An amended version of BPCI is considered the most likely voluntary bundled payment model to emerge in 2018.

March 2—Medicare announced plans in 2016 for at least one new voluntary bundled payment program to launch in 2018. But following the election of President Donald Trump, uncertainty abounds.

Healthcare providers have been watching for signs regarding new voluntary payment bundles ever since October 2016, when the Centers for Medicare & Medicaid Services (CMS) issued a final rule to implement the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). The rule stated that new advanced alternative payment models (APMs) were expected to launch by 2018 and would include a new voluntary bundled payment model.

But some analysts have raised questions about whether the new voluntary model will launch amid ambivalence about CMS-led payment models among Trump’s senior healthcare leadership.

“Obviously we have a new administration, so that’s now up in the air,” said Danielle Lloyd, vice president of policy and advocacy for Premier, a hospital quality improvement company. “But our hope and understanding is that they are continuing to work on a new program.”

Leadership Challenges

Healthcare industry confusion stemmed in part from the stated positions of Tom Price, who recently  was confirmed as secretary of the U.S. Department of Health and Human Services. Price underscored during his January confirmation hearing that he remained opposed to mandatory CMS payment models. For instance, Price said the Comprehensive Care for Joint Replacement (CJR) model would “potentially” cut Medicare enrollees’ promised benefits.

Price also continued his criticism of the Center for Medicare & Medicaid Innovation (CMMI), which was created by the ACA to test new payment models and authorized by MACRA to create APMs. CMMI “has gotten off track a bit,” Price said.

“From the provider community perspective, we would prefer voluntary models, and Secretary Price has suggested that as well,” Lloyd said. “But we do want to make sure that there is a role for health systems in whatever different iteration may come.”

The new models also could be impacted by the lack of permanent CMS leadership. Seema Verma’s nomination to serve as administrator of CMS received Senate Finance Committee approval on March 2, but full Senate approval awaits. Her leadership team, including the head of CMMI, has yet to be installed.

“There has been some turnover there, so they’re going to have to staff up and there may be some delays,” David P. Terry, CEO of Archway Health Advisors, said in an interview. “There may be some slippage in the timing, but we expect it to happen at some point in 2018.”

Deirdre Baggot, PhD, a former CMS expert reviewer on BPCI and a principal at ECG, said she expects delays similar to those that occurred during the rollout of the Acute Care Episode program in 2008, which marked the previous turnover in administrations.

“Getting Price into place and a few other key positions into place will enable us to move forward,” Baggot said. “But I’ve experienced that before, and it doesn’t give me any cause for concern.”

Which Models?

With BPCI scheduled to end in September 2018, a successor model is seen by some as the most likely voluntary model for CMS to launch in 2018 because BPCI has accumulated a growing amount of data and achieved some positive results. For instance, a study published in the February issue of JAMA Internal Medicine found that among nearly 4,000 BPCI joint replacement patients, Medicare saved an average of 21 percent in uncomplicated joint replacement cases and 14 percent in complicated cases.

But the program’s future could be forged in give-and-take between participating orthopedic surgeons and Price, who has practiced in the same subspecialty.

“This has been a very good program for them and for Medicare, and we’ve heard recently that Secretary Price is hearing this from his colleagues,” Terry said.

The approach to the new version of BPCI could be similar to the manner in which CMS closely modeled the Next Generation Accountable Care Organization (ACO) model on the earlier Pioneer ACO program.

“You’re changing aspects of it, but the fundamental concern is the same; that’s basically what we would expect from a BPCI 1.0 to a 2.0,” Lloyd said.

Expected BPCI changes could include aspects of the CJR and Advancing Care Coordination Through Episode Payment Models (EPMs) and include additional legal waivers that aim to ease the coordination of care among providers, as well as a shift to regional blended payments—both changes sought by providers. Premier included its preferred voluntary bundled model approaches in a Feb. 28 letter to CMS.

The Pacific Business Group on Health (PBGH) is among the stakeholders hoping the new models will focus less on treatment episodes and more on chronic health conditions.

“We recognize, however, that is complicated and requires quite a bit of work,” Bill Kramer, executive director for national health policy at PBGH, said in an interview.

Terry said specialists are expecting the new voluntary models to include more opportunities for them—instead of hospitals—to initiate episodes of care.

“We see the most and quickest impact when physicians are really engaged,” Terry said. “And hospitals make that harder.”

Premier also is formulating a proposal for CMS to test a “layered model” that includes primary care capitation, bundled payment for inpatient and outpatient services, and an annual per capita budget in which to reconcile it all.

“Each of those layers have a different function, but by testing them together where the providers have to come in on a voluntary basis to take on this responsibility together, we think that is going to result in higher-quality care and lower-cost care,” Lloyd said

The new voluntary models could be based on models that are currently mandatory, with the Trump administration making participation optional, according to industry advisers. The most likely candidate for that switch is the EPM model, which is scheduled to launch in July even though activation of the final rule recently was delayed from Feb. 18 to March 21 as part of a government-wide regulatory freeze. The short delay is not seen as having a lasting impact—unless the Trump administration uses it to create further delays or institute major changes.

“It’s a question mark as to what will happen with that program,” Lloyd said.

Baggot does not foresee any changes to the new mandatory models, including an expansion of CJR to incorporate additional procedures.

“I suspect both EPM and CJR will proceed as written and planned,” Baggot said. “The real question is going forward as new models are recommended and put forth, I suspect they will be more voluntary in nature than mandated.”

Other possibilities for 2018 voluntary models could come from the Physician-Focused Payment Model Technical Advisory Committee (PTAC), which was created by MACRA to design APMs. PTAC began accepting proposals for physician-focused payment models on Dec. 1, 2016, with ideas thus far including a model focused on COPD and asthma care.

Private Payers

Bundled payments have spread slowly among health plans. For instance, a 2016 McKesson report found bundled payments account for 11 percent of medical payments, but only half of payers and 40 percent of providers said they were ready to implement bundles.

But the surge in CMS activity in bundled payments and the increasing amounts of data on their results have greatly increased interest in the models in recent months among health plans and self-insured employers, according to advisers.

“The fact that CMS is showing results and continues to move it forward is indicating to the market that it is real,” Terry said. “They wouldn’t push it forward if they weren’t seeing some success.”

Kramer agreed that health plans see bundles increasingly favorably but said CMS needs to better align with the private sector on their design and implementation.

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

Publication Date: Thursday, March 02, 2017