InnovationinHealthCareDelivery:BundledPaymentsforHigh-ValueCare

RobinWangDr.AmolNavathe

Agenda

• Background• Significance• StudyAims• MyContributions/Results• FinalThoughts

USHealthCareSpending

CMSprojectsnationalhealthspendinggrowthrateof5.6%for2016–2025,outpacingGDPby1.2%Healthshareeconomyriseto19.9%by2025from17.8%in(2015)

(US:$9,990)

USHealthCareQuality

FeeForService

• Traditionally,privateinsurersandMedicare/Medicaidhavepaidprovidersusingfee-for-service(FFS)reimbursement

• Providerspaidforeachoftheindividualservicestheysupply• FFSrewardsforquantity,notqualityofcare.• Incentivetoprovidemorecostlycareasopposedtohigh-valuecare,leadstoinefficientspending

• Fragmentedcare,littleincentivetocoordinatecare

BundledPayment• AlternativetoFFS,behavioraleconomicsprincipleshaveinspiredbundledpayment

• Insteadofpayingforeachserviceseparately,bundledpaymentprovidesasingle,pre-determinedpaymentacrossanepisodeofcare

• Totalfeescomparedagainsttargetprice,providersassumelossforover-targetspendingorrewardedthroughsharedsavings

• Introducesfinancialrisk-sharingamongproviders• Mayincentivizecost-consciousandhigh-qualitycarebypromotinggreatercarecoordinationandcareredesigntocutdownonunnecessaryspending(PACutilization,readmissions)

Agenda

• Background• Significance• StudyAims• MyContributions/Results• FinalThoughts

CMS(andPrivateInsurers)areRapidlyExpandingBundledPayment

Medicaregoaltolink50%ofpaymentstoalternativepaymentmodelsby2018

• 2013:BundledPaymentforCareImprovement(BPCI)• Voluntary,~1400participants

• 2016:ComprehensiveCareforJointReplacement(CJR)• Mandatory,~800hospitalsautomaticallyenrolledacross67MSAs• Lowerextremityjointreplacement(MS-DRG469,470),90-Dayepisode

• 2018:BundledPaymentsforAMI,CABG,andhip/femurfactures• Mandatory,across98MSAs

• Limitedevidenceontheeffectsofpoliciesonvalueofcare

Agenda

• Background• Significance• StudyAims• MyContributions/Results• FinalThoughts

• Describe any differences in baseline spending and quality between BPCI and CJR hospitals

• Later as data becomes available, evaluate the effects of these policies and compare spending, mortality, and readmissions

• Part of a larger portfolio of questions:

Descriptive Policy Impact

Extending Policy Analysis

Provider Responses

Prospective Design

BPCI vs. CJR

BPCI volume response & selection

BPCI commercial spillovers

LDI-AHA National Survey on Bundled Payment

HMSA cardiac, ortho, oncology

BPCI vs. EPM

BPCI impact by condition types

BPCI within hospital spillovers

Premier Cigna ACO / bundle coordination

BPCI top 10 conditions

BPCI disparities

BPCI vs. ACO mechanisms

OrthoCarolina

Anthem

Bundles vs. ACOs

CJR Private Payers

StudyAims

HeatMapsforBPCIandCJRParticipantHospitals

Agenda

• Background• Significance• StudyAims• MyContributions/Results• FinalThoughts

MedicareCost-Standardization

-WecannotsimplycomparerawMedicarepaymentstoprovidersbecausepaymentsaresubjecttomultipleadjustmentsthatdonotreflecttheactualvolumeofservicesprovided.

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MedicareCost-StandardizationMedicarePaymentAdjustments

MedicareCost-Standardization

- TomeaningfullyandaccuratelydescribetheeffectofMedicare’sbundledpaymentpolicies,needtodevelopanapples-to-applescomparison- Acrossallcomponentsofcare:

- Inpatientpayments- Readmissionpayments- HealthCareProviderpayments- Outpatientpayments- Post-AcuteCarepayments

- SkilledNursingFacilities- HomeHealthAgencies- InpatientRehabilitationFacilities

Results- ApplyingCostStandardizationMethodologytoData

ChallengesFacingBundledPayment• Administrativecomplicationsindefiningbundle,howgains/lossesdistributed

• Compensatoryvolumeresponseandshifttowardshealthierpatients

• CallsforbetterintegrationwithACOs,extendingdurationofbundle,patient-levelriskadjustment

Agenda

• Background• Significance• StudyAims• MyContributions/Results• FinalThoughts

ThankYou!

Questions?