Six Key Points About the Orthopedic Bundled Payments Initiative

Health Care

January 26, 2016
by Kimberly Heller, CPA, CMA, LNHA

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Kimberly Heller Kimberly Heller, CPA, CMA, LNHA

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The Centers for Medicare & Medicaid Services (CMS) and the federal government are working hard to ensure current and future Americans have access to high-quality health care and those same Americans don’t go to the “poor house” because of the current unsustainable health care system. Two critical challenges are the financial burden health care places on preretirement Americans and our predicted inability to provide health care for seniors after 2030.
The Medicare Part A Trust Fund (which pays for inpatient hospital, skilled nursing facility (SNF), hospice, and home health agency (HHA) services) is expected to become insolvent in 2030. This is unchanged from 2014 predictions but slightly better than insolvency predictions in 2011-2013.
In addition to the predicted Medicare program insolvency, health care places a huge burden on the average American during their working years. According to CMS, the average American spent $9,600 on health care in 2014, up significantly from $7,700 in 2007. Health care spending is expected to exceed $10,000 per person in 2016 and reach $14,900 in 2023. This is an important deterrent to U.S. economic growth.
The Comprehensive Care for Joint Replacement model (a.k.a. “orthopedic bundled payments”) being rolled out by the Center for Medicare and Medicaid Innovation is designed to determine if bundling payments for orthopedic services will reduce Medicare expenditures while preserving or enhancing the quality of care for Medicare beneficiaries. CMS expects this initiative to result in savings to the Medicare program of $343 million over the five performance years of the model.
Hospitals, physicians, SNFs, and HHAs need to understand the orthopedic bundled payments initiative. In this four-part article series, we will cover key aspects of the orthopedic bundled payments initiative in greater detail.

Continue reading article #1 to learn about six key points related to the orthopedic bundled payment initiative.

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