The first year or so of CMS' voluntary Bundled Payments for Care Improvement initiative has yielded a mixed bag of results, according to the program's evaluation report.
“There have been modest reductions in Medicare episode payments for select clinical episode groups with isolated instances of quality declines and fewer instances of increased quality,” the CMS report released Monday said. The 256-page evaluation (PDF) analyzed 15 clinical episode groups; it found 11 had potential to save Medicare money.
Hospitals that opted to participate in CMS' bundled-payment programs spent less money and take better care of orthopedic surgery patients, cutting costs by $864, or 3% per episode. These patients also reported greater improvements in mobility after 90 days as compared to patients at other hospitals.
In cardiovascular surgery, however, hospitals in one model did not save money in the initiative and quality of care remained the same.
Meanwhile, Medicare payments for spinal surgery episodes increased under the initiative, but mortality declined. “These results warrant further investigation,” the report said.
In a blog post, CMS acting Principal Deputy Administrator and Chief Medical Officer Dr. Patrick Conway called these early findings “encouraging,” touting the progress seen in orthopedic surgery bundles. But it would take more data to fully determine the initiative's impact on costs and quality, he added.
“Future evaluation reports will have greater ability to detect changes in payment and quality due to larger sample sizes and the recent growth in participation of the initiative, which generally is not reflected in this report,” Conway wrote.
The report, an observational study, warned against jumping to conclusions about the overall impact of the initiative and of bundled payments in general, for several reasons. One was the voluntary nature of the initiative, with the providers and organizations that opted in tending to be larger, urban facilities with higher-income populations.
The study also reflected, at most, the experiences of the first 15 months of BPCI's early participants. And it contained results from three of the initiative's four models. Most results drew on the experiences of 94 awardees and 58,410 episodes of care during the initiative's first year.
“Limited sample sizes, in particular, have affected our ability to understand the differential impact of BPCI across types of participants, health care delivery, and the Medicare program,” the report said. “Therefore, more study is needed before generalizing these results to other providers or the full range of clinical episodes.”
The Bundled Payments for Care Improvement initiative began in 2013. It is one of many initiatives aimed at moving healthcare into a payment system based on value instead of volume. By 2018, the administration wants to see half of traditional Medicare payments going through alternative payment models.
Bundled payments is one of them. Although implementation varies, the fundamental concept is that providers are paid a set amount per patient for a single episode of care, such as a hip replacement, rather than paying for individual services rendered as part of that care. It puts providers at financial risk and is supposed to force them to think more carefully about and better coordinate care.
The model is increasingly popular—the CMS also has a mandatory bundled-payment program for hip and knee replacements that launched in January, which it has proposed to expand to bypass surgery and heart attacks—but how consistent and effective it is in lowering costs and improving quality of care remains to be seen.
At last count, in July, the Bundled Payments for Care Improvement initiative had 1,448 participants, including 360 acute-care hospitals, 658 skilled-nursing facilities and 262 physician group practices, with home health agencies and inpatient rehabilitation facilities making up the rest.
