Bundled payment

In April, the American College of Surgeons (ACS) released Surgeons and Bundled Payment Models: A Primer for Understanding Alternative Physician Payment Approaches—a resource for members of the College. Developed by contributors from the ACS General Surgery Coding and Reimbursement Committee (GSCRC), the purpose of the primer is to inform Fellows about the concept of bundled payment and the effect this approach to reimbursement could have on surgical patients. Unlike the traditional fee-for-service model, under a bundled payment approach to surgery the surgeon, other physicians, the hospital, and possibly other health care providers and facilities share one fee for a surgical procedure or for treating a medical condition.

This column describes topics addressed in the primer, namely, existing bundled payment programs, issues to consider when developing a bundle or when determining whether to participate in a bundled payment program, and the GSCRC Surgical Bundled Care Project.

Which bundled payment programs are addressed in the primer?

The primer addresses three congressionally mandated initiatives: the Acute Care Episode Demonstration, the Medicare Bundled Payments for Care Improvement Initiative, and the National Pilot Program on Payment Bundling. The primer also describes two leading private-sector bundled payment programs: Geisinger Health Plan’s ProvenCare program and the BlueCross BlueShield of Massachusetts Alternative Quality Contract. Also analyzed in the primer is the unique case of transplant surgery, where bundled payment has been the industry standard for more than 20 years.

Does the primer provide guidance on issues to consider when developing a bundle or when determining whether to participate in a bundled payment program?

Yes. The primer addresses various topics to consider in the development of a bundle or when deciding whether to participate in a bundled payment program, including whether to center the bundle on a condition or a procedure, how to select the condition or procedure to bundle, costs included in the bundle, timeframe covered, data needed to create the bundle, incorporation of quality measures, and administration. The primer also considers concepts of attribution, gain-sharing, and risk adjustment as they relate to bundled payment. In addition, the primer highlights key differences between bundled payment and the accountable care organizations approach. Although both forms of payment seek to facilitate coordinated, integrated, and efficient care, differences exist in the focus, operation, and distribution of payment in both models.

What is the GSCRC Surgical Bundled Care Project?

An addendum to the primer provides a detailed description of the GSCRC Surgical Bundled Care Project, which was formed to develop a process for creating clinically coherent bundled payment models and analyzing the potential opportunities and barriers for surgery. The GSCRC workgroup involved with the project developed criteria for selecting surgical procedures for bundled payment, contemplated various timeframes for bundles, requested and used Medicare data sets, and developed a methodology for analyzing the data. The addendum explains this entire process and the findings related to the two condition-specific procedure bundles that the GSCRC chose to examine: colon resection for cancer and mastectomy for cancer.

Surgeons and Bundled Payment Models: A Primer for Understanding Alternative Physician Payment Approaches may be accessed on the ACS members-only website using your ACS-issued username and password.

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