Episodes of care costs to be reduced under BPCI

CMS recently developed the Bundled Payments for Care Improvement initiative which would allow hospitals, physicians and other health care centers to enter payment arrangements — including financial and performance-based accountability models — for episodes of care in an effort to reduce health care costs.

“The goal of the [Bundled Payments for Care Improvement] BPCI program is to align payment incentives among the various providers who take care of the patient during an episode of care to enhance the health care outcomes and experience of the Medicare beneficiary, and to do this through a specified period of time that is intended to coincide with all of the elements of care required to treat medical conditions,” Mark I. Froimson, MD, MBA, told Orthopedics Today.

Through the voluntary BPCI program, CMS is working to replace the current fee-for-service (FFS) system with a bundled payment model. In this model, CMS provides a prospectively determined bundled payment to the hospital, which covers services provided by the center, its physicians and practitioners during a patient’s episode of care. If spending is kept under the amount provided by CMS, the hospital and its physicians can keep the difference and participate in gainsharing. However, if spending is above the amount provided, the hospital must provide CMS with the additional amount.

“Bundled payment models issue a single payment to providers for an entire episode of care and hold that same group of providers accountable for cost, quality and patient outcomes of that episode,” a CMS official told Orthopedics Today. “Bundled payments incentivize providers to better coordinate care, improve quality and consider financial implications in their decision-making.” (Editor’s Note: Orthopedics Today conducted an interview with a CMS official, who requested to only be identified as an employee of CMS rather than by name in the article, as is CMS’ regular practice with media outlets.)

Click here to read the full Cover Story in the October issue of Orthopedics Today.