Your questions about BPCI Advanced–answered

On January 9, 2018, CMS announced BPCI Advanced as a voluntary bundled payment program that will qualify for the Advanced Alternative Payment Model (APM) 5% bonus under MACRA (Medicare Access and CHIP Reauthorization Act of 2015). While the Center for Medicare and Medicaid Innovation (CMMI) is providing significant flexibility under this model, this flexibility adds additional complexity as organizations try to determine if and how they should apply on a very abbreviated timeline (Applications are due March 12).

To help you understand some of the more specific nuances of this program, we’ve put together some frequently asked questions. Please note that we’ll continue to update this page with new questions and answers so please continue to check back on this page for more details. Additionally, CMMI has created its own FAQ page and continues to add new materials to the BPCI Advanced program homepage.

You can also access a recording of our recent webconference on BPCI Advanced here.

1. What is BPCI Advanced and when will it be implemented?

BPCI Advanced is a voluntary bundled payment program that includes 29 different inpatient bundles (“clinical episodes”) and three outpatient clinical episodes. The program is set to begin on October 1, 2018 and participants cannot add or drop Clinical Episodes until January 1, 2020. The program is set to run until 2023 ("six performance years" although Year 1 will only be three months long).

2. What is the time frame to apply?

It's very short. Interested organizations must submit a non-binding application by March 12, 2018. CMMI expects to provide target prices to applicants in May of 2018. Participants must finalize their episode selection and sign their participation agreement in August of 2018.

3. What are the 29 inpatient clinical episodes and 3 outpatient clinical episodes?

Joint and Spine:

  • Double joint replacement of the lower extremity
  • Major joint replacement of the lower extremity
  • Major joint replacement of the upper extremity
  • Fractures of the femur and hip or pelvis
  • Hip & femur procedures except major joint
  • Lower extremity/humerus procedure except hip, foot, femur
  • Spinal fusion (non-cervical)
  • Cervical spinal fusion
  • Combined anterior posterior spinal fusion
  • Back and neck except spinal fusion

Cardiology:

  • Cardiac arrhythmia
  • Cardiac defibrillator
  • Cardiac valve
  • Pacemaker
  • Percutaneous coronary intervention
  • Coronary artery bypass graft
  • Congestive heart failure
  • Acute myocardial infarction

Pulmonary Services:

  • Simple pneumonia and respiratory infections
  • COPD, bronchitis, asthma

Nephrology

  • Renal failure
  • Urinary tract infection

Gastroenterology:

  • Gastrointestinal hemorrhage
  • Gastrointestinal obstruction
  • Major bowel procedure
  • Disorders of the liver excluding malignancy, cirrhosis, alcoholic hepatitis (Only episode that was not an option in the original BPCI)

Other Inpatient Clinical Episodes:

  • Cellulitis
  • Sepsis
  • Stroke

Outpatient Clinical Episodes:

  • Cardiac Defibrillator
  • Percutaneous coronary intervention
  • Back and neck except spinal fusion

4. How will this interact with BPCI if I’m a current participant?

It won’t. BPCI is set to end on September 30, 2018 and this program will begin on October 1, 2018.

5. If I apply to BPCI Advanced, do I have to join – in other words, can I drop my application after I receive target price information?

Applications are non-binding and you do not have to participate. The selection of clinical episodes happens over the summer (Price targets will be available around May and applications must be signed by August), and if an applicant decides not to join, CMS will not impose penalties. If a participant wants to withdraw an application before it is signed (or remove Participating Practitioners or Episode Initiators), they should submit a written request on letterhead to BPCIAdvanced@cms.hhs.gov with the following information:

  • Applicant Organization’s legal name and any “doing business as” name
  • Applicant identification Number provided by CMS
  • Address and point of contact information
  • Exact description of the nature of the withdrawal (i.e., withdrawal of the entire application or removal of individual providers)

6. Can I add participants after March 12?

No. I wouldn’t count on it. CMS on a webinar said that you will not be able to add Episode Initiators after you submit your application on March 12 (likely due to data processing constraints in determining Target Prices). The next opportunity to add new Episode Initiators will be January 1,2020.

7. Can Advisory Board assist with my application and BPCI Advanced strategy?

Yes! While not included in your research membership, our value-based care consulting team is able to support organizations with every phase of BPCI Advanced from initial strategy, application writing and submission, go/no-go financial modeling, NPRA sharing distribution model creation and implementation of initiatives designed to improve performance such as clinical variation reduction and post-acute network development.

Connect with one of our value-based care consulting experts

8. If I am participating in joint replacement bundles as part of CJR (Comprehensive Care for Joint Replacement), can I participate in BPCI Advanced for other bundles?

Yes. While you will not be able to participate in the Major joint replacement of the lower extremity bundle (for MS-DRGs 469-470), there are nine other Joint and Spine bundles you can participate in (see above).

9. How does BPCI Advanced interact with Medicare ACO Programs such as the Medicare Shared Savings Program?

Hospitals and clinicians may concurrently participate in BPCI Advanced and the Medicare Shared Savings Program, the Next Generation ACO Model, and other shared savings initiatives. However, patients attributed to certain ACO models with prospective attribution and significant risk will be excluded from BPCI Advanced’s clinical episodes (Patients attributed to the following models will be excluded:

  1. Next Generation ACO
  2. Vermont All-payer ACO
  3. ESRD Seamless Care Organization
  4. Shared Savings Program ACO participating under Track 3)

Patients attributed to Track 1, Track 1+ and Track 2 of the Medicare Shared Savings Program will be included in BPCI Advanced.

If you’re in Track 1 of the Medicare Shared Savings Program (or thinking about joining for next year), BPCI Advanced could complement your existing strategy by providing a path to the 5% APM Bonus for some specialists and ensuring the rest of your physician partners (especially primary care physicians) are scored under the MIPS APM Scoring Standard available through Track 1.

10. How does qualification for the APM track work under BPCI Advanced and how should this impact how we apply to the program?

This depends in many ways on the composition of your organization. In order to be eligible for the APM bonus in 2019, the qualifying threshold is having 50% of Medicare FFS revenues furnished to Medicare FFS beneficiaries that are attributed to the APM (or have 35% of patients attributed to the APM). Depending on how you apply for the program, CMS will determine qualification at either the individual or group level. The biggest risk with group level qualification is that a physician group may have physicians in the group with a relatively low proportion of patients attributed to BPCI Advanced (or the group may partner with a convener that brings together physicians with low volumes in BPCI Advanced) and their overall % of revenues or % of patients in the APM might fall below the qualifying threshold. In this case, the entire group would miss out on the 5% APM bonus. Having this calculation at the individual clinician level may be especially favorable for multi-specialty group groups or those where clinicians split cases at multiple different hospitals.

If an application includes hospital participants, the APM qualification (“QP Determination”) calculation will be done at the individual clinician level based on physicians listed as NPRA sharing partners and will likely also include physicians employed by the hospital Participant. If an application includes a Physician Group Practice, CMS will perform the APM qualification calculation at the group level for all those PGPs included in the application.

What is included in the numerator and denominator for the QP determination calculations?

This is an area where CMS could provide more BPCI Advanced-specific guidance, but this has been addressed in the MACRA final rule and elsewhere. In general, CMS will not include payment amounts and patient counts that are categorically impossible to be in the numerator from the denominator. The denominator will only include patients that were attributable to BPCI Advanced. In a worst case scenario, this definition means patients with a discharge for the 29 inpatient clinical episodes or 3 OP episodes….while not yet confirmed, this is likely to be narrowed down to only the episodes you’re participating in. The numerator will be the Medicare Part B services provided to attributed patients during the 90 day episode. Here’s the language CMS used in the MACRA final rule:

  • Numerator: “In episode payment models, because a beneficiary is considered attributed during the course of an episode, the payments included in the numerator for this calculation are those for Medicare Part B covered professional services furnished to an attributed beneficiary by eligible clinicians in the Advanced APM Entity during the course of an episode.”
  • Denominator: “In episode payment models, the payments included in the denominator for this calculation as proposed would be those for Medicare Part B covered professional services furnished to any attribution-eligible beneficiary by eligible clinicians in the Advanced APM Entity. This would include all such services to all attribution-eligible beneficiaries whether or not such services occur during the course of an episode under the Advanced APM.”

12. As a convener, can I customize the episodes each Participant participates in?

Yes. On a webinar on January 30, 2018, CMS indicated that applicants will be able to customize which episodes each Episode Initiator participates in before they sign their final participation agreement in August. Organizations with multiple hospital participants will be able to customize which episode each hospital chooses to initiate. Similarly, organizations with multiple PGPs will be able to select which episodes each PGP chooses to initiate. A big caveat is that opting-in/opting-out of episodes at the individual physician level will not be allowed and every potential Episode Initiator within a PGP will be included.

13. What is NPRA?

NPRA stands for Net Payment Reconciliation Amount. This is the amount paid to a Participant or Convener by CMS for having episodic costs lower than the target price and can be shared with NPRA Sharing Partners.

14. Can Internal Cost Savings (ICS) be shared under this model?

It’s not entirely clear. CMS has said that they are limited in their ability to respond to this question because they are waiting to hear back regarding waivers that should be granted and available starting 10/1. We would love to be wrong here, but CMS has not provided enough definitive information to plan strategies around inclusion of Internal Cost Savings (ICS). We believe the safest approach is to assume there are no special waivers under this program for ICS and to only share ICS under existing safe harbors such as co-management or a Hospital Efficiency Improvement Program (HEIP). While we do not believe BPCI Advanced program should impact any existing gainsharing on non-Medicare patients or for non-BPCI Advanced Medicare discharges, you’ll need to be careful that you aren’t rewarding providers twice (for example, make sure that they’re not getting paid out twice for initiatives that result in savings under BPCI Advanced as well as under HEIP).

The only mention of ICS in the Request for Application, was related to how NPRA Sharing Partners could contribute their own ICS to fund the BPCI Advanced Savings Pool “BPCI Advanced Savings Pool – A collection of funds maintained by a Participant, or a BPCI Advanced Entity on the Participant’s behalf, that consists solely of: (1) contributions by NPRA Sharing Partners of the NPRA Sharing Partners’ own Internal Cost Savings and Shared Repayment Amounts; and (2) contributions by the Participant of NPRA payments received by the Participant from CMS. Funds maintained in the BPCI Advanced Savings Pool may be distributed pursuant to the BPCI Advanced Model Participation Agreement as either NPRA Shared Payments to NPRA Sharing Partners or as payment for Administrative Services actually furnished by a BPCI Advanced Entity.”

15. How does the Composite Quality Score (CQS) impact repayment or reconciliation?

Once all the positive and negative reconciliation amounts are calculated (the aggregate overage and underage compared to Target Price), a participant will have either a Total Reconciliation Amount or a Total Repayment Amount. CMS will then adjust the amount by the participant’s CQS. The cap on the adjustment is 10% in the first two years of the program. If a participant has a Total Reconciliation Amount, the CQS will determine if they receive between 90 to 100% of that amount as the Adjusted Reconciliation Amount. If the participant has a Total Repayment Amount, the CQS will determine if the Adjustment Repayment Amount is between 90-100% of the Total Repayment Amount. The Adjusted Reconciliation or Repayment amount is then applied against a 20% stop gain or stop loss limit to determine the amount of reconciliation payment CMS owes to the participant or the amount of repayment the participant owes to CMS.

16. What quality measures must be reported as part of BPCI Advanced?

The initial BPCI Advanced program requires performance evaluation on seven claims-based measures. Since the performance will be calculated directly from information submitted on Medicare billing and claims forms, additional direct measure reporting to CMS is not required. However, the utilization of some claims-based measures will require both hospitals and providers to ensure their billing and claims data accurately reflect care and quality improvement activities by including non-billable CPT-II quality codes so they get full credit on these measures. The specific documentation elements required for performance vary significantly by measure and by EMR, so we recommend a careful examination of your current documentation and billing/coding workflows for claims-based reporting (especially for these two measures: Advanced Care Plan (NQF #0326) and Prophylactic Antibiotic (NQF #0268)). The initial seven program measures are below:

  1. All-cause Hospital Readmission Measure (NQF #1789)
  2. Advanced Care Plan (NQF #0326)
  3. Perioperative Care: Selection of Prophylactic Antibiotic: First or Second Generation Cephalosporin (NQF #0268)
  4. Hospital-Level Risk-Standardized Complication Rate (RSCR) Following Elective Primary Total Hip Arthroplasty (THA) and/or Total Knee Arthroplasty (TKA) (NQF #1550)
  5. Hospital 30-Day, All-Cause, Risk-Standardized Mortality Rate (RSMR) Following Coronary Artery Bypass Graft Surgery (NQF #2558)
  6. Excess Days in Acute Care after Hospitalization for Acute Myocardial Infarction (NQF #2881)
  7. AHRQ Patient Safety Indicators (PSI 90)

17. If you are already successful in episodic cost management, how challenging will it be to be successful under BPCI Advanced?

Without seeing your Target Price and how your performance compares to your peers, it is difficult to tell. CMS will base target prices on hospital providers’ historic claims data. In the case of PGP participants, their target price is based on the hospital where the anchor stay or procedure takes place. CMS has said that pricing will account for regional spending trends, but the extent of the adjustment is not yet defined. Therefore, participants who are already strong in episodic cost management may be at a disadvantage, but it is impossible to know for sure. We encourage interested providers to pay close attention to any additional information CMS provides and, if they apply, to also include a completed Data Request and Attestation Form in order to see the historic claims data that form the basis of your target price calculation.

18. Can you tell me more about the target price methodology?

CMS will publish additional information “in the next few weeks”, but here is what we know so far:

  • Target Prices for Hospitals: Targets will factor in past performance, characteristics of patients served by the hospital and performance compared to the hospital’s “peer group”. The patient characteristic adjustment will be based on a combination of CMS’s HCC Risk Adjustment model, demographic factors like age and sex, case mix index/severity by MS-DRGs included in the episode as well as other factors. The hospital’s “Peer Adjusted Trend Factor” or “PAT Factor” will be based on which of the nine census regions the hospital is in (see below), whether they are urban or rural and hospital size and potentially other factors.
  • Target prices for PGPs: PGPs will receive hospital-specific prices for each episode adjusted for their historical efficiency relative to the hospital and their case mix index relative to the hospital’s case mix.

19. With a mandatory 3% discount of a target price and down-side risk, why would anyone want to participate?

  1. While organizations must take a 3% discount off their Target Price, this price is based off of historical costs compared to peers and it’s possible that current costs are lower than your target price. In this case, you would be in a favorable position to be rewarded for your past efforts at improving care post discharge.
  2. It’s also important to remember this a 3% discount off of total 90 day episodic costs and not the reimbursement related to just a hospital’s DRG payment or a physician’s payment for the procedure. There is tremendous waste and inefficiency post discharge in terms of readmission and overuse of post-acute providers and CMS is trying to offer an incentive to reduce this variation.
  3. Finally, as discussed above, physician participants in BPCI Advanced may be eligible for a 5% bonus on all of their Medicare fee-for-service physician fees which could be a significant reward.

20. We have a free-standing surgery center with a separate license from the hospital, can they initiate episodes?

No. Ambulatory surgery centers will not be included. CMS is only allowing episodes to be initiated based on inpatient stay or outpatient procedure.

21. Can I submit multiple applications to give myself flexibility?

Yes, but conflicts must be resolved by August 2018. As an example, a hospital with employed medical group could submit an application as just the hospital, as just the employed PGP, as both the hospital and PGP on one application, with their ACO as a convener, or as part of a nationwide convener’s application.

22. What is the baseline period for the target prices?

The baseline period is a four-year period from January 1, 2013 through December 31, 2016.

23. Will CMS provide claims data to help make our decision on which bundles to participate in?

Yes, but only if you request it as part of your application by submitting a Data Request and Attestation (DRA). You can request both aggregate historical and/or detailed claims level data. Organizations unused to processing claims level data may struggle to process it internally and may want to proactively reach out to vendors capable of processing this data and making financial projections. For example, we have a team of actuaries working with organizations to prepare financial analyses to determine which bundles they should pursue as soon as claims data is available in May.

More resources for improving episodic efficiency

Learn about other bundled payment programs and how post-acute care relates to episodic cost management, by visiting The Episodic Efficiency Resource Suite.

Learn more

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