Washington, D.C. — The Center for American Progress, along with major leaders in the health policy community and physicians, issued a letter to Secretary of Health and Human Services Sylvia Burwell urging next steps on Medicare payment reform: additional mandatory bundled payment demonstrations. Signatories of the letter are: Dr. Ezekiel Emanuel, Dr. Don Berwick, Amitabh Chandra, Dr. Alice Chen, David Cutler, Dr. Bob Kocher, Peter Orszag, Dr. Kavita Patel, Jonathan Skinner, Neera Tanden, and Topher Spiro.
They write to the U.S. Department of Health and Human Services, or HHS:
In the remaining months of this administration, we urge you to initiate several additional mandatory bundled payment demonstrations. Additional mandatory demonstrations would send an important signal to stakeholders—hospitals, physicians, device manufacturers, skilled nursing facilities, and home health care agencies—that Medicare plans to aggressively expand bundled payments alongside other payment reforms.
The benefits of this approach are numerous. First, bundled payments can guarantee savings by providing a specific discount from fee-for-service payments. Second, because bundles are for specific treatments, they can deliver these savings over the short term—and evidence can be accumulated rapidly to justify nationwide expansion. Third, bundled payments can be implemented across all providers, in any geographic area.
A promising candidate for a mandatory bundled payment demonstration is one that targets cardiac procedures, such as coronary artery bypass grafting (CABG), stent placement, cardiac catheterization, pacemaker placement, and management of congestive heart failure. Results from the Acute Care Episode Program suggest that both providers and the Medicare program can realize savings and quality improvements by aligning hospital and physician interests and allowing both to share savings that result from delivery of high quality, more efficient care.
CAP has regularly called on Medicare to expand its successful bundled payment models, including the agency’s Acute Care Episode demonstration project. CAP has argued that expanding successful payment reforms is a critical tool for Medicare in its efforts to hold down health care costs and improve the quality of care for beneficiaries.
- Replace Fee-for-Service with Bundled Payments in Medicare by David M. Cutler, Zeke Emanuel, and Topher Spiro
- Controlling Costs by Expanding the Medicare Acute Care Episode Demonstration by Maura Calsyn and Zeke Emanuel
- Payment Reform Action Plan: Meeting the New Medicare Payment Reform Target by Zeke Emanuel, Allyson Schwartz, Topher Spiro, and Thomas Huelskoetter
- A Strategy for Medicare Payment Reform by Topher Spiro, Maura Calsyn, and Meghan O’Toole
For more information on this topic or to speak with an expert, contact Liz Bartolomeo at gro.ssergorpnacirema@oemolotrabl or 202.481.8151.