Many providers are expected to apply to participate in the voluntary initiative, despite the risk of losing Medicare funding if spending goals are not met, because they also may qualify for additional funding, according to CMS officials.
“Several of the models include services that typically hospitals are not being reimbursed for today,” Dr. Richard Gilfillan, acting director of the CMS Innovation Center, said in a Tuesday call with reporters.
Three of the four models in the initiative will use a retrospective bundled payment arrangement under which the CMS and providers set a target payment amount for a defined episode of care. That total target payment, based on a discounted version of the Medicare fee system, will be compared with the total payments at the end of the episode of care and providers will receive a share of any resulting savings.
Another model would pay providers prospectively and allow them to choose the model of bundled payments that works best for them.
Interested providers must submit so-called letters of intent before either Sept. 22 or Nov. 4, depending on the specific model they plan to pursue, to meet the 2012 “rolling” launch.