Analysis of CMS Bundled-Payments Program Provides Inconclusive Results

A recently released evaluation report found that the CMS bundled-payment program was effective in some areas and ineffective in others; however, the researchers ultimately ruled that the available evidence was insufficient to make an accurate determination of the program's performance.

Laura A Dummit, MSHP, vice president of The Lewin Group, and colleagues conducted an evaluation of the first year of the Bundled Payments for Care Improvement (BPCI) initiative. The study included data from October 2013 through September 2014, from hospitals that voluntarily opted to participate in the early trial phase of the BPCI initiative. The observational study examined models 2, 3, and 4 of the BPCI. The results are based on data from 94 Awardees with 227 episode initiators, totaling 58,410 episodes of care. Overall, the 256-page report reflects data from 15 clinical episode groups.
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Study results showed that among these 15 episode groups there were slight reductions in Medicare episode payments; however, the researchers also noted isolated instances of quality decline and fewer instances of increases in quality of care. Furthermore, the report concluded that among the 15 episode groups studied, 11 had potential to save money.

Among orthopedic surgery, patients received better care and reduced costs by about 3% for hospitals under the BPCI. However, under model 4, payments and utilization increased for cardiovascular surgery, while functional outcomes declined.  Additionally, Medicare payments for spinal surgery increased, but mortality declined as a result.

The researchers emphasized that the study had numerous limitations, including limited sample size and the voluntary nature of participation. They noted that hospitals that opted to participate tended to be larger organizations with higher-income patient populations.

“More study is needed before generalizing these results to other providers or the full range of clinical episodes,” the researchers wrote. “This study also does not account for the quarterly reconciliation amounts, so additional analyses are needed to estimate total savings to the Medicare program associated with BPCI. Our evaluation is ongoing, however, and given the recent growth in participation, which generally is not reflected in this report, our ability to detect changes in payment or quality for additional episode groups will increase.”

In a blog post, Patrick Conway, MD, principal deputy administrator and chief medical officer at CMS, portrayed these results in a positive light.

“Early results are encouraging: orthopedic surgery bundles, in particular, have shown promising results on cost and quality in the first two years of the initiative,” Conway said. “These models keep the patient at the center of care delivery and focus on well-coordinated, high quality care.”

He concluded “While there is more work to be done, CMS continues to move forward to achieving the Administration’s goal to have 50 percent of traditional Medicare payments tied to alternative payment models by 2018.”—David Costill