On January 9, 2018, the Centers for Medicare & Medicaid (CMS) Center for Medicare and Medicaid Innovation announced a new voluntary bundled payment model called Bundled Payments for Care Improvement Advanced (BPCI Advanced).  BPCI Advanced is the first Advanced Alternative Payment Model (Advanced APM) launched under the Quality Payment Program that was implemented as part of the Medicare Access and Chip Reauthorization Act (MACRA). 

Under the model, participants can earn additional payments from Medicare if expenditures for designated clinical episodes of care are under spending targets that factor in quality.  Initially, the model will involve 105 Medicare Severity-Diagnosis Related Groups (MS-DRGs) in 29 inpatient Clinical Episode categories, as well as three outpatient Clinical Episode categories, each identified by Healthcare Common Procedure Coding System (HCPCS) codes.  Examples include percutaneous coronary intervention (inpatient or outpatient), cardiac defibrillator, and major joint replacement of the lower extremity (inpatient). CMS may add or remove Clinical Episodes on an annual basis.

Participants select the Clinical Episodes they want to use when they sign a Participation Agreement for BPCI Advanced, and may not add or drop Clinical Episodes unless expressly permitted by CMS.

The model will use the seven quality measures listed below.  The first two measures will be required for all Clinical Episodes and the others will only apply only to certain Clinical Episodes.

  • All-cause Hospital Readmission Measure (NQF #1789)
  • Advanced Care Plan (NQF #0326)
  • Perioperative Care: Selection of Prophylactic Antibiotic: First or Second Generation Cephalosporin (NQF #0268)
  • Hospital-Level Risk-Standardized Complication Rate (RSCR) Following Elective Primary Total Hip Arthroplasty (THA) and/or Total Knee Arthroplasty (TKA) (NQF #1550)
  • Hospital 30-Day, All-Cause, Risk-Standardized Mortality Rate (RSMR) Following Coronary Artery Bypass Graft Surgery (NQF #2558)
  • Excess Days in Acute Care after Hospitalization for Acute Myocardial Infarction (NQF #2881)
  • AHRQ Patient Safety Indicators (PSI 90)

According to CMS, the model qualifies as a MACRA Advanced APM because participants bear financial risk, are eligible for payments under the model tied to quality performance, and are required to use Certified Electronic Health Record (EHR) Technology.  To reduce the risk of adverse selection and gaming of the model, Medicare beneficiaries will not be allowed to opt out.

Participants fall into two categories:  1) Convener Participants, which bring together downstream entities called Episode Initiators, and which bear and apportion financial risk on their behalf, and 2) Non-Convener Participants, which are Episode Initiators and bear risk only for themselves and not on behalf of other Episode Initiators.  Episode Initiators must be either Acute Care Hospitals or Physician Group Practices.

Convener Participants Include:

  • Acute Care Hospitals
  • Physician Group Practices
  • Other Medicare-enrolled providers or suppliers
  • Entities that are not enrolled in Medicare

Non-Convener Participants include:

  • Acute Care Hospitals
  • Physician Group Practices

Entities other than Acute Care Hospitals and Physician Group Practices (e.g., skilled nursing facilities, home health agencies, inpatient rehabilitation facilities, and long term care hospitals) may participate as Convener Participants but not as Non-Convener Participants. Certain entities are not eligible to participate in the model at all — PPS-Exempt Cancer Hospitals, inpatient psychiatric facilities, Critical Access Hospitals (CAHs), hospitals in Maryland, hospitals participating in the Rural Community Hospital Demonstration, and Participant Rural Hospitals in the Pennsylvania Rural Health Model.

Any participant may enter into arrangements with downstream Participating Practitioners who furnish care and participate in activities under the model.  Participating Practitioners may be any physicians or non-physician practitioners who are paid separately by Medicare for their professional services.

The performance period for the BPCI Advanced model runs from October 1, 2018 through December 31, 2023. As with other models tested by CMS, a formal, independent evaluation will be used to assess quality of care and changes in spending under the model.

The deadline for submissions is March 12, 2018.  Applications and additional information are available online.  The CMS Innovation Center is holding a Q&A session on January 30, 2018 from 12 to 1 pm EDT.