HHS planning new bundled payment models with mandatory participation on the table

In a speech sent to press, HHS Secretary Alex Azar indicated a new oncology bundled payment would be mandatory. (Getty Images/Wavebreakmedia)

The Department of Health and Human Services (HHS) plans to launch new episode-based payment models in multiple specialty areas, including cardiac care and radiation oncology—some of which may be mandatory.

While the Centers for Medicare and Medicaid Services (CMS) put an end to mandatory cardiac bundled payment models nearly a year ago, it plans to revisit some of those now, HHS Secretary Alex Azar said during a speech at the Patient-Centered Primary Care Collaborative on Thursday. 

HHS appears to be targeting cancer care as its first mandatory bundle. An initial draft of Azar's speech sent to press on Wednesday evening said the agency will "launch a mandatory episode-based payment model focused on radiation oncology."

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Azar's revised version, which he delivered in a speech on Thursday, was less specific. Instead, Azar said the agency "will use all avenues available to us—including mandatory and voluntary episode-based payment models," but didn't specify which models would be mandatory. 

An HHS spokesperson declined to provide any further detail. 

However, Azar did signal the agency's willingness to lean on mandatory bundles, a notable shift from the Tom Price administration, which favored voluntary participation. 

"We need results, American patients need change, and when we need mandatory models to deliver it, mandatory models are going to see a comeback," Azar said on Thursday. 

RELATED: Cancer type can make a difference in performance of 'bundled' care models

Azar said bundled payment models can allow physicians to focus on patients rather than their staffing ratios and reimbursements for procedures and prescription drugs.

When the agency ended the cardiac models last year, it also reduced the number of geographic areas required to participate in the Comprehensive Care for Joint Replacement model. The HHS Secretary said his department is “actively looking at ways to build on the lessons and successes” of that model.

The agency will also explore new episode-based models in a host of other areas, including radiation oncology. There is already an episode-based model in oncology broadly.

Nearly 1,300 providers, a balanced mix of hospitals and physician practices, have signed up to participate in the existing Bundled Payments for Care Improvement (BPCI) Advanced model. Azar boasted that BPCI-Advanced model has generated “significant savings” in joint replacement, pneumonia and more.

RELATED: Bundled payments drive hospitals to reduce referrals to SNFs, improve coordination

But mandating participation in bundled payment models is “the most effective way to know whether [they] can successfully save money and improve quality,” Azar said, possibly suggesting a greater focus on mandated models going forward.

Secretary Azar said he believes bundled payments can play a role in preventive care, allowing providers to “see the financial rewards of helping their patients stay healthy—instead of being financially rewarded when they get sick.”