Medicare Bundled Payment Pilot

(May, 2013) The Centers for Medicare and Medicaid Services announced in January that University of Colorado Hospital (UCH) and University Physicians Inc. (UPI) were selected to participate in its bundled payment pilot program.

The Bundled Payments for Care Improvement Initiative is designed to improve patient care by aligning incentives for providers. Under the pilot program, Medicare will make a single, predetermined payment to the hospital to cover all services furnished by the hospital, physicians and other practitioners during an inpatient stay.

Traditionally, Medicare makes separate payments to providers for each of the individual services they furnish, potentially resulting in fragmented care and rewarding quantity of services rather than quality.

The team from UCH and UPI worked for more than a year to develop, analyze and subsequently submit a pilot proposal for a bundled payment for congestive heart failure patients.

The pilot, led by Larry Allen, MD, and Christina Finlayson, MD, will be small, covering about 100 Medicare patients, but the planning team expects to transfer the learning to other reform initiatives as well as to all congestive heart failure patients at UCH.