Planning is Critical to Addressing Bundled Payment Expansion

In July, the Department of Health & Human Services proposed new bundled payment models for cardiac care—the third bundled payment model in a little more than a year—and an extension of the existing bundled payment model for hip replacements and other hip surgeries.

The expansion brings both risk and opportunity. Many providers believe the expansion—which aims to shift Medicare payments from quantity to quality—is occurring at too fast a rate. Regardless, it is happening. And Mark Krivopal, MBA, vice president in GE Healthcare Camden Group’s population health practice, says it’s not something physicians can fight.

“It’s definitely coming down the pike,” Krivopal says. “And the best way to deal with this is to be prepared and try to kind of use the first couple of years, while the penalties may not be as significant, to experiment.”

An ounce of preparation

Krivopal says that one of the first steps toward being fully prepared is for physicians to take a close look at their practice. For example, is there enough transparency to understand what’s occurring from a workflow perspective? Or from the perspective of data gathering, and sharing that information up and down the practice?

“How have you done as an organization with previous performance improvement projects?” Krivopal asks. “Have there been a lot of barriers and pushback, or have there been successful interventions?”

Those past experiences should serve as a solid barometer for moving forward into the wild world of bundled payment expansion.

But Krivopal suggests going even further.

“This is really a true opportunity for physicians to lead the change,” he says. “For physicians to sort of activate the process.”

Issues arise

One of the complicating factors surrounding bundled payment expansion is the up front investment in resources, assets, and time.

“It requires physician time,” Krivopal explains. “And it requires cooperation across the continuum. I’m talking about pre-hospital, hospital, and post-hospital. Now you have to manage relationships with organizations that you may not necessarily control.”

For example, Krivopal suggests a scenario where a patient gets discharged after a hip fracture that has all been handled through the bundled payment model. Imagine that same patient also has some behavioral issues, or some psychiatric issues. They need help, and that involves coordinating with facilities that are not under your control.

“You have to contract with these community resources,” Krivopal says. “These are some of the issues that arise.”

But, there are also financial benefits. If you reorganize care for a particular disease process, such as a hip fracture, you may do well on bundled payments. And, you may experience a sort of halo effect.

“The nurses know how the process works,” Krivopal says. “The physicians are trained in the performance improvement process, and you definitely get some benefit across the system. And down the road, you’d have some financial savings.”

Cardiac concerns

Krivopal says the proposed new bundled payment model for cardiac care tends to complicate matters a bit. That’s because previous models such as comprehensive care for joint replacement was more focused on elective surgeries. But in the cardiac world, the discussion changes to heart attacks and bypass surgery, which are not elective surgeries.

“You can’t know that I’m going to walk into your hospital in five minutes with a heart attack, right?” Krivopal asks, rhetorically. “How can you engage me as a patient if you don’t know when I’m going to come in? This creates a whole new complex system.”

And that, Krivopal says, is why physicians need to take a leadership role with regard to these bundled payment expansion models.

“Heart disease is different from hip replacement,” he says. “But at least we can get the process down. We need to be at the table.”

All of this emphasizes the importance of system preparedness.

“Have you done something like this before?” Krivopal says, of the questions physicians need to consider. “Do you have effective ways to engage your providers, patients and staff? That’s the first important strategic step.”

The second is what Krivopal calls “a deep dive” into actual program development.

“If the process is put in place, how are you going to monitor it?” he says. “And then comes the big, big aspect of gain sharing.”

In other words, as you seek to achieve a positive bottom line, do the savings stay in the practice? Or in the hospital? Does it come back to the physician? Is there a split? What happens when the funds flow? When do they become available?

“All of these things need to be talked about and planned out,” Krivopal says. “It really gets into the clinical pathways and the oversight. You know, who plays well in the sandbox, and who doesn’t?”