Alternative Reimbursement Models: Bundled Payment and Beyond

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Abstract

The Bundled Payments for Care Improvement (BPCI) initiative was begun in January 2013 by the U.S. Centers for Medicare & Medicaid Services (CMS) through its Innovation Center authority, which was created by the U.S. Patient Protection and Affordable Care Act (PPACA). The BPCI program seeks to improve health-care delivery and to ultimately reduce costs by allowing providers to enter into prenegotiated payment arrangements that include financial and performance accountability for a clinical episode in which a risk-and-reward calculus must be determined. BPCI is a contemporary 3-year experiment designed to test the applicability of episode-based payment models as a viable strategy to transform the CMS payment methodology while improving health outcomes. A summary of the 4 models being evaluated in the BPCI initiative is presented in addition to the awardee types and the number of awardees in each model. Data from one of the BPCI-designated pilot sites demonstrate that strategies do exist for successful implementation of an alternative payment model by keeping patients first while simultaneously improving coordination, alignment of care, and quality and reducing cost. Providers will need to embrace change and their areas of opportunity to gain a competitive advantage. Health-care providers, including orthopaedic surgeons, health-care professionals at post-acute care institutions, and product suppliers, all have a role in determining the strategies for success. Open dialogue between CMS and awardees should be encouraged to arrive at a solution that provides opportunity for gainsharing, as this program continues to gain traction and to evolve.

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