experts expect Health and Human Services Secretary (HHS) Alex Azar to follow through to introduce a new mandatory bundled payment model for radiation oncology. The announcement was something of a surprise since the previous Trump administration HHS secretary, Tom Price, had cancelled three planned mandatory payment models for treating heart attacks, bypass surgery and hip and femur fractures.
“Real experimentation with episodic bundles requires a willingness to try mandatory models,” said Azar at the conference. “…these are the most effective way to know whether these bundles can successfully save money and improve quality.”
The American Society for Radiation Oncology raised concerns about a mandatory payment bundle within hours of Azar’s speech. In a statement the society’s CEO Laura Thevenot said the society looked forward to working with CMS (the Centers for Medicare and Medicaid Services) on a payment model but pointed out that they had been working on a viable payment model with the agency for years ”that would stabilize payments, drive adherence to nationally-recognized clinical guidelines and improve patient care.” Added Thevenot, “any radiation oncology payment model will represent a significant departure from the status quo…we have concerns about the possibility of launching a model that requires mandatory participation from all radiation oncology practices at the outset.”
But experts in health care financing think that both voluntary and mandatory models need to be utilized. Joshua Liao, MD, M.Sc., the associate medical director of Contracting and Value-Based Care at the University of Washington, says there is not yet much data on mandatory programs, though he was a co-author on a journal articlein JAMA Internal Medicine in 2017 on a then voluntary payment model. The study looked at hip and knee joint replacement surgery at one five hospital health system in San Antonio between 2008 and 2015. Over the seven-year period the health system saw savings of about twenty percent on over 3,000 patients by generally using the same implant, and negotiating that cost with vendors, and by sending many patients home to recover, if appropriate, rather than sending them to rehabilitation facilities. Since April 2016, CMS has mandated a bundled payments system for knee and hip replacementsin 800 hospitals across the US.
“To accelerate the value-based transformation of America’s healthcare system, we must offer a range of new payment models so providers can choose the approach that works best for them,” said CMS Administrator Seema Verma in an agency statement in October. Verma added that CMS looks “forward to launching additional models that will provide an off-ramp to the inefficient fee-for-service system and improve quality and reduce costs for our beneficiaries.”
New voluntary models are underway. CMS reported in October that nearly 1,300 health care providers—including Adventist Health, Dignity Health, Geisinger Health System and Sutter Health—will be participating in a new volunteer payment model, announced by CMS last January. The new model, called the Bundled Payment for Care Improvement (BPCI) Advancedincludes 832 acute care hospitals and 715 group practices across the country.
The program began on Oct. 1 and runs through Dec. 31, 2023. (The original version of BPCI concluded in September 2018.) BPCI Advanced includes bundled payments for new episodes of care such as outpatient services. CMS plans to release target prices for episodes of care before each year of the program. BPCI Advanced includes a total of 32 episodes of care—3 outpatient and 29 inpatient.
According to CMS the top three clinical episodes selected by participants are knee replacement, congestive heart failure, and sepsis.
Health care providers and health systems will get another shot at BPCI Advanced in the spring of 2019 when they can sign up for the Model Year that begins January 1, 2020.
For more information sign onto the CMS BPCI Advanced Listserv.
