September 2016
Furthering the agency’s stated intention to pay for value over volume, the Centers for Medicare & Medicaid Services (CMS) recently issued a proposed rule representing the first expansion of mandatory hospital-centric bundled payment models to non-elective procedures and for a patient population with a large proportion of chronic conditions.  It is apparent that CMS views bundled payments as a reimbursement paradigm of the future to promote better care coordination and improved patient outcomes, while also reducing costs for the overall Medicare program. Some 30 percent of Medicare payments already flow through alternative payment models, and when finalized this Rule will move CMS closer to its stated goal of achieving 50 percent by 2018.
The proposed rule, issued on July 25, contains three new components and also expands and revises certain aspects of the Comprehensive Care for Joint Replacement (CJR) payment model which began April 1.  Major elements of the proposal include:
  • A new retrospective bundled payment model for cardiac care (Cardiac Model), including acute myocardial infarction (AMI) and coronary artery bypass graft (CABG), in 98 randomly selected metropolitan statistical areas (MSAs) which will be named in the final rule;
  • A new incentive payment model (Cardiac Incentives) to encourage increased use of cardiac rehabilitation in 90 MSAs (45 of which will be the same as those selected for the Cardiac Model);
  • Proposed pathways for physicians participating in various CMS bundled payment models to qualify for payment incentives under the Quality Payment Program implementing the Medicare Access and CHIP Reauthorization Act (MACRA); and
  • Expansion of the CJR payment model, now applicable in 67 CJR MSAs, to include episodes for hip and femur fractures that do not require a lower extremity joint replacement already covered under CJR (SHFFT).

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