Medicare's bundled payment pilot for acute and postacute care: analysis and recommendations on where to begin.
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SUBMITTER: Sood N
PROVIDER: S-EPMC4109141 | biostudies-literature | 2011 Sep
REPOSITORIES: biostudies-literature
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Medicare's bundled payment pilot for acute and postacute care: analysis and recommendations on where to begin.
Sood Neeraj N Huckfeldt Peter J PJ Escarce José J JJ Grabowski David C DC Newhouse Joseph P JP
Health affairs (Project Hope) 20110901 9
In the National Pilot Program on Payment Bundling, a subset of Medicare providers will receive a single payment for an episode of acute care in a hospital, followed by postacute care in a skilled nursing or rehabilitation facility, the patient's home, or other appropriate setting. This article examines the promises and pitfalls of bundled payments and addresses two important design decisions for the pilot: which conditions to include, and how long an episode should be. Our analysis of Medicare d ...[more]
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Project description:STUDY DESIGN:Retrospective analysis of Medicare claims linked to hospital participation in the Center for Medicare and Medicaid Innovation's episode-based Bundled Payment for Care Improvement (BPCI) program for lumbar fusion. OBJECTIVE:To describe the early effects of BPCI participation for lumbar fusion on 90-day reimbursement, procedure volume, reoperation, and readmission. SUMMARY OF BACKGROUND DATA:Initiated on January 1, 2013, BPCI's voluntary bundle payment program provides a predetermined payment for services related to a Diagnosis-Related Group-defined "triggering event" over a defined time period. As an alternative to fee-for-service, these reforms shift the financial risk of care on to hospitals. METHODS:We identified fee-for-service beneficiaries over age 65 undergoing a lumbar fusion in 2012 or 2013, corresponding to the years before and after BPCI initiation. Hospitals were grouped based on program participation status as nonparticipants, preparatory, or risk-bearing. Generalized estimating equation models adjusting for patient age, sex, race, comorbidity, and hospital size were used to compare changes in episode costs, procedure volume, and safety indicators based on hospital BPCI participation. RESULTS:We included 89,605 beneficiaries undergoing lumbar fusion, including 36% seen by a preparatory hospital and 7% from a risk-bearing hospital. The mean age of the cohort was 73.4 years, with 59% women, 92% White, and 22% with a Charlson Comorbidity Index of 2 or more. Participant hospitals had greater procedure volume, bed size, and total discharges. Relative to nonparticipants, risk-bearing hospitals had a slightly increased fusion procedure volume from 2012 to 2013 (3.4% increase vs. 1.6% decrease, P?=?0.119), did not reduce 90-day episode of care costs (0.4% decrease vs. 2.9% decrease, P?=?0.044), increased 90-day readmission rate (+2.7% vs. -10.7%, P?=?0.043), and increased repeat surgery rates (+30.6% vs. +7.1% points, P?=?0.043). CONCLUSION:These early, unintended trends suggest an imperative for continued monitoring of BPCI in lumbar fusion. LEVEL OF EVIDENCE:3.
| S-EPMC5839918 | biostudies-literature
Project description:Policy Points Evidence suggests that bundled payment contracting can slow the growth of payer costs relative to fee-for-service contracting, although bundled payment models may not reduce absolute costs. Bundled payments may be more effective than fee-for-service payments in containing costs for certain medical conditions. For the most part, Medicare's bundled payment initiatives have not been associated with a worsening of quality in terms of readmissions, emergency department use, and mortality. Some evidence suggests a worsening of other quality measures for certain medical conditions. Bundled payment contracting involves trade-offs: Expanding a bundle's scope and duration may better contain costs, but a more comprehensive bundle may be less attractive to providers, reducing their willingness to accept it as an alternative to fee-for-service payment.ContextBundled payments have been promoted as an alternative to fee-for-service payments that can mitigate the incentives for service volume under the fee-for-service model. As Medicare has gained experience with bundled payments, it has widened their scope and increased their duration. However, there have been few reviews of the empirical literature on the impact of Medicare's bundled payment programs on cost, resource use, utilization, and quality.MethodsWe examined the history and features of 16 of Medicare's bundled payment programs involving hospital-initiated episodes of care and conducted a literature review of articles about those programs. Database and additional searches yielded 1,479 articles. We evaluate the studies' methodological quality and summarize the quantitative findings about Medicare expenditures and quality of care from 37 studies that used higher-quality research designs.FindingsMedicare's bundled payment initiatives have varied in their design features, such as episode scope and duration. Many initiatives were associated with little to no reduction in Medicare expenditures, unless large pricing discounts for providers were negotiated in advance. Initiatives that included post-acute care services were associated with lower expenditures for certain conditions. Hospitals may have been able to reduce internal production costs with help from physicians via gainsharing. Most initiatives were not associated with significant changes in quality of care, as measured by readmission and mortality rates. Of the significant changes in readmission rates, the results were mixed, showing increases and decreases associated with bundled payments. Some evidence suggested that worse patient outcomes were associated bundled payments, although most results were not statistically significant. Results on case-mix selection were mixed: Several initiatives were associated with reductions in episode severity, whereas others were associated with little change.ConclusionsBundled payments for hospital-initiated episodes may be a good alternative to fee-for-service payments. Bundled payments can help slow the growth of payer spending, although they do not necessarily reduce absolute spending. They are associated with lower provider production costs, and there is no overwhelming evidence of compromised quality. However, designing a bundled payment contract that is attractive to both providers and payers proves to be a challenge.
| S-EPMC7482383 | biostudies-literature
Project description:ObjectivesTo evaluate whether participation in Medicare's voluntary Bundled Payments for Care Improvement (BPCI) model was associated with changes in discharge referral patterns to skilled nursing facilities (SNFs), specifically number of SNF partners and discharge concentration.Study designRetrospective observational study using difference-in-differences analysis.MethodsWe used Medicare claims data from 2010 to 2015 to identify admissions for lower joint replacement surgery and the following medical conditions: congestive heart failure, renal failure, sepsis, pneumonia, urinary tract and kidney infections, chronic obstructive pulmonary disease, and stroke. We used difference-in-differences analyses to assess changes in discharge patterns among BPCI-participating hospitals compared with matched control hospitals.ResultsOur analytic sample included 3078 acute care hospitals and 14,866 Medicare-certified SNFs in the United States, encompassing more than 47 million hospital discharges. Of these hospitals, 416 participated in BPCI, with the majority selecting into joint replacement episodes (n = 295). BPCI participation was not associated with any change in number of SNF partners (increase by 0.8 SNFs among BPCI hospitals relative to non-BPCI hospitals; 95% CI, -0.2 to 1.9; P = .11) or in discharge concentration (increase in Herfindahl-Hirschman Index of 0.2 among BPCI hospitals relative to non-BPCI hospitals; 95% CI, -68.7 to 69.1; P = .36). Results did not vary across clinical conditions and were robust across duration of BPCI participation and with different comparison groups.ConclusionsHospital participation in BPCI was not associated with changes in the number of SNF partners or in discharge concentration relative to non-BPCI hospitals. More research is needed to understand how hospitals are responding to bundled payment incentives and specific practices that contribute to improvements in cost and quality.
| S-EPMC6788623 | biostudies-literature
Project description:ObjectiveTo evaluate whether participation in Medicare's Acute Care Episode (ACE) Demonstration Program-an early, small, voluntary episode-based payment program-was associated with a change in expenditures or quality of care.Data sources/study settingMedicare claims for patients who underwent cardiac or orthopedic surgery from 2007 to 2012 at ACE or control hospitals.Study designWe used a difference-in-differences approach, matching on baseline and pre-enrollment volume, risk-adjusted Medicare payments, and clinical outcomes to identify controls.Principal findingsParticipation in the ACE Demonstration was not significantly associated with 30-day Medicare payments (for orthopedic surgery: -$358 with 95 percent CI: -$894, +$178; for cardiac surgery: +$514 with 95 percent CI: -$1,517, +$2,545), or 30-day mortality (for orthopedic surgery: -0.10 with 95 percent CI: -0.50, 0.31; for cardiac surgery: -0.27 with 95 percent CI: -1.25, 0.72). Program participation was associated with a decrease in total 30-day post-acute care payments (for cardiac surgery: -$718; 95 percent CI: -$1,431, -$6; and for orthopedic surgery: -$591; 95 percent CI: $-$1,161, -$22).ConclusionsParticipation in Medicare's ACE Demonstration Program was not associated with a change in 30-day episode-based Medicare payments or 30-day mortality for cardiac or orthopedic surgery, but it was associated with lower total 30-day post-acute care payments.
| S-EPMC5867094 | biostudies-literature
Project description:ImportanceBundled payments are an increasingly common alternative payment model for Medicare, yet there is limited evidence regarding their effectiveness.ObjectiveTo report interim outcomes from the first year of implementation of a bundled payment model for lower extremity joint replacement (LEJR).Design, setting, and participantsAs part of a 5-year, mandatory-participation randomized trial by the Centers for Medicare & Medicaid Services, eligible metropolitan statistical areas (MSAs) were randomized to the Comprehensive Care for Joint Replacement (CJR) bundled payment model for LEJR episodes or to a control group. In the first performance year, hospitals received bonus payments if Medicare spending for LEJR episodes was below the target price and hospitals met quality standards. This interim analysis reports first-year data on LEJR episodes starting April 1, 2016, with data collection through December 31, 2016.ExposureRandomization of MSAs into the CJR bundled payment model group (75 assigned; 67 included) or to the control group without the CJR model (121 assigned; 121 included). Instrumental variable analysis was used to evaluate the relationship between inclusion of MSAs in the CJR model and outcomes.Main outcomes and measuresThe primary outcome was share of LEJR admissions discharged to institutional postacute care. Secondary outcomes included the number of days in institutional postacute care, discharges to other locations, Medicare spending during the episode (overall and for institutional postacute care), net Medicare spending during the episode, LEJR patient volume and patient case mix, and quality-of-care measures.ResultsAmong the 196 MSAs and 1633 hospitals, 131 285 eligible LEJR procedures were performed during the study period (mean volume, 110 LEJR episodes per hospital) among 130 343 patients (mean age, 72.5 [SD, 0.91] years; 65% women; 90% white). The mean percentage of LEJR admissions discharged to institutional postacute care was 33.7% (SD, 11.2%) in the control group and was 2.9 percentage points lower (95% CI, -4.95 to -0.90 percentage points) in the CJR group. Mean Medicare spending for institutional postacute care per LEJR episode was $3871 (SD, $1394) in the control group and was $307 lower (95% CI, -$587 to -$27) in the CJR group. Mean overall Medicare spending per LEJR episode was $22 872 (SD, $3619) in the control group and was $453 lower (95% CI, -$909 to $3) in the CJR group, a statistically nonsignificant difference. None of the other secondary outcomes differed significantly between groups.Conclusions and relevanceIn this interim analysis of the first year of the CJR bundled payment model for LEJR among Medicare beneficiaries, MSAs covered by CJR, compared with those that were not, had a significantly lower percentage of discharges to institutional postacute care but no significant difference in total Medicare spending per LEJR episode. Further evaluation is needed as the program is more fully implemented.Trial registrationClinicalTrials.gov Identifier: NCT03407885; American Economic Association Registry Identifier: AEARCTR-0002521.
| S-EPMC6142993 | biostudies-literature
Project description:ObjectivesEvaluate the cost of illness associated with the 90-day period following acute myocardial infarction (AMI) and the implication of care pathway (percutaneous coronary intervention [PCI] vs medical management [MM]), in order to assess the potential financial risk incurred by providers for AMI as an episode of care.PerspectiveReimbursement payment systems for acute care episodes are shifting from 30-day to 90-day bundled payment models. Since follow-up care and readmissions beyond the early days/weeks post-AMI are common, financial risk may be transferred to providers.SettingAMI hospitalization Centers for Medicare & Medicaid Services (CMS) standard analytical files between 10/1/2015 and 9/30/2016 were reviewed.MethodsIncluded patients were Medicare beneficiaries with a primary diagnosis of AMI subsequently treated with either PCI or MM. Payments were standardized to remove geographic variation and separated into reimbursements for services during the hospitalization and from discharge to 90 days post-discharge. Results were stratified by Medicare Severity Diagnosis Related Groups (MS-DRGs) individually and grouped between patients treated with MM and PCI. Risk-adjusted likelihood of utilization of post-acute nursing care and all-cause readmission was assessed by logistic regression.ResultsA total of 96,546 patients were included in the analysis. The highest total mean payment (US$32,714) was for MS-DRG 248 (PCI with non-drug-eluting stent with major complication or comorbidity). Total payments were similar between MM and PCI patients, but MM patients incurred the majority of costs in the post-acute period after discharge, with the converse true for PCI patients. MM without catheterization was associated with a twofold increase in risk of requiring post-acute nursing care and 90-day readmission versus PCI (odds ratio [95% confidence interval]: 2.01 [1.92-2.11] and 2.17 [2.08-2.27]). Smaller hospital size, diabetes, peripheral arterial disease, prior AMI, and multivessel disease were predictors of higher healthcare utilization.ConclusionsMS-DRGs associated with the lowest reimbursements (and presumably, lowest costs of inpatient care) incur the highest post-discharge expenditures. As the CMS Bundled Payment for Care Improvement and similar programs are implemented, there will be a need to account for heterogeneous post-discharge care costs. Video abstract (MP4 274659 KB).
| S-EPMC9596673 | biostudies-literature
Project description:ObjectiveTo measure variation in payment rates under Medicare's Inpatient Prospective Payment System (IPPS) and identify the main payment adjustments that drive variation.Data sources/study settingMedicare cost reports for all Medicare-certified hospitals, 1987-2013, and Dartmouth Atlas geographic files.Study designWe measure the Medicare payment rate as a hospital's total acute inpatient Medicare Part A payment, divided by the standard IPPS payment for its geographic area. We assess variation using several measures, both within local markets and nationally. We perform a factor decomposition to identify the share of variation attributable to specific adjustments. We also describe the characteristics of hospitals receiving different payment rates and evaluate changes in the magnitude of the main adjustments over time.Data collection/extraction methodsData downloaded from the Centers for Medicare and Medicaid Services, the National Bureau of Economic Research, and the Dartmouth Atlas.Principal findingsIn 2013, Medicare paid for acute inpatient discharges at a rate 31 percent above the IPPS base. For the top 10 percent of discharges, the mean rate was double the IPPS base. Variations were driven by adjustments for medical education and care to low-income populations. The magnitude of variation has increased over time.ConclusionsAdjustments are a large and growing share of Medicare hospital payments, and they create significant variation in payment rates.
| S-EPMC5346495 | biostudies-literature
Project description:To determine whether bundled payment could be an effective payment model for California, the Integrated Healthcare Association convened a group of stakeholders (health plans, hospitals, ambulatory surgery centers, physician organizations, and vendors) to develop, through a consensus process, the methods and means of implementing bundled payment. In spite of a high level of enthusiasm and effort, the pilot did not succeed in its goal to implement bundled payment for orthopedic procedures across multiple payers and hospital-physician partners. An evaluation of the pilot documented a number of barriers, such as administrative burden, state regulatory uncertainty, and disagreements about bundle definition and assumption of risk. Ultimately, few contracts were signed, which resulted in insufficient volume to test hypotheses about the impact of bundled payment on quality and costs. Although bundled payment failed to gain a foothold in California, the evaluation provides lessons for future bundled payment initiatives.
| S-EPMC8575503 | biostudies-literature
Project description:To evaluate whether Medicare-style bundled payments are lower or higher for beneficiaries discharged from hospitals with postacute care (PAC) referrals concentrated among fewer PAC providers.Medicare Part A and Part B claim (2008-2012) for all beneficiaries residing in any of 17 market areas: the Provider of Service file, the Healthcare Cost Report Information System, and the Dartmouth Atlas.An observational study in which hospitals were distinguished according to PAC referral concentration, which is the tendency to utilize fewer rather than more PAC providers. We tested the hypothesis that higher referral concentration would be associated with total Medicare bundled payments.The data represent a convenience sample of market areas that were defined by the locations of grantees from the ONC Beacon Community Program.The four most-used PAC providers accounted for an average of 60 percent of patients discharged from hospitals in the sample. Regression analysis suggested that higher referral concentration was associated with lower Medicare costs per bundle.Hospitals that tend to use fewer PAC providers may lead to lower costs for payers such as Medicare. The study results reinforce the importance of limited networks for PAC services under bundling arrangements for hospital and PAC payments.
| S-EPMC5682136 | biostudies-literature
Project description:ObjectiveTo examine changes in postacute care (PAC) use during the initial Medicare payment reforms enacted by the Balanced Budget Act of 1997.Data sourcesWe used claims data from the 5 percent Medicare beneficiary sample in 1996, 1998, and 2000. Linked data from the Denominator file, Provider of Service file, and Area Resource File provided additional patient, hospital, and market-area characteristics.Study designSix disease groups with high PAC use were selected for analysis. We used multinomial logit regression to examine how PAC use differed by year of service, controlling for patient, hospital, and market-area characteristics.Principal findingsThere were major changes in PAC use, and a portion of services shifted to settings where reimbursement remained cost-based. During the first reform, the home health agency interim payment system, home health use decreased consistently across disease groups. This decrease was accompanied by increased use in skilled nursing facilities (SNFs). Following the implementation of the prospective payment system for SNFs, the use of inpatient rehabilitation facilities increased.ConclusionsThe shift in usage among settings occurred in two stages that corresponded to the timing of payment reforms for home health agencies and SNFs. Evidence strongly suggests the substitutability between PAC settings. Financial incentives, in addition to clinical needs and individual preferences, play a major role in PAC use.
| S-EPMC1797075 | biostudies-literature