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Voluntary participation in bundled payments will continue after CMS cancels mandatory initiatives, experts say

Providers await new voluntary models expected to soon be released.

Susan Morse, Senior Editor

Hospitals will carry on with voluntary bundled payment models in the wake of the Centers for Medicare and Medicaid Services cancelling and scaling back on mandatory initiatives, according to experts interviewed.

Those interviewed believe the switch from mandatory to voluntary bundles is positive for providers and will not affect participation or the movement to value-based care.

"Yes, there was a segment of the industry that had invested resources into mandatory models," said Brian Fuller, vice president of value-based care for naviHealth of Tennessee. NaviHealth has over 1,000 hospital clients. "The form their participation takes, changes. We believe that's a positive for them. They can choose what their participation looks like in the next voluntary program. It creates a blank sheet of paper."

Fuller said the expectation is for CMS to announce a new voluntary bundled program very soon, as early as this week or next.

The current Bundled Payments for Care Improvement Initiative, or BPCI, is scheduled to end Sept. 30, 2018. CMS won't want to disrupt their programs by waiting much longer to unveil a new model, he said.

"There's lots of systems ready to enter next program," Fuller said. "In a lot of ways, it's business as usual."

CMS on Tuesday released a proposed rule to cancel the episode payment models and the cardiac rehabilitation incentive payment model, which were scheduled to begin on January 1, 2018.

[Also: CMS cancels mandatory episode payment models, cuts participation in joint replacement model]

CMS is also reducing the number of mandatory geographic areas participating in the comprehensive care for joint replacement model, from 67 to 34. Participants from the 33 remaining areas may take part on a voluntary basis.

The current Bundled Payments for Care Improvement Initiative allows providers to take part in bundled payments from a list of 48 clinical conditions. The highest cost conditions are those that were part of the mandatory initiative for joint replacement, hip fractures and cardiac care.

The new voluntary model is sure to include these high-cost conditions, Fuller said.

Hospitals are ready, Fuller said. Value-based care used to be a term discussed at conferences. Now it's part of healthy systems which have learned how to successfully severity adjust, account for outliers, and other factors.

"It's the right thing to do, it's incredibly complex," Fuller said.

"We're not surprised that the mandatory bundles have fallen by the wayside," said Chris Garcia, CEO of Remedy Partners in Connecticut. Secretary Price (Health and Human Services Secretary Tom Price) has made it consistently clear he opposed to mandatory bundles. Moving back to voluntary programs, and offering voluntary participation, that is the way to create systematic change. If you force somebody into it, they will look for solution to get them off the hook."

[Also: Trump administration, HHS stepping away from Affordable Care Act promotion, bundled payments]

In the past 12 months, Remedy reported a $500 million reduction in the cost of unnecessary medical expense from its bundled payments programs at more than 1,000 healthcare locations in 43 states.

Hospital readmissions decreased by 6.1 percent and a patient's length of stay at a skilled nursing facility decreased by 6.3 percent.

"We're seeing broad adoption," Garcia said, including from commercial payers implementing programs. "There's incentive. The hospitals that we talk to are very supportive of bundled payment programs, they want to participate, they want to be at center of value-based reimbursement,"

Incentives for physicians for advanced alternative payment models under MACRA will not change, he said.

While accountable care organizations engage primary care physicians, bundles also engage the specialists, he said.

Michael Abrams, co-founder and managing partner of Numerof and Associates in St. Louis, Missouri, said it is employers who will be the
loudest voice for innovation and change, to lower the cost of care.

"I think that by making bundled payments voluntary, I don't see that as pulling the rug out from hospitals. It allows them to opt in, instead of giving them no choice but to opt in," Abrams said.

Abrams believes the research is not all in to determine if providers save money using bundles.

"(Research) suggests it can save money, it doesn't always," Abrams said. "But the quality of care  is good or even better. There's no reason not to go down that path."

Archway Health founder Dave Terry, who has worked in payment reform for 20-plus years, also believes bundles should be voluntary.

Eliminating the mandatory models gives CMS greater flexibility to design and test innovations that will improve quality and care coordination across the inpatient and post-acute-care spectrum, the agency said in the proposed rule.

Twitter: @SusanJMorse

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