Bundled Payments: How to Avoid Fear of Missing Out

Today, more than 2,000 organizations participate in a Medicare bundled payment program, such as the Bundled Payments for Care Improvement (BPCI) program, the Comprehensive Care for Joint Replacement (CJR) Model and the Oncology Care Model (OCM). Moreover, many organizations have applied to participate in the latest model – BPCI Advanced– while others are assessing their readiness and building capabilities to prepare for the Spring 2019 application period.

These models give both existing and new entrants experience in the value-based payment environment, allowing them to achieve significant savings. But what’s happening outside the Medicare programs is also promising. Hundreds of bundled payment initiatives exist in the private sector, with more than 20% of employers contracting for bundled payments directly with providers.

Both the public and private sectors are moving forward with alternative payment models (APMs), including bundled payments, at a rapid pace. But providers must have an essential skill set in order to engage in and prepare for these models. For example, BPCI Advanced participation requires expertise, foresight, claims analytics capabilities, and planning to develop an effective approach to and implementation of gainshare arrangements with physicians.

For organizations that missed the enrollment period, community physicians are taking precedence, or they were not yet ready to take on risk for BPCI Advanced but want to apply to the model in 2019, as well as those that want to experiment with bundled payments in general, there are a few promising options available to them.

Partner with Physicians
Hospitals should consider how they can work with community physicians as partners in care, especially if they are participating in BPCI Advanced. Looking to be a partner is an essential component to creating a mutually beneficial relationship with BPCI Advanced participant physician group practices.

Hospitals effectively becoming preferred partners are implementing two primary methods.

• They’re exploring how their hospital can better coordinate care by providing timely data, forming care redesign initiatives and working with physicians to optimize discharge plans.
• They’re developing Net Payment Reconciliation Amount Sharing Agreements with physicians to create alignment. This may require taking on risk but could have upside options. Additionally, resource intensive bundles can also create Internal Cost Savings arrangements with physicians, to simultaneously help hospitals reduce internal costs while providing physicians with the ability to access additional incentives.

By definition, BPCI Advanced episodes require an inpatient or outpatient visit to an acute care hospital. Organizations that strive to be the preferred hospital will look for opportunities to help community physicians achieve success with their episodes.

Experiment with Shadow Bundles
One of the most unique and potentially lesser-known options is the concept of a “shadow bundle.” Organizations that already have established population health infrastructure and access to claims data through an accountable care organization (ACO) or clinically integrated network (CIN), can experiment with shadow bundles to extend their population health management work to specialists and post-acute providers using nationally-recognized bundled payment models as a blueprint.

A shadow bundle uses the existing ACO attributed population and claims data to develop a bundled payment model. ACOs can choose their episode(s) within the shadow bundle for a defined duration, centered on either chronic or surgical episodes, and customize incentives and distribution of gains without the risk associated with formal participation. Any gainshare paid to aligned specialists will be based on ACO shared savings, creating a strong incentive for specialists to be engaged in ACO success.

ACOs and CINs considering participation in a shadow bundled payment model can expect a range of revenue, cost, quality and patient care improvements. However, they must have a complete understanding of specialist interest in bundles before going down this path to avoid developing a program that is specialist-focused without having the buy-in to be successful.

Prepare for BPCI Advanced in 2020
There are several actions organizations can take today to prepare for BPCI Advanced in 2020. A critical first step is to learn as much about the program as possible in order to make informed decisions prior to the Spring 2019 application period.

Even without claims-based data, it’s essential for hospitals to understand the capabilities and care redesign efforts that will be needed to support specific bundles. Hospitals are coming together in Premier’s Bundled Payment Collaborative to share their keys to success with bundled payments, including how to develop post-acute care networks, create effective physician engagement strategies, and optimize their care coordination efforts. Based on their learnings, we’ve laid out four essential steps for future bundled payment success.

• Educate key stakeholders around what goes into building a successful bundled payment program.
• Conduct an initial landscape assessment to identify physicians in your market that are engaged in bundles.
• Ensure there is potential for further specialist engagement and buy-in.
• Identify post-acute care challenges and opportunities to ensure the program is focused on post-acute utilization reduction.

For many organizations that missed out on BPCI Advanced or want to experiment with a bundled payment model, these strategies are key to not only engage specialists in bundle payment activities but to also prepare for the second BPCI Advanced application period in 2019.

Premier® offers a range of expertise in bundled payment model readiness, preparation, development and implementation. To find out more about shadow bundles, BPCI Advanced or bundled payment models in general, download Ready, Risk, Reward: Keys to Success in Bundled Payments or contact us.