With Bundled Payments Initiative, CMS Signals a Shift to Value Based Care

By Jimmy Miner, Director of Sales OperationsCMSblog250

Last week, CMS announced an initiative called Bundled Payments for Care Improvement (BPCI).   With 500 healthcare providers grouped into 4 different test models, the BPCI further validates the shift from fee-for-service to value-based care. Testing whether bundling services into “episodes of care” could help Medicare save money while motivating providers to produce better health outcomes for patients.

If successful, healthcare networks may look to reexamine their delivery model.  Under the current model an episode of care is divided into the various services a patient receives during treatment. For a broken hip, the initial ER visit, the visit within the hospital to the radiologist, obtaining equipment from a Home Health Agency, and the follow up physician visits are treated as separate parts.  By connecting the Medicare reimbursement for these combined services, CMS hopes to encourage teamwork to achieve quicker, more successful, and less expensive outcomes.

One interesting part of this announcement is that it highlights the number of different services performed by different entities during a patient’s episode of care.  While the nature of the Medicare/provider relationship makes it possible for CMS to experiment with bundled payments, patients are still responsible for separate co-pays for these services.  Often times, an “episode of care” may result in as many as 5 different bills to be paid to 5 different providers.  The resulting confusion helps explain why roughly a quarter of patients are discontent with the billing process.

Looking for additional sources of revenue, many hospitals are now adding retail clinics and wound centers to their Integrated Delivery Network (IDN); a network that may also include a HMP, PHO, Home Health Agency and hospice services.  The purpose of an IDN, after all, is to encompass a patient’s entire episode of care.  Wouldn’t it be nice if a patient could manage all of those services’ bills in one place?

2014 will be a year of change in regards to revenue cycle.  Provider collaboration will proliferate in many forms, be it affiliation, joining an Accountable Care Organization, or even participating in BPCI.  Even if you aren’t part of a healthcare network, your patients are part of one – they will always need their hospital, their physician, their specialist etc.  As you examine your patient billing process, consider not just your organization but also your entire healthcare network – and your patients’.   Is there a better way to bill and collect from patients that benefits everyone?