A study of baseline characteristics and spending of hospitals participating in Medicare's voluntary and mandatory orthopedic bundled programs found that there were few differences, indicating that mandatory programs could engage more hospitals that otherwise would not have participated in voluntary programs.
The federal government under President Donald Trump has implied that it plans to focus more on voluntary, rather than mandatory, payment models, according to a recent report from the Government Accountability Office. However, a new study in Health Affairs suggested that both voluntary and mandatory models need to play a role as the country shifts to value-based care, and also that an analysis of participants in each type of program found that hospitals were similar enough to mitigate concerns of fairness for those hospitals in the mandatory program.
The researchers compared baseline characteristics and performance among hospitals in Medicare’s Bundled Payments for Care Improvement (BPCI) initiative, which is a voluntary program, with its Comprehensive Care for Joint Replacement (CJR) Model, which is a mandatory program. BPCI was started in 2013 and is the largest voluntary program to date. CMS then used the BPCI bundled payment design to create CJR in 2016. BPCI has included 1201 hospitals, while CJR has included nearly 800 hospitals.
The researchers analyzed data from CMS to identify bundled payment episodes for patients admitted for major hip and knee joint replacement or reattachment of lower extremity with or without major complicating or comorbid conditions. These are identified as Medicare Severity—Diagnosis Related Groups (MS-DRGs) 469 and 470, respectively.
The authors found that BPCI hospitals tended to be significantly larger than CJR hospitals, with a larger mean annual Medicare patient volume. BPCI hospitals had a higher case-mix severity for both MS-DRG 469 and 470. A comparison of baseline performance found no significant differences regarding readmission rates and mortality rates for either MS-DRG 469 or 470.
Overall, although there were significant differences in organizational characteristics, there were no large differences in baseline quality or spending. This shows that the BPCI and CJR programs engaged different types of hospitals and, thus, the “results from BPCI might not be as generalizable as those from CJR,” the authors wrote.
However, the fact that there were no significant differences in baseline quality or spending indicated that mandatory programs could engage hospitals that otherwise would not have participated in voluntary programs without concerns of unfairness under a mandatory model, the investigators wrote.
“As policy makers debate how to most effectively implement bundled payment, these findings suggest that mandatory programs may be required to generate robust evidence and that either mandatory or additional targeted voluntary programs may be required to engage more hospitals in bundled payment,” the authors concluded.
One of the main limitations was that, as a descriptive study, the authors were unable to evaluate the relationship between participation and changes in quality or costs. They also noted that because they evaluated hospital participation, the findings might not be generalizable to other providers, like physician groups, or bundles that are not triggered by an inpatient admission.
Future research will need to address questions regarding how organizational differences reflect a hospital’s ability to succeed in such programs and should evaluate the impact of the voluntary and mandatory programs on spending and patient outcomes.
Navathe AS, Liao JM, Polsky D, et al. Comparison of hospitals participating in Medicare’s voluntary and mandatory orthopedic bundle programs. Health Aff (Millwood). 2018;37(6):854-863. doi: 10.1377/hlthaff.2017.1358.