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More Providers Opt for Bundled Payments

Katie Sullivan, MA
The number of healthcare organizations participating in CMS's bundled payment program is expected to increase in upcoming weeks.
The number of healthcare organizations participating in CMS’s bundled payment program is expected to increase in upcoming weeks.  The agency began notifying several organizations — including hospitals, nursing homes, and other healthcare providers — that they would be able to join the initiative. The bundled payment arrangement allows providers to charge patients for an episode of care at a set price.  So far, 100 organizations have enrolled in the reimbursement agreement with CMS.

Some policy experts have compared bundled payments to the reimbursement arrangements found in accountable care organizations (ACOs). Since 2012, nearly 350 organizations have embraced the ACO Medicare model, and another 250 ACOs have contracted with private commercial insurers.  25% of Medicare ACOs demonstrated enough healthcare cost saving to earn  bonus payments. The financial incentives intend to encourage quality while reducing waste, and to move providers from operating under the traditional fee-for-service model.

“We expect and plan to add ACOs annually from here on out,” said John Pilotte, director of Medicare's performance-based payment policy group.

Both bundled payments and accountable care underscore many of the goals of the Affordable Care Act.  Some participants remain uncertain about the transition to value-based reimbursement.

“I am not sure there is enough evidence from the first round to draw any strong conclusions,” said George Burkley, chief strategy officer at Signature Healthcare.  He added that Signature executives have developed several stratgies for success with bundled payments.

New reimburement models remain at the forefront of healthcare and health law reform.

“The current system has so many perverse incentives for not providing care efficiently that a lot of people think this is a step in the right direction,” said Neeraj Sood, a healthcare economist and associate professor at the University of Southern California.

Around the Web

CMS to Expand Bundled-Payment Initiative [Modern Healthcare]

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