Under the Bundled Payments for Care Improvement initiative, organizations will enter into payment arrangements that include financial and performance accountability for episodes of care. These models may lead to higher quality, more coordinated care at a lower cost to Medicare.
Under Model 4, CMS will make a single, prospectively determined bundled payment to the hospital that would encompass all services furnished during the inpatient stay by the hospital, physicians, and other practitioners. Physicians and other practitioners will submit “no-pay” claims to Medicare and will be paid by the hospital out of the bundled payment. Related readmissions for 30 days after hospital discharge will be included in the bundled payment amount. Participants can select up to 48 different clinical condition episodes.
There are 14 participants/awardees involved in the BPCI Model 4: Prospective Acute Care Hospital Stay Only. Many participants/awardees comprise numerous sites and can be accessed as a (List).
To view an interactive map of this Model, visit the Where Innovation is Happening page.
Medicare currently makes separate payments to providers for the services they furnish to beneficiaries for a single illness or course of treatment, leading to fragmented care with minimal coordination across providers and health care settings. Payment is based on how much a provider does, not how well the provider does in treating the patient.
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.
The Bundled Payments for Care Improvement initiative includes two phases for Models 2, 3, and 4. Phase 1, also referred to as the “preparation” period, is the initial period of the initiative during which CMS and participants prepare for implementation and assumption of financial risk. Those participants in Phase 1 of Models 2, 3, and 4 that are approved by CMS and intend to assume financial risk for episodes may enter into a Bundled Payments for Care Improvement Model agreement with CMS as Awardees and begin Phase 2, also referred to as the “risk-bearing” period.
On January 31, 2013, the first set of Bundled Payments for Care Improvement Phase 1 participants were announced. Phase 2 began either on October 1, 2013 or January 1, 2014 for Awardees that have entered into Model 4 Awardee Agreements with CMS, at which point Awardees began the risk-bearing phase for some or all of their episodes. During the transition period, Phase 2 Awardees may transition episodes and/or episode initiators that have remained in Phase 1 to Phase 2 on a quarterly basis.
Phase 1 Participants
- Valley Baptist Health System (Harlingen, TX): This Awardee is a convener of health care facilities in TX in Phase 1.
- University of New Mexico Hospital - Bernalillo County Medical Center (Albuquerque, NM): This Participant is participating in collaboration with the convener, Association of American Medical Colleges (Washington, DC) in Phase 1.
Phase 2 Awardees
- Bronson Methodist Hospital (Kalamazoo, MI)
- Florida Hospital (Orlando, FL)
- Jersey Shore University Medical Center (Neptune, NJ)
- Lancaster General Hospital (Lancaster, PA)
- Methodist Hospital of Southern California (Arcadia, CA)
- St. Luke's Hospital (Chesterfield, MO)
- Torrance Memorial Medical Center (Torrance, CA)
- University of Colorado Hospital (Aurora, CO)
- University of California San Francisco Medical Center (San Francisco, CA)
- Valley Baptist Health System (Harlingen, TX): This Awardee is a convener of health care facilities in TX in Phase 2.