The Trump Administration has rolled out its first CMS Innovation Center Medicare bundled payment initiative, the Bundled Payments for Care Improvement Advanced (BPCI Advanced). Under the new voluntary model, CMS will test whether bundled payments for 29 inpatient and 3 outpatient clinical episodes will lead to reduced Medicare expenditures while improving quality of care for Medicare beneficiaries. CMS anticipates that the performance period of the BPCI Advanced model will begin on October 1, 2018 and run through December 31, 2023.

BPCI Advanced builds on the ongoing Bundled Payments for Care Improvement (BPCI) initiative, which was launched in 2013 and runs through September 30, 2018. As in the BPCI model, BPCI Advanced seeks to incentivize providers to coordinate care to furnish services more efficiently while maintaining quality. Specifically, participants may either realize a gain or loss depending both on (1) how successfully they manage total Medicare fee-for-service costs of care (with limited exceptions) throughout each 90-day episode of care and (2) performance on specified quality measures.

There are key differences between the original BPCI and BPCI Advanced models, including the following (among others):

  • Participation Options. Rather than offer multiple participation options (as in BPCI), BPCI Advanced provides a single retrospective bundled payment mechanism and one risk track, with all participants required to assume downside financial risk from the outset of the model performance period.
  • Clinical Episodes. The number of clinical episodes is reduced from 48 inpatient episodes under BPCI to 32 under BPCI Advanced (29 inpatient and 3 outpatient episodes). The specific episode definitions are posted here. CMS explains that it removed clinical episodes with low participation rates or that included too many clinically-diverse procedures or conditions. BPCI Advanced participants must commit to being held accountable for one or more clinical episodes, and they may not add or drop an episode until January 1, 2020. CMS may elect to revise the BPCI Advanced clinical episodes annually beginning January 1, 2020 (applicable to both new and existing participants).
  • Clinical Episode Initiation. Clinical episodes are triggered by the submission of a claim for either an inpatient hospital stay or an outpatient procedure at an acute care hospital (ACH) by an “Episode Initiator.” Only Medicare-enrolled ACHs and physician group practices (PGPs) may be “Episode Initiators” — episodes may not initiate with the delivery of post-acute services (although post-acute care providers can participate as Convener Participants, as discussed below). Certain types of hospitals, such as critical access hospitals and cancer hospitals, are excluded from the model.
  • Financial Methodologies. There are a number of differences in the BPCI and BPCI Advanced financial methodologies. For instance, under BPCI Advanced, CMS will calculate and distribute preliminary target prices prior to the first performance period of each Model Year. The CMS discount is 3% (subject to future adjustment), with semi-annual reconciliation and a risk cap applied to clinical episodes at the 1st and 99th percentile of spending. Reconciliation payments will be subject to a 20% stop-loss and stop-gain limit at the episode initiator level.
  • Advanced Alternative Payment (APM) Model. BPCI Advanced qualifies as an Advanced APM under the physician Quality Payment Program. Note that an eligible clinician’s participation in BPCI Advanced will not be tracked for purposes of the Qualifying APM Participant determination until the performance period beginning on January 1, 2019.

There are two ways that interested parties may participate in BPCI Advanced: as either a “Convener Participant” or “Non-Convener Participant.”

  • Convener Participants bring together multiple downstream “Episode Initiators” (ACHs and PGPs), facilitate coordination among providers, and bear and apportion financial risk.  Medicare-enrolled providers or suppliers (including but not limited to ACHs and PGPs) and entities not enrolled in Medicare may participate in BPCI Advanced as a Convener Participant.
  • A Non-Convener Participant bears financial risk only for itself, not on behalf of multiple downstream Episode Initiators. Only PGPs and ACHs may participate as a Non-Convener Participant.

Convener Participants and Non-Convener Participants may enter into shared payment agreements with individual downstream physicians, non-physician practitioners, and “sharing partner” (including accountable care organizations and post-acute care providers) to furnish care during BPCI Advanced clinical episodes. Any sharing arrangement must satisfy all requirements set forth in the BPCI Advanced Model Participation Agreement.

Applications for BPCI Advanced will be accepted through March 12, 2018. CMS expects to provide a second application opportunity in January 2020. Detailed information regarding the BPCI Advanced model is available on the CMS website. CMS also is hosting a call on January 30, 2018 to answer questions from interested parties on the new initiative; registration is required to participate in the call.