CMS Announces New Voluntary Bundled Payment Model that Qualifies as Advanced APM | Healthcare Informatics Magazine | Health IT | Information Technology Skip to content Skip to navigation

CMS Announces New Voluntary Bundled Payment Model that Qualifies as Advanced APM

January 10, 2018
by Rajiv Leventhal
| Reprints
Stakeholders are reacting positively to the launch of a voluntary model that is this administration’s first Advanced APM

The Centers for Medicare & Medicaid Services (CMS) yesterday announced the launch of a new voluntary bundled payment model called Bundled Payments for Care Improvement Advanced (BPCI Advanced).

The model will qualify as an Advanced Alternative Payment Model (Advanced APM) under MACRA’s Quality Payment Program; under the Advanced APM track in MACRA, providers take on financial risk to earn the Advanced APM incentive payment. “CMS is proud to announce this administration’s first Advanced APM,” CMS Administrator Seema Verma said in a statement. “BPCI Advanced builds on the earlier success of bundled payment models and is an important step in the move away from fee-for-service and towards paying for value. Under this model, providers will have an incentive to deliver efficient, high-quality care.”

Indeed, CMS officials said that under this bundled payment model, participants can earn additional payment if all expenditures for a beneficiary’s episode of care are under a spending target that factors in quality. They noted that bundled payments “create incentives for providers and practitioners to work together to coordinate care and engage in continuous improvement to keep spending under a target amount.”

Specifically, BPCI Advanced Participants may receive payments for performance on 32 different clinical episodes, such as major joint replacement of the lower extremity (inpatient) and percutaneous coronary intervention (inpatient or outpatient). The 32 types of clinical episodes add outpatient episodes to the inpatient episodes that were offered in the agency’s Innovation Center’s previous bundled payment model (the Bundled Payments for Care Improvement initiative).

“An episode model such as BPCI Advanced supports healthcare providers who invest in practice innovation and care redesign to improve quality and reduce expenditures,” CMS officials stated in the announcement.

In BPCI Advanced, participants will be expected to redesign care delivery to keep Medicare expenditures within a defined budget while maintaining or improving performance on specific quality measures, according to CMS. Participants bear financial risk, have payments under the model tied to quality performance, and are required to use certified electronic health record (EHR) technology. And by meeting these requirements, the model qualifies as an Advanced APM.

CMS said it designed this model taking into account rigorous evaluation results from previous CMMI (Center for Medicare and Medicaid Innovation) models, industry experience with bundled payment, and stakeholder input from healthcare providers at acute care hospitals, physician group practices, and other providers and suppliers.

Just a short time ago, CMS officially finalized a rule that cancelled mandatory hip fracture and cardiac bundled payment models. Verma has said in the past that she doesn’t think bundled payment models should be mandatory, a sentiment that some industry experts wholeheartedly agree with.

As such, it’s expected that the launch of this model will be received with praise, since it’s voluntary and also since it qualifies as an advanced APM. In a statement from the Charlotte, N.C.-based Premier, Inc.—a BPCI convener and advisor to providers in other bundled payment models—the organization’s vice president of bundled payment services, Mark Hiller, said, “We are also extremely pleased that BPCI Advanced will support participation as an alternative payment model under MACRA’s Quality Payment Program, providing an extra incentive to participate in the program. The model is essential for APMs and qualifying eligible clinicians to earn the Quality Payment Program’s five percent bonus.”

But while this model is currently not mandatory, one industry observer thinks that providers should not see that as a reason to not participate. Darcie Hurteau, senior director of informatics, DataGen, a Rensselaer, N.Y.-based healthcare data analytics and policy firm, opined, “With CMS giving people the added incentive of making this an advanced APM, I would expect that while the program is not currently mandatory, over time it will become increasingly disadvantageous for practices not to participate in bundled payment models. This is the direction the industry is headed in, and practices will need to pay attention if they want to stay competitive.”

Clay Richards, president and CEO of naviHealth, a post-acute care management company based in Brentwood, Tenn., added in an emailed statement to Healthcare Informatics, “Under BPCI Advanced, acute hospitals, health systems, and other providers have the opportunity to improve patient care while laying a foundation for value-based reimbursement. The new model includes a convener role, which allows providers to partner with an organization that shares downside risk and provides clinical support technology and management services. With this news, CMS is encouraging providers to take responsibility for patients throughout a continuum of care by targeting increasing variation within post-acute care.”

Richards also noted, “Redesigning the continuum of acute and post-acute care to be more tailored to patient needs can generate significant savings for Medicare and substantial payments for providers. And if post-acute care utilization is historically high, the opportunities to achieve savings are even greater.”


2018 Philadelphia Health IT Summit

Renowned leaders in U.S. and North American healthcare gather throughout the year to present important information and share insights at the Healthcare Informatics Health IT Summits.

May 21 - 22, 2018 | Philadelphia