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Medicare Official Suggests Other Possibilities for Future Bundled Payment Experiments

By Rebecca Adams, CQ HealthBeat Associate Editor

September 6, 2011 -- The Center for Medicare and Medicaid Innovation will soon be experimenting with a number of new programs to test the idea of bundling payments to a team of medical providers, a top health official said in a conference call.

Valinda Rutledge, director of the Patient Care Models Group at the Innovation Center, said on a call hosted by The Advisory Board Co. that a new project announced Aug. 23 that will test the concept of bundled payments is just an initial step. Under bundled payments, providers who would normally receive separate reimbursements for each service given to a patient instead get a payment they would share for each treatment episode. Hospitals, physician groups and other providers can apply to receive bundled payments through the project announced in August.

Rutledge said that she is also collecting ideas about how to create other opportunities for bundled payments. Examples she cited include a potential initiative to bundle payments for treatment of a specific disease or for patients with chronic diseases.

"This is our first phase in bundled payments," she said. "We have some other phases that will be coming out."

The program announced Aug. 23 allows bundled payments under four different models of care. The first would be for acute care hospital stays, and providers who want to participate have to send health officials a nonbinding letter of intent by Sept. 22. The other models—which have a Nov. 4 deadline for a letter of intent—would combine payments for acute care hospital stays as well as post-acute care associated with a stay, or just post-acute care. Under the fourth model, which also has a Nov. 4 deadline, the Centers for Medicare and Medicaid Services, which runs the innovation center, would create a single, prospective bundled payment for all services provided by a hospital, physicians and other providers during an inpatient stay.

The Innovation Center is not limiting the number of applicants who will be able to participate in the program announced last month, Rutledge said. The guidelines are that the center needs enough participants to be sure that there is a sufficient number of diverse experiments conducted so that officials can gauge whether the idea of bundled payments can be expanded nationally.

Under the Aug. 23 program, Innovation Center officials can waive anti-trust rules such as anti-kickback statutes or rules prohibiting providers from referring patients to facilities in which they have an interest. Those waivers would be granted on a case-by-case basis, said Innovation Center officials. Providers would not have to get additional waivers from the Department of Health and Human Services or the Office of Inspector General.

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