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"Their cancellation was a step in the wrong direction for pursuing a healthcare system that focuses on value and not volume."
In a new JAMA commentary, 3 researchers argue that CMS is moving backwards when it comes to bundled payments.
The commentary comes in response to the agency’s decision to reverse course and cancel mandatory bundled payment programs for both joint replacement and cardiac interventions. The cardiac initiative was announced in December 2016 and intended to begin this month, but were derided by since-ousted HHS head Tom Price and later cancelled.
The viewpoint article, “The Rise and Fall of Mandatory Cardiac Bundled Payments,” was authored by Rishi K. Wadhera, MD, MPhil, Robert W. Yeh, MD, MSc, and Karen E. Joynt Maddox, MD, MPH. All cardiologists, they come from Brigham and Women’s Hospital and Harvard Medical School (both in Boston, Massachusetts) and the Washington University School of Medicine in St. Louis, Missouri, respectively.
The trio say that the fee-for-service reimbursement system “promotes the delivery of fragmented and inefficient care by physicians, hospitals, and postacute care facilities,” while bundled payments emphasize collaboration, care coordination, and efficiency.
The trio notes that previous programs encouraging bundled payment models for interventions like coronary artery bypass graft all “offered promise.” The original Bundled Payments for Care Improvement (BPCI) initiative, launched by CMS, showed substantial Medicare savings in hospitals that chose to participate—as much as $1,625 on cardiovascular condition treatment and $4149 for cardiovascular procedures. But because of the voluntary nature, sample sizes are small.
“Some preliminary analysis we have suggests that the hospital types that are in the voluntary programs are pretty different from the national average,” another expert, Amol Navathe, MD, PhD told Healthcare Analytics News™ in a previous interview. A leading health economist from the University of Pennsylvania, Navathe said that volunteering hospitals tend to be urban, nonprofit, and higher-volume, and that self-selection can skew the results.
“We want evidence that we can’t get with the selection that takes place in voluntary programs,” Navathe said.
The plan introduced in the final months of the Obama administration wouldn’t have made them universal throughout the country, but it would have greatly expanded their use: the joint replacement program had taken effect in 67 geographic regions, while the cardiac bundles would have been in 98 areas beginning in 2018.
That sort of mandatory expansion, the JAMA commentary argues, would have been the best test case for them yet, but “mandatory cardiac bundled payments were over before they began.”
The provided rationale for CMS’s cancellation may have been that they wanted to give stakeholders time to provide input on the model, but the authors write that politics may have played a part. Tom Price’s stance (he once said bundled plans were “experimenting with Americans’ health”) and a new administration’s “lack of enthusiasm for value-based payment programs initiated under the Patient Protection and Affordable Care Act,” could have been the motivation.
The cancellation, they write, “was a step in the wrong direction for several reasons.” The mandatory models would have provided impetus for health organizations to reassess their own practices and realign to provide good care at a better value while finally providing necessary data that could have shaped future programs.
Some hospitals that would not have otherwise participated could have also been surprised, Navathe told HCA News. In the mandatory joint replacement program, about half of hospitals achieved noticeable savings. “There’s got to be participant hospitals in there that wouldn’t have volunteered and yet achieved savings while hitting quality targets,” he said.
“Rising Medicare expenditures, and health care spending in general, are unsustainable and can’t be ignored,” the new commentary states. “Despite a continued and pressing need to bend the cost curve, the use of 1 potential tool…has been abandoned.”