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Evaluating Opportunities in the Medicare Bundled Payment Program

Evaluating Opportunities in the Medicare Bundled Payment Program. Kelly Price, Senior Director DataGen Group Jonathan W. Pearce, CPS, FHFMA Principal, Singletrack Analytics. What’s happening?. BPCI open enrollment ended April 18 Hospitals will receive data this summer

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Evaluating Opportunities in the Medicare Bundled Payment Program

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  1. Evaluating Opportunities in the Medicare Bundled Payment Program Kelly Price, Senior Director DataGen Group Jonathan W. Pearce, CPS, FHFMA Principal, Singletrack Analytics.

  2. What’s happening? • BPCI open enrollment ended April 18 • Hospitals will receive data this summer • Need to make decisions by November SingleTrack/DataGen • Over 20 organizations from round 1 • Data partner to the AAMC convened hospitals and other "independent" awardees 

  3. Overview Program Rules • BPCI includes 48 episode “families” and 197 DRGs • Participating organizations can participate in any or all episode families • What criteria and analyses should be used for episode selection?

  4. Financial Opportunities

  5. Distribution of Episode Cost Individual Episodes

  6. Attacking High-Cost Cases Individual Episodes

  7. Moving the Cost Curve Down Individual Episodes

  8. Reducing Internal Hospital Costs • Part of the strategy for most • All of the strategy for some • Gainsharing waiver offers greater potential for savings • Length of Stay variation • But sometimes an extra day is good downstream • Device costs – not easy to analyze from the administrative data

  9. Total Financial Risk

  10. Intra-Episode Variation Coefficient of Variation = .57 Coefficient of Variation = .27

  11. Episode Risk Decreases with Population Size

  12. Hospital Discount as Percent of Hospital Cost • Episode average=$25,000 • Hospital portion=$10,000 • 2% * $25k=$500 • $500/$10,000=5%

  13. Hospital Discount as Percent of Hospital Cost • Target is discounted 2-3% of episode cost • Hospital frequently assumes the entire discount • Effective hospital discount depends on the hospital percentage of total episode cost

  14. Savings Opportunity is in Post-Acute Period It’s NOT here:

  15. Savings Opportunity • Percentage of cost in post-discharge period varies by DRG

  16. Clinical Coordination Opportunities

  17. Understanding the services

  18. Post Acute Cost Trends

  19. Post Acute Cost Variation by Provider

  20. Episode Costs by Admitting Physician

  21. Path of Care

  22. Analyses of Readmissions • Readmission DRG • Hospital of readmission • Timing of readmission • Post-acute provider from whom readmission originated

  23. Putting It All Together • Is there sufficient cost variation to create opportunities for savings • Are the drivers of variation actionable • Are your clinicians sufficiently involved to drive change

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