90-Day Bundled Payment Simulation, Health Care Utilization, and Complications following Craniopharyngioma Resection in Adult Patients

Context Bundled payment and health care utilization models inform cost optimization and surgical outcomes. Economic analysis of payment plans for craniopharyngioma resection is unknown. Objective This study aimed to identify impact of endocrine and nonendocrine complications (EC and NEC, respectively) on health care utilization and bundled payments following craniopharyngioma resection. Design This study is presented as a retrospective cohort analysis (2000–2016) with 2 years of follow-up. Setting The study included national inpatient hospitalization and outpatient visits. Patients Patients undergoing craniopharyngioma resection were divided into the following four groups: group 1, no complications (NC); group 2, only EC; group 3, NEC; and group 4, both endocrine and nonendocrine complications (ENEC). Interventions This study investigated transphenoidal or subfrontal approach for tumor resection. Main Outcome Hospital readmission, health care utilization up to 24 months following discharge, and 90-day bundled payment performances are primary outcomes of this study. Results Median index hospitalization payments were significantly lower for patients in NC cohort ($28,672) compared with those in EC ($32,847), NEC ($36,259), and ENEC ($32,596; p < 0.0001). Patients in ENEC incurred higher outpatient services and overall median payments at 6 months (NC: 38,268; EC: 49,844; NEC: 68,237; and ENEC: 81,053), 1 year (NC: 46,878; EC: 58,210; NEC: 81,043; and ENEC: 94,768), and 2 years (NC: 58,391; EC: 70,418; NEC: 98,838; and ENEC: 1,11,841; p < 0.0001). The 90-day median bundled payment was significantly different among the cohorts with the highest in ENEC ($60,728) and lowest in the NC ($33,089; p < 0.0001). Conclusion ENEC following surgery incurred almost two times the overall median payments at 90 days, 6 months, 1 year. and 2 years compared with those without complications. Bundled payment model may not be a feasible option in this patient population. Type of complications and readmission rates should be considered to optimize payment model prediction following craniopharyngioma resection.

Managing the economic challenges in the treatment of heart failure

Background Treatment of heart failure is complex and inherently challenging. Patients traverse multiple practice settings as inpatients and outpatients, often resulting in fragmented care. The Center for Medicare and Medicaid Services is implementing payment programs that reward delivery of high-quality, cost-effective care, and one of the newer programs, the Bundled Payment for Care Improvement Advanced program, attempts to improve the coordination of care across practices for a hospitalization episode and post-acute care. The quality and cost of care contribute to its value, but value may be defined in different ways by different entities. Conclusions The rapidly changing world of digital health may contribute to or detract from the quality and cost of care. Health systems, payers, and patients are all grappling with these issues, which were reviewed at a symposium at the Heart Failure Society of America conference in Philadelphia, Pennsylvania on September 14, 2019. This article constitutes the proceedings from that symposium.

The Effect of Hospital Safety Net Status on the Association Between Bundled Payment Participation and Changes in Medical Episode Outcomes

BACKGROUND: Under Medicare’s Bundled Payments for Care Improvement (BPCI) program, hospitals have maintained quality and achieved savings for medical conditions. However, safety net hospitals may perform differently owing to financial constraints and organizational challenges. OBJECTIVE: To evaluate whether hospital safety net status affected the association between bundled payment participation and medical episode outcomes. DESIGN, SETTING, AND PARTICIPANTS: This observational difference-in-differences analysis was conducted in safety net and non–safety net hospitals participating in BPCI for medical episodes (BPCI hospitals) using data from 2011-2016 Medicare fee-for-service beneficiaries hospitalized for acute myocardial infarction, pneumonia, congestive heart failure, and chronic obstructive pulmonary disease. EXPOSURE(S): Hospital BPCI participation and safety net status. MAIN OUTCOME(S) AND MEASURE(S): The primary outcome was postdischarge spending. Secondary outcomes included quality and post–acute care utilization measures. RESULTS: Our sample consisted of 803 safety net and 2263 non–safety net hospitals. Safety net hospitals were larger and located in areas with more low-income individuals than non–safety net hospitals. Among BPCI hospitals, safety net status was not associated with differential postdischarge spending (adjusted difference-in-differences [aDID], $40; 95% CI, –$254 to $335; P = .79) or quality (mortality, readmissions). However, BPCI safety net hospitals had differentially greater discharge to institutional post–acute care (aDID, 1.06 percentage points; 95% CI, 0.37-1.76; P = .003) and lower discharge home with home health (aDID, –1.15 percentage points; 95% CI, –1.73 to –0.58; P < .001) than BPCI non–safety net hospitals. CONCLUSIONS: Under medical condition bundles, safety net hospitals perform differently from other hospitals in terms of post–acute care utilization, but not spending. Policymakers could support safety net hospitals and consider safety net status when evaluating bundled payment programs.

Preparing for Participation in the Centers for Medicare and Medicaid Services’ Bundle Care Payment Initiative – Advanced (BPCI-A) for Major Bowel Surgery

BackgroundAs healthcare costs rise, there is increasing emphasis on alternative payment models to improve care efficiency. Bundled payment represents an alternative reimbursement model gaining popularity within the surgical sphere. We aimed to assess where the largest opportunities for care improvement lay and how best to identify patients at high-risk of suffering costly complications.MethodsWe utilized itemized CMS claims data for a historical group of 252 bundled payment patients and performed a cost analysis to identify opportunities for improved care efficiency. Based on the results of this cost analysis, we identified readmissions as a target for improvement. We then assessed whether the ACS NSQIP surgical risk calculator could accurately identify patients within our bundled payment population who were at high-risk of readmission using a logistic regression model.ResultsReadmissions accounted for 12.8% of the average total care episode cost with a coefficient of variation of 2.72, thereby representing the most substantial, non-fixed cost for our bundled payment patients. Patients readmitted within their 90-day care episode were 2.53 times more likely to be high-cost (>$60,000) than patients not readmitted. However, the ACS NSQIP surgical risk calculator did not accurately predict patients at high-risk of readmission within the first 30-days with an AUROC of 0.58.ConclusionsOur study highlights the importance of reducing readmissions as a central component to improving care for bowel surgery bundled payment patients. Preventing such readmissions requires accurate identification of patients at high-risk of readmission; however, current risk prediction models lack the adaptability necessary for this task.

VOLUNTARY Regulation: Evidence from Medicare Payment Reform

Government programs are often offered on an optional basis to market participants. We explore the economics of such voluntary regulation in the context of a Medicare payment reform, in which one medical provider receives a single, predetermined payment for a sequence of related healthcare services, instead of separate service-specific payments. This “bundled payment” program was originally implemented as a five-year randomized trial, with mandatory participation by hospitals assigned to the new payment model; however, after two years, participation was made voluntary for half of these hospitals. Using detailed claim-level data, we document that voluntary participation is more likely for hospitals that can increase revenue without changing behavior (“selection on levels”) and for hospitals that had large changes in behavior when participation was mandatory (“selection on slopes”). To assess outcomes under counterfactual regimes, we estimate a stylized model of responsiveness to and selection into the program. We find that the current voluntary regime generates inefficient transfers to hospitals, and that alternative (feasible) designs could reduce these inefficient transfers and raise welfare. Our analysis highlights key design elements to consider under voluntary regulation.

Contracts to Coordinate Healthcare Providers in the Telemedicine Referral System

With the help of telemedicine, healthcare providers can increase patients’ access to high-quality services while reducing the medical expenditure, especially for patients in remote areas. Once advanced care is needed, local patients will first be referred to an online health service and then be referred to the offline hospital if the online healthcare fails. In practice, local community hospitals and the advanced tertiary hospitals generally lack financial incentives to exert costly, but non-reimbursable, effort to avoid poor patient outcomes. Therefore, we build a new model to analyze the interaction between these two service providers, promoting them to exert the right effort by designing payment contracts. Our results show that neither fee-for-service nor bundled payment contracts can achieve the social optimum. Tertiary hospitals always exert less effort than the socially-optimal effort while the community hospital may exert less or more effort depending on the online treatment cost. Then, we propose a performance-based bundled payment contract that can coordinate both hospitals’ decisions to achieve socially optimal outcomes. Finally, we numerically show the impact of the referral service fee and the online treatment cost on the efficiency of these contracts.