Shay Jacobson, RN, MA, NMG, LNCC, CNLCP

Martha Kern


Accountable Care Organizations are not the only model Medicare is testing as a means to reduce healthcare costs and hospital readmissions.  Bundled Payments for Care Improvement (BPCI) is yet another initiative that appears to be gaining traction.  Patients may or may not have full awareness these initiatives are being carried out and that they, in fact, are unwitting participants in the pilot.  Be prepared, though, for questions from your clients/patients as they witness change in the way care is delivered.  Here are the basics on Bundled Payments:

  • Where Accountable Care Organizations bring together various healthcare providers to collaboratively deliver lower care costs for a pool of 5000+ patients, the Bundled Payment initiative offers providers a flat payment for a given episode of care.  A set price will be attached to a hip replacement, for example, and will cover only the acute phase of care or may cover a 90-day period that includes post-acute care in the community.
  • When providers succeed in delivering care below the target price for that specific episode of treatment, they keep the savings.  If they exceed the target price, the providers must pay CMS the difference.  There is a strong incentive to achieve a successful outcome within the designated time period, and to do so as inexpensively as possible.
  • The BPCI pilot includes four bundled models and 48 episodes of care for organizations to consider for implementation.  Some models cover only the acute inpatient stay; readmissions within the following 30 days for issues related to the initial episode are included in the bundled price.  Other models extend to the post-acute period and include care provided after patients leave the hospital.
  • While this payment model essentially requires that providers “gamble” on their ability to complete an episode of care for a given price, many are interested in taking this risk.  They may break even or lose money, but providers do not want to be left behind as the healthcare industry undergoes reformation, and they value opportunities to offer input and help shape the future by participating in these pilots.
  • Early data does seem to indicate that some participants are succeeding with the BPCI model (results are not public), and most seem to believe that this model will favorably impact Medicare’s bottom line more quickly than the ACO model.
  • Inherent in the program is a collaborative effort among hospitals, physicians and community-based providers.  Care coordination is emphasized, as is the prevention of hospital-acquired infections.
  • Oncology is one care area that is being watched closely.  Seventy-five to 80% of care is provided in outpatient settings, and there are 1.4 million new diagnoses each year.  It is widely believed that protocol-driven care can bring about significant savings without sacrificing favorable outcomes.
  • Post-acute care facilities (skilled nursing facilities) are seen as settings where substantial savings can be realized.  Hospitals, as participants in the bundled payment program, can benefit from savings achieved in these external settings.  It remains to be seen, however, if hospital interventions in post-acute environments create an adversarial climate as boundaries are crossed.  Skilled nursing facilities may or may not welcome input from outside entities.

The patient experience in the BPCI model is an unknown facet of the program.  There will be considerable effort expended to move them through their episodes of care as quickly and efficiently as possible, and this focus may cause a patient to feel their care is rushed or incomplete.  If, however, care is better coordinated and there is more emphasis on planning and follow-up, patients may come away with a sense that their needs are fully known and addressed throughout the episode.

We will report the results of these pilots as they become available, along with the ways in which Medicare and healthcare providers are working to improve those outcomes.

©Lifecare Innovations, Inc.