HHS makes move to put an end to mandatory bundled payment models

Tom Price - opioid briefing
HHS Secretary Tom Price has been a vocal critic of mandatory bundled payments, and the agency's latest move indicates it wants to put an end to the programs.

Concerns that the Trump administration may back away from bundled payment models seem to be justified.

The Department of Health and Human Services proposed late last week to cancel mandatory payment programs for heart attacks and joint replacement. The programs have been delayed twice since HHS Secretary Tom Price took office but were due to take effect in January 2018.

RELATED: CMS holds off on bundled payment expansion, implementation

Bundled payments pay multiple providers with a single lump-sum payment for a complete episode of care. Medicare experimented with the payment models, and hospitals voluntarily participated in them. But the Obama administration aimed to expand the programs and make them mandatory as part of the push to value-based care.

Price was a vocal critic of mandatory bundled payments and, as a congressman, claimed that the Centers for Medicare & Medicaid Services overstepped its bounds by making them a requirement because it takes decisions away from patients and physicians.

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But the future of the new payment models for heart attacks, bypass surgery, hip fractures and femur fractures is now in serious doubt with a proposed rule sent to the Office of Management and Budget titled “Cancellation of Advancing Care Coordination through Episode Payment and Cardiac Rehabilitation Incentive Payment Models, Changes to Comprehensive Care for Joint Replacement Payment Model.”

The office reviews regulations before they are publicly released, and no other details were available in the preliminary federal notice.

RELATED: CMS further delays bundled payment implementation, expansion to January

The bundled payment programs were part of a federal rule issued in December, but were delayed after the Trump administration took over, presumably to give the agency time to review comments and modify the policy if necessary.

The delay was a cause of concern for one healthcare expert, who told FierceHealthcare in March that it signaled a step backward for the movement from volume to value.

“Bundled payments is a necessary next step in many respects to get away from fee-to-service toward a value-based delivery model,” Michael Abrams, cofounder and managing partner of Numerof & Associates, said.

RELATED: Healthcare strategist says bundled payment delay is a step backward for value-based care

Although research has shown that hospitals that have participated in bundled payment programs have cut costs, the American Hospital Association said in December that the mandatory push was too much.

“Hospitals should not be forced to participate in complicated new programs if the government has not already proven that they will benefit the patients we serve,” Tom Nickels, executive vice president of government relations and public policy for the AHA, said in a statement.

And in a recent Health Affairs blog post, healthcare policy experts said that the models are promising incentive tools, but they need adjusting because broad savings may be initially possible only in postacute use choices.

“That’s something," they said, "but quite a bit less" than advocates hoped for.