Advocates of value-based payment reform breathed a sigh of relief this week when CMS announced a new bundled payment model — a year into a Trump administration that has otherwise set the healthcare industry on edge.

While debate over Affordable Care Act is still raging with Republicans controlling Congress and the White House, bipartisan support for MACRA and the movement away from fee-for-service models has held relatively steady.

CMS did cancel two bundled programs last year, objecting to the mandatory nature called by CMS Administrator Seema Verma as too restrictive. Providers finding success with bundling heavily criticized the move, and many worried it was a harbinger of more scaling back to come in the agency’s approach to value-based care.

This week’s announcement of the Bundled Payment for Care Improvement Advanced (BPCI-A) model suggests otherwise, though. And there are other signs the Trump administration might become a bit more open to mandatory programs. Alex Azar, the nominee for HHS secretary expected to receive approval soon, said this week he wouldn’t necessarily oppose mandatory programs if they are needed “to get adequate data.”

It’s a sign that value-based care can withstand political transitions, but the announcement is just the beginning.

For the new effort to make a difference, it will need adequate participation from providers committed to learning and improving their practices. Many details are outstanding as well, including exactly how quality scores will be calculated. The agency is planning to give interested providers more information in a call scheduled for Jan. 30.

Dr. David Barbe, president of the American Medical Association, told Healthcare Dive those details are critical. The metrics need to be relevant and meaningful, and need to clearly lead to improved patient outcomes. That, he said, is how strong participation would best be achieved.

“It’s not hard to get doctors to play along when they know it’s making a difference,” he said.

How BPCI-A will work

The new model is an advanced version of the (BPCI) program launched in 2013. It is voluntary and will cover 32 clinical episodes, including three that are outpatient: percutaneous coronary intervention, cardiac defibrillator and back and neck except spinal fusion.

The BPCI model rolled out five years ago had four tracks. Two included just the hospital stay, another included post-acute care and another was just post-acute care. In BPCI-A, the clinical episode will begin at the start of inpatient admission or the start of outpatient procedure and end 90 days later.

The original program allowed participants to choose an episode duration of 30, 60 or 90 days. BPCI-A will only allow the 90-day durations. The overall program length is longer as well. The first cohort will begin their performance period Oct. 1, and it will run through the end of 2023. CMS will have another application period in January 2020.

Quality metrics for the first program varied and changed over time. CMS said for BPCI-A, two metrics — hospital readmission measure and advanced care plan — will be required for all episodes. Five others will apply to select episodes.

The first BPCI included nearly 50 clinical episodes, and none of them were outpatient. The advanced model includes 32 episodes, with three outpatient. Breese said that inclusion shows the agency is looking more broadly, and “thinking about the true episode of care.” 

Also of note is that commercial payers are pushing for more and more services to take place in an outpatient setting.

BPCI-A leaves out a few areas.

A statement from DRIVE Health Initiative, a group led by employers promoting value-based care, said the new model would be strengthened if it included pre-admission services for some episodes, like heart attacks, and if it added patient-reported outcomes.

Will it be popular?

One of the most crucial elements of BPCI-A will be how many providers sign up. More participants mean more data and more approaches being tested and analyzed. The fact that no providers are required to participate could hinder success.

But several policy analysts believe the industry has reached a tipping point. Providers are increasingly seeing value-based care as the mandatory path forward.  

“It’s a very different time than it was five years ago when BPCI came out initially,” Erica Breese, senior manager at Avalere, told Healthcare Dive. “There’s more focus on value, especially with MACRA. There’s a huge incentive for physicians to participate.”

Carter Paine, chief operating officer at NaviHealth, said he expects wide-spread participation. Providers already in BPCI can share a roadmap to other interested applicants, lowering the bar for those with less experience in newer payment models. Commercial payers are also implementing value-based methods, so the trend is clear and concrete.

“We think it’s a no-brainer,” he told Healthcare Dive.

Another giant incentive is that BPCI-A will count as an advanced alternative payment model under MACRA. A major provider complaint of the payment reform legislation is the paucity of options in the advanced APM track. Those who want to get further into VBC than the Merit-based Incentive Payment System track calls for didn’t always find an acceptable alternative.

“With CMS giving people the added incentive of making this an advanced APM, I would expect that while the program is not currently mandatory, over time it will become increasingly disadvantageous for practices not to participate in bundled payment models,” said David Hurteau, senior director of informatics at the healthcare policy and analytics firm DataGen. “This is the direction the industry is headed in, and practices will need to pay attention if they want to stay competitive.”

Participation doesn’t just mean signing up, however. It also means staying in. Only 12% of hospitals eligible for the original BPCI chose to participate, and nearly half of them dropped out for at least on condition, according to a JAMA report from this week.

Hospitals that did sign up were more likely to be larger nonprofit or teaching hospitals. High operating margins were associated with participation and lower odds of leaving.

The authors suggest the program’s voluntary nature may be a weak spot. “Differences between participants and nonparticipants, which confirm prior reports, and the high rate of dropout suggest that voluntary models may not have as much potential as hoped to improve quality and reduce costs across the diverse U.S. health care landscape,” they wrote.

Dropping out of the program will be much harder this time, however. When the original program went into motion, some providers quit after the transition from only upside risk to including some downside risk. This time, there is downside risk from the beginning, and CMS is stipulating providers that begin the program cannot drop out for at least a year.

One of the biggest questions for the new model is also one of the most difficult to answer: Will it work?

The data from the original BPCI program are scattered. Some providers saw improved quality, some saw no change. Ultimately, the large number of variables and available pathways make evaluation muddy.

A Lewin Group report from October outlined the issue. “The BPCI initiative was designed with many options to encourage participation and also to allow CMS to relatively quickly assess responses to payment incentives across a range of situations,” according to the report. “This strength of the initiative, however, contributes to the main limitation of its evaluation. Because of the vast range of situations encompassed under the initiative, including the selective and heterogeneous group of participants and their limited and varied experience, it is challenging to reach conclusions about the overall impact of BPCI.”

Jeff Byers contributed to this post.

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