Dan Mendelson, CEO of Avalere Health

A new analysis shows skilled nursing facilities make up two-thirds of providers participating in a bundled payment pilot program.

Research from Avalere shows that 1,755 providers will participate in “Phase 2” of the Centers for Medicare & Medicaid Services’ Bundled Payments for Care Improvement Initiative. An estimated 1,350 providers entered the second phase of the initiative by the July 1 deadline imposed by CMS; of those providers, 896 are SNFs. The second largest group participating in the pilot is physician group practices, at 197 participants.

The BPCI pilot tests healthcare providers’ ability to save money by bundling payments for certain conditions. At Phase 2 of the pilot, providers accept financial risk, and must cover extra charges if a patient’s treatment costs more than a pre-determined amount. While the number of providers accepting risk is growing, many also have opted out; the total number of providers entering Phase 2 is just 27% of those that originally expressed interest in the pilot program, Avalere found.

“Provider acceptance of risk is starting to transform clinical care at the provider level,” said Dan Mendelson, Avalere’s CEO.  “The focus on orthopedics and cardiovascular care in particular shows that this program is likely to generate lasting effects on quality and cost for Medicare beneficiaries.”

Providers selected which conditions they would test bundled payments on from a list of 48. The five most common conditions chosen are: major joint replacements, pneumonia and respiratory infections, chronic pulmonary disease, congestive heart failure, and sepsis.