CMS Testing Episode Cost Measures for Future Payment Program

As the healthcare industry continues to innovate, the Centers for Medicare & Medicaid Services (CMS) is charging forward to test and roll out new payment models. In October, CMS announced the field testing of eight, physician-driven bundles that could be used in the cost performance category under the Merit-based Incentive Payment System (MIPS) in the future. While MIPS may be on the chopping block, do we really think that’s likely to happen?   Previous CMS testing gives us reason to believe that CMS may incorporate its findings into future bundled payment programs.  

The eight episode cost measures include:

1.     Elective Outpatient Percutaneous Coronary Intervention (PCI)
2.     Knee Arthroplasty
3.     Revascularization for Lower Extremity Chronic Critical Limb Ischemia
4.     Routine Cataract Removal with Intraocular Lens (IOL) Implantation
5.     Screening/Surveillance Colonoscopy
6.     Intracranial Hemorrhage or Cerebral Infarction
7.     Simple Pneumonia with Hospitalization
8.     ST-Elevation Myocardial Infarction (STEMI) with (PCI)

CMS released specifications for the bundles including new trigger site criteria; some of these bundles also include pre-trigger periods ranging from 30 – 60 days.  

Before we expand further on this topic, let us pause to acknowledge that your experience is important, and CMS wants to hear from you. Share your feedback through an easy, online survey on these test measures by November 15, 2017.

Another Win For Physicians

In all of these episode-based cost measures, or bundles, the episode is attributed to a physician. This confirms and reinforces the priorities outlined in the RFI released in September concerning the Center Medicare and Medicaid Innovation (CMMI) “new direction.” The content of the RFI strongly suggested the prioritization of physician-driven models, and CMS continues to reaffirm its commitment with the field testing of these new physician-focused cost measures. Like CMS, we see value in this approach as evidenced by our experience. Bundled programs can be successfully utilized across the continuum of care, however, specialist providers are among the group to most consistently demonstrate value when owning the bundle.

Outpatient Bundles

For five of the eight bundles, the trigger event can take place in an ambulatory setting, indicating CMS is exploring the implementation of outpatient bundles. Ambulatory bundles have been an untapped source of savings for CMS. These bundles are more conducive to physician-driven, value-based care, and eliminate the reliance on MS-DRG assignment, which has been a challenge for Bundled Payments for Care Improvement (BPCI) participants. Adoption of the outpatient knee arthroplasty measure was contingent on CMS’ decision to pay for the procedure in the hospital outpatient department setting, which CMS confirmed it would on November 1, 2017.  Field testing of outpatient bundles also helps inform improvements in the physician attribution process, improvements which may be adopted in the next generation of BPCI.

New physician attribution

CMS is also exploring an alternative attribution methodology for the new inpatient-anchored bundles it is testing. In the current BPCI program, bundles are attributed to the attending or operating physician on the inpatient claim. CMS has intimated that hospitalists being assigned the bundle was an unintended consequence of the program’s design.  

For the new bundles triggered by an inpatient admission, the attributed clinician is the clinician who renders at least 30% of the evaluation and management services provided during a hospitalization. It is clear that hospitalists, who care for patients while in the hospital, are not the best-suited providers to care for a patient 30-60-90 days after discharge, and this new method may reveal opportunities for improvement in upcoming programs.  

How to Participate

Archway is glad to see CMS moving full speed ahead in developing physician-focused innovative payment models. Regardless of how the MIPS final rules work, we are pleased to see CMS learning from past programs to enhance future advancements in alternative payment models.

Share your feedback with CMS by November 15, 2017.

We also strongly urge physicians to access confidential feedback reports on these measures. For those participating in any of the eight bundles above, you may be able to view your Field Test Report on the CMS Enterprise Portal. There is further information on the MACRA site. If you need any help understanding your data and reports, please contact us at to arrange a one-on-one discussion.