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CMS to Further Delay Rollout, Expansion of Bundled Payment Programs

March 20, 2017
by Rajiv Leventhal
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The Centers for Medicare & Medicaid Services (CMS) is delaying the start and expansion of some of its bundled payment programs as the agency said more time is needed for review, and for participants to fully understand the rules.  

According to a notice posted in the Federal Register, the interim final rule from CMS further delays the final rule titled "Advancing Care Coordination Through Episode Payment Models (EPMs); Cardiac Rehabilitation Incentive Payment Model; and Changes to the Comprehensive Care for Joint Replacement Model,” from March 21 to May 20. The interim final rule also “delays the applicability date of the regulations at 42 CFR part 512 from July 1, 2017 to October 1, 2017 and effective date of the specific CJR regulations itemized in the DATES section from July 1, 2017 to October 1, 2017.” CMS added, “We seek comment on the appropriateness of this delay, as well as a further applicability date delay until January 1, 2018.”

In December, federal officials said they were finalizing cardiac and orthopedic episode payment models that would provide opportunities to improve care coordination and quality, and which were set to launch this year. Meanwhile, the Comprehensive Care for Joint Replacement Model, which began in April 2016, was slated for expansion, also this year.

Specifically, the Department of Health & Human Services (HHS) said in December, “These models will reward hospitals that work together with physicians and other providers to avoid complications, prevent hospital readmissions, and speed recovery.” The idea, is that under these new approaches, the hospital in which a Medicare patient is admitted for care for a heart attack, bypass surgery, or a hip or femur procedure, will be accountable for the quality and cost of care provided to Medicare fee-for-service beneficiaries during the inpatient stay and for 90 days after discharge.

HHS noted in December with this announcement that in 2014, more than 200,000 Medicare beneficiaries were hospitalized for heart attack treatment or underwent bypass surgery, costing Medicare over $6 billion But the cost of treating patients for bypass surgery, hospitalization, and recovery varied by 50 percent across hospitals, and the share of heart attack patients readmitted to the hospital within 30 days varied by more than 50 percent. As such, these bundled payment efforts are designed to reduce this excessive spending, according to the feds.

What’s more, HHS said that these new payment models and the updated Comprehensive Care for Joint Replacement Model give clinicians additional opportunities to qualify for a 5 percent incentive payment through the Advanced APM path under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) and the Quality Payment Program.

But now, these delays lead to more uncertainty regarding the future of these payment models and how they might align with MACRA. It also once again brings into question what new federal officials Seema Verma (CMS Administrator) and Tom Price, M.D. (HHS Secretary) think about the bundled payment programs. Both have said they do not think that participants should be forced to join these models. This is the second delay of the cardiac bundled programs; President Trump’s “Regulatory Freeze Pending Review” on Jan. 20 was the first.

CMS said in the rule today, “These delays postpone the applicability of the EPMs and the CR Incentive Payment model, as well as the date on which conforming changes to the CJR model regulations take effect, for an additional 3 months. This additional 3-month delay is necessary to allow time for additional review, to ensure that the agency has adequate time to undertake notice and comment rulemaking to modify the policy if modifications are warranted, and to ensure that in such a case participants have a clear understanding of the governing rules and are not required to take needless compliance steps due to the rule taking effect for a short duration before any potential modifications are effectuated.”

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