Optimize Bundled Payment Programs with Outcomes

November 03, 2015


Comprehensive Care for Joint Replacement (CJR)

Beginning in 2016, the Centers for Medicare and Medicaid Services have mandated the use of bundled payments for knee and hip replacements in 67 metropolitan areas at close to 800 Hospitals. This is referred to as Comprehensive Care for Joint Replacement (CJR) and is an extension of the Bundled Payment for Care Improvement (BPCI) initiative. This model is increasingly being deployed to motivate the delivery of better patient outcomes at lower costs. Previously, BPCI programs had been voluntary. Now that they are being mandated, hospital systems not previously participating will have to adapt quickly.

Proactive organizations interested in value initiatives like BPCI can learn a lot from organizations that have been refining the process. Getting bundled payments right in healthcare from Harvard Business Review does a great job investigating the successful techniques used by two private practices. To sum up the findings of the HBR article:

1. High-quality data on outcomes and costs: “Going forward, having compelling outcomes data will likely become even more important since, in the absence of being able to demonstrate superior outcomes, payers will continue to put pressure on payment rates.”
“RI and HOI share comparative cost and outcomes data directly with physicians, allowing the physicians to see their core strengths and opportunities.”

2. Proactive management of patients: “RI uses information in its risk assessment to guide the decision about the clinically-appropriate facility — academic medical center, community hospital, or orthopedic specialty hospital — for the patient’s operation.”

3. Alignment of physicians and hospitals: “This is important since both the physician and the hospital must coordinate and integrate care to achieve superior, low-cost outcomes for their patients.”

BPCI initiatives and mandates such as these are only further examples of the continuous shift to value-based care. The most difficult component of establishing value (outcomes/cost) is outcomes requiring proactive and long-term dedication to their collection. Hospitals and practices can no longer ignore the need for effective collection and analysis of outcomes.

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