Anesthesia Business Consultants Alerts Providers to the Medicare Bundled Payment Initiative

JACKSON, Mich.--(BUSINESS WIRE)--The Centers for Medicare and Medicaid Services (CMS) has just announced the Bundled Payments for Care Improvement Initiative. On August 23, 2011, CMS invited providers to apply to help test and develop four different models of bundling payments. Letters of intent and completed applications are due on September 22^nd, October 21^st or November 4^th, depending on the payment model. Full information is available at http://innovations.cms.gov/areas-of-focus/patient-care-models/bundled-payments-for-care-improvement.htm.

Bundling payment for services that patients receive across a single episode of care for a clinical condition or for a procedure may be a feature of an Accountable Care Organization (ACO), a step on the way to forming an ACO, or a stand-alone method for providers to share responsibilities and recompense for a global patient care package. Episode payment models support accountability at the level of an individual patient’s care, in contrast to ACOs that are accountable for a predetermined patient population level. This reduces risk and operational complexity for the provider.

Typically, the hospital or health system will define the episode and will receive and allocate the global fee. The payer (Medicare or health plan) will make a single payment to a hospital, negotiated on the basis of the average total payments to the various providers involved in the episode. The hospital will allocate the funds to the physicians and, if applicable, to the DME supplier – not necessarily in the same proportions as the traditional, separate fee-for-service payments. The importance of securing anesthesia’s seat at the table where the allocation decisions are made is obvious.

The Bundled Payments for Care Improvement Initiative is one of a number of Affordable Care Act programs intended to improve the quality of health care and reduce costs by replacing fragmented care with coordinated care centered on the patient‘s needs and preferences. According to CMS, “Research has shown that bundled payments can align incentives for providers – hospitals, post acute care providers, doctors, and other practitioners – to partner closely across all specialties and settings that a patient may encounter to improve the patient's experience of care during a hospital stay in an acute care hospital, and during post-discharge recovery.” In other words, bundled payments appear to create incentives to integrate and coordinate patient care.

Prior studies include the Medicare Participating Heart Bypass Center demonstration, the Medicare Cataract Surgery Alternate Payment demonstration, the Medicare Acute Care Episode (ACE) demonstration, the Physician Hospital Collaboration demonstration, and the Medicare Gainsharing demonstration.

We hope that this Alert will be a useful introduction to CMS’ latest integrated-care program. For a full summary on this new development, please check out ABC’s coverage here: http://www.anesthesiallc.com/publications/ealerts/274-the-medicare-bundled-payment-initiative-and-anesthesia-services

About Anesthesia Business Consultants

ABC, established in 1979, is one of the largest billing and practice management companies dedicated to the complex and intricate specialty of anesthesia and pain management. It is both an American Society of Anesthesiologists Practice Management Supporter, and an Anesthesia Quality Institute Preferred Vendor. ABC employs industry leaders, operates under proven efficient processes, and utilizes technology advances to easily adapt to the ever-changing regulatory environment.

If you would like more information about this topic, please go to [e-mail].