Possible additional changes to the mandatory programs this summer worry advisers, but some tweaks could improve the programs.


May 23—Medicare pilots expanding existing mandatory bundled payments and creating new bundles were pushed back to Jan. 1, 2018—longer than previously proposed by the Trump administration.

The Centers for Medicare & Medicaid Services (CMS) recently issued a rule delaying the start of an expansion of the Comprehensive Care for Joint Replacement (CJR) model; a new bundled payment program for heart attack and cardiac bypass surgery services; and a new cardiac rehabilitation incentive program (the last two groups are collectively known as episode payment models, or EPMs). The administration had previously suggested delaying those programs from July to Oct. 1, 2017.

The delay to January 2018 will allow the EPM pilot years to span a full year from the beginning, instead of the partial-year start originally envisioned. The delay also gives CMS time to issue additional rules “if modifications are warranted,” agency officials wrote.

“There was a lot of expectation in the industry that it would be delayed,” said Clay Richards, CEO of naviHealth.

The January start date for the EPM models was urged by most hospital advocacy groups and individual health systems in letters to CMS. Hospital groups were more divided on the CJR expansion, with some urging implementation on July 1, 2017, and others urging CMS to scrap the expansion.

“We disagree with commenters who were opposed to further delaying the models until January 1, 2018 on the basis that a delay would penalize those participants who may be ready for an October 1, 2017 implementation date,” CMS officials wrote in the final rule.

CMS also rejected calls to withdraw the new bundled payment models or delay them indefinitely.

Instead, CMS officials wrote that “these models will further our goals of improving the efficiency and quality of care for Medicare beneficiaries receiving care for these common clinical conditions and procedures.”

That sentiment was seen as a strong endorsement of bundled payments by the administration, which some had worried would back away from payment transformation.

 “It was a real positive, strong statement from the new administration around their belief in value-based care,” Richards said in an interview.

However, the agency did not provide a definitive response to requests that the pilots be made voluntary.

“We will not respond to these comments in this final rule as they are out of scope of this rulemaking, but we may take them into consideration in future rulemaking,” CMS officials wrote.

The comments were carefully parsed by industry watchers because they followed negative comments by Tom Price, MD, secretary of the U.S. Department of Health and Human Services, in 2016 about mandatory models.

“It seems that they are still contemplating that,” said Carolyn Magill, CEO of Remedy Partners, about whether to make the pilots voluntary. “If they wanted to end the program, they could have just said they were ending the program, and they opted not to do that. That’s a recognition that bundled payments are effective and that it is an important mechanism in the transition to value-based care.”

A change to a voluntary program would probably come with other programmatic changes, said Darcie Hurteau, director of DataGen. Those could include expanding to other DRGs or a change in target episodes or risk structures, which would take time for providers to evaluate before deciding to enter the program. 

François de Brantes, vice president and director of the Center for Payment Innovation at Altarum, opposed the mandatory design of the bundled payment pilots and pushed back on a recent call by Brookings Institution scholars for the administration to also make mandatory the much larger Bundled Payment for Care Improvement (BPCI) initiative, a precursor to CJR.

CMS is expected to announce details later this year on an extension of the voluntary BPCI model, which directs $10 billion in annual spending, compared to about $2.5 billion in CJR.

MACRA Effects

Some provisions of the rule went into effect on May 20. For instance, a provision allowing hospitals in the CJR pilot to qualify as part of an advanced alternative payment model (APM) under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) will allow participating physicians to garner 5 percent bonuses in 2019 for 2017 performance.

However, other changes in the types of CJR collaborators, including a change that permits accountable care organizations to be designated as CJR collaborators, will not become effective until Jan. 1.

Additionally, the delay in the expansion of CJR could prevent some orthopedic surgeons from qualifying to participate in an APM this year, thus causing them to miss out on bonuses when they are paid in 2019.

More Delays?

Industry watchers said they hoped more delays in the mandatory models were not coming.

“Further delays can be unnerving to providers, especially for those we’re talking to now who are preparing to enter the program,” Hurteau said. “All the false starts will be frustrating and demoralizing to providers who are engaged in practice transformation and want to ultimately participate in bundled programs. 

de Brantes said more “delays for the sake of delays” will send a bad signal to the market.

“If the delays are used to make improvements to the program, then it’s a very positive signal,” de Brantes said.

He urged CMS to use the latest delay to enact needed fixes in its bundled payment programs, such as moving away from hospital-centric model designs and adding a patient-severity adjustment.

Preparation Needed

The latest delay also could give providers more time to prepare, organize, and evaluate data if they have access to it, according to Hurteau. Her organization advises some CJR hospitals, and their results since that program began in April 2016 reflect performance improvements stemming from experience.

“Again, having more time to coordinate strategies is a good thing,” Hurteau said. 

Preparation by hospitals that are required to participate in the new bundles should include obtaining technology that allows them to track an episode in real time and provide real-time decision-making support, Magill said.

“We want physicians, nurse, and discharge planners to ask questions about whether someone has a caregiver at home, and understand whether they have stairs to navigate or whether they have access to transportation to get to their appointment,” Magill said. “Those are all things that help determine what setting is appropriate for a person.”

Another critical preparation step is building relationships with the “right” post-acute care providers.

“It’s truly time to identify those that are high-quality and adept at specific types of support, depending on a person’s diagnosis and the kind of procedure that they just experienced,” Magill said.

Among the EPM preparation recommended by Deirdre Baggot, PhD, principal at ECG, is to focus on 90-day readmissions for acute myocardial infarction (AMI), which represents significant risk for hospitals and physicians who largely have been focused on 30-day readmissions.

“AMI is a challenging population and 90-day readmission rates in some regions of the country hover around 40 percent,” said Baggot, a former CMS expert reviewer for BPCI.

Hurteau said providers interested in beginning early reviews of their data on bundled-payment patients may need to obtain baseline data through a vendor because CMS doesn’t provide it until about a month before the program starts.


Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare

Publication Date: Tuesday, May 23, 2017