The Medicare program delayed again its mandatory bundled payment models. This announcement, however, does not change CMS's commitment to the Bundled Payments Care Improvement (BPCI) initiative and its successor model in 2018. Specifically, CMS delayed by three months the effective dates of both the mandatory cardiac EPM programs and the expansion of the CJR model. CMS requests comment on delaying until January 2018 these effective dates.
How ‘Home-to-Home Time’ Supports the Goals of Bundled Payments
Addressing the tendency of fee-for-service to promote more spending requires changing the metrics that motivate clinician behavior away from volume as a primary focus. The DRG system, an early example of bundled payment, represents an attempt to solve the problem by paying hospitals a set amount for each hospitalization. DRG-based reimbursement incentivizes hospitals to keep costs down by eliminating unnecessary services and by shortening length of stay (LOS). Indeed, in the 30 years following the introduction of the DRG system, average hospital LOS nearly halved, dropping from 10.0 days in 1983 to 5.1 days in 20131,2.
This fix may have had unintended consequences. After adjusting their practices to discharge patients home as soon as it was safe to do so, some hospitals went a step further by transitioning sicker patients to SNFs rather than keeping those patients in-house until they could safely go home. Over the last three decades, the proportion of Medicare patients leaving a hospital who were discharged to a SNF quadrupled from 5% to 20%3,4. This shifting of days from the acute to the post-acute facility setting has several negative consequences: it adds an extra transition, increases the overall time that patients spend in facilities, and increases the cost to Medicare since SNFs are reimbursed by the day whereas hospitals are paid a lump sum for the patient stay. This last point is likely part of the reason that Medicare’s spending per hospital admission on combined inpatient and post-acute facility stays increased by nearly 10% from 2004 to 20115.
Remedy in the News
Remedy continues to be a strong advocate for the BPCI program and using bundled payment models as a path to healthcare transformation.>
CMS proposes changes to CJR: 6 key thoughts on what this means for orthopedic bundled payments
Becker's Spine Review | August 18, 2017
Is HHS’ Proposal to Scale Back Mandatory Bundled Payments a Step Back from Value-Based Care? Many Healthcare Experts Say No
Healthcare Informatics | August 18, 2017
Chris Garcia Named CEO of Remedy Partners
Remedy Partners, the nation’s leading bundled payment company, has named Chris Garcia its chief executive officer, effective July 12, 2017. Remedy is well-positioned for accelerated growth as the healthcare industry continues to adopt bundled payments as a core value-based payment strategy.
The Society of Hospital Medicine recognizes 2016 as the Year of the Hospitalist, commemorating 20 years since the term hospitalist was coined and the Society of Hospital Medicine was formed. Bob Wachter and Lee Goldman sparked the latent hospitalist movement with an article titled ‘The emerging role of ‘hospitalists’ in the American Healthcare System’ in an August 1996 issue of The New England Journal of Medicine. Several weeks later, John Nelson and I, both practicing hospitalists, formed the Society of Hospital Medicine (then incorporated in 1997).
Bundled payment programs require effective care coordination encompassing the hospitalization and the post-discharge recovery period. Within this care coordination process, selecting the ‘next site of care’ after hospital discharge is a crucial element in the provision of high value patient care. Why? When looking at large data sets representing aggregate spending, the cost of post-acute care can rival that of the initial inpatient stay.(1) For many bundles, total 90-day episode spending for a patient discharged to a skilled nursing facility can be more than two times that of a patient discharged to home.(2)
Why CMS is Focusing on Post Acute Care
Healthcare is increasingly transitioning to value based payment models in an effort to control spending and improve quality. In 2014, the amount spent on healthcare in the U.S. per individual reached $9,523—more than twice the average of all other developed countries—and is projected to reach $14,103 by 2021 if unchecked. Total healthcare spending represents almost 18% of GDP, and is expected to grow to 20% in the next five years. Furthermore, Medicare alone represented 20% of National Healthcare Expenditures
in 2013, and is expected to increase significantly after 2015 due to growing utilization of medications and services by an aging population.
To be successful in this program, you will need to optimize your day-to-day workflow, ensuring that your patients receive better care at a lower cost. We at Remedy Partners believe that there are 6 Steps to Success.
My pager interrupts a conversation with a patient’s caregiver. It’s an outside pharmacy, the message reads, “Mr. Smith needs a refill on his diuretic, please call xxx.” I pause, Mr. Smith, who was he? I recall he was discharged 4 weeks ago! He was pretty ill when he presented to the hospital with heart failure, but he pulled through after a few tough days. We managed to discharge him home with prescriptions for a month and asked that he follow up with his PCP within 7 days. So, what happened? Did he not see his doctor? I hope he’s not getting worse and about to be readmitted. I promptly investigated and discovered that the earliest appointment with his PCP was 6 weeks after discharge.