Are Bundled Payments Here to Stay?

CMS proposal would establish new payment model

Elizabeth Fassbender

On July 9, 2015, the Centers for Medicare & Medicaid Services (CMS) released a proposed rule to establish a new Medicare payment model for primary total hip and knee arthroplasty (THA, TKA) procedures performed in hospital inpatient settings. Under the proposal, hospitals would be accountable for all costs associated with the entire episode of care—from the time of surgery through 90 days after discharge. This new payment model applies to hospitals only, although physicians’ fees—as well as post-acute payments (such as to skilled nursing facilities)—will be included in calculating both the target price and the actual episode expense. Hospitals will be responsible for reconciling actual expenses with the target price.

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