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Administration Signals Likely End to Medicare Bundled Payments Initiative

Recently posted rule suggests that the twice-postponed rule will be rescinded.

Published: August 15, 2017

TOM PRICE, MD, the Secretary of the Department of Health and Human Services, says the Center for Medicare and Medicaid Innovation "exceeded its authority."

Medicare's mandatory bundled payments program for total joints appears to be on the way out.

Tom Price, MD, Secretary of the Department of Health and Human Services (HHS), has been a vocal opponent of mandatory bundles and other service delivery models, and a newly proposed rule posted on the Office of Management and Budget Website strongly suggests that HHS is looking to eliminate mandatory bundling for joint replacements and cardiac care. The programs, delayed twice since the Trump administration took over, are due to take effect in January.

The only public information available about the new proposal is its title: "Cancellation of Advancing Care Coordination through Episode Payment and Cardiac Rehabilitation Incentive Payment Models; Changes to Comprehensive Care for Joint Replacement Payment Model."

As a Congressman from Georgia, Dr. Price claimed that the Center for Medicare and Medicaid Innovation had "exceeded its authority, failed to engage stakeholders and … upset the balance of power between the legislative and executive branches" with its proposed payment reforms.

Dr. Price and others were especially critical of a 2016 CMS initiative that required roughly 800 hospitals in 67 diverse markets to implement the bundled-payment model.

With bundling, hospitals receive a single fee for the entire episode of care, beginning at admission and ending 90 days post-op. The fee includes reimbursement for the facility, physician and anesthesia provider, and 90 days of recovery treatment.

Various studies, including one published in JAMA Internal Medicine and another carried out at NYU Langone Medical Center in New York City, suggest that bundled payments for total joints have the potential to improve quality of care and reduce costs.

Jim Burger


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