Acute, post-acute bundled payments are 'readily achievable,' report finds

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Current patient classification systems could form the basis of a successful bundled payment program for acute and post-acute care, according to a recently published article in the Medicare & Medicaid Research Review.

The research was conducted by a team from 3M Health Information Systems, and was funded by the Centers for Medicare & Medicaid Services.

The researchers analyzed 2006-2009 Medicare data, focusing on fee-for-service beneficiaries who were admitted to the hospital for certain conditions and completed a full 90-day post-acute period. This equaled about 851,000 Medicare payments.

In particular, the research team focused on Medicare Severity-Diagnosis Related Groups. MS-DRGs were implemented as a way to account for the severity of a hospital patient's condition, so that payments could be made to cover a patient's needed in-hospital services. The researchers considered whether MS-DRGs could also form the basis of bundled payments that include post-acute care.

MS-DRGs alone are not a particularly good basis for determining these bundled payments, they found. However, MS-DRGs used in conjunction with Clinical Risk Groups proved more stable. CRGs complement MS-DRGs by describing how chronic a patient's conditions are — an important consideration for post-hospital care.

“Essentially, the MS-DRGs are used to identify the reason for hospitalization and the ACRGs are used to differentiate patients in terms of their chronic disease burden,” the researchers wrote.

A bundled payment system based on MS-DRGs and CRGs has many potential advantages, which the report lists. For example, providers are already familiar with the MS-DRG system, making it a “readily understandable and clinically relevant” foundation for a new bundled payment program. There would also be few administrative feasibility issues, since the system would be based on data that is already routinely collected.

Further consideration must be given to how the system would deal with hospital readmissions during an episode of care, the researchers noted. However, this type of bundled payment system holds the promise of significant Medicare savings, and current health technology makes it “readily achievable,” they wrote.

Click here to access the complete report.