The Centers for Medicare & Medicaid Services (CMS) recently announced the launch of a new voluntary bundled payment model called Bundled Payments for Care Improvement Advanced (BPCI Advanced). Under the new BPCI Advanced model, participants can earn additional payment if all expenditures for a beneficiary’s episode of care are under a spending target that factors in quality. The Model Performance Period for BPCI Advanced begins on October 1, 2018, when the current Bundled Payments for Care Improvement initiative expires, and runs through December 31, 2023.

BPCI Advanced will qualify as an Advanced Alternative Payment Model (Advanced APM) under the Quality Payment Program (QPP) created by the Medicare Access and Chip Reauthorization Act (MACRA).   The QPP has two tracks: the Merit-Based Incentive Payment System (MIPS) and Advanced APMs. Under Advanced APMs, providers take on financial risk to earn the Advanced APM incentive payment.

Under the BPCI Advanced model, provider payments will be based on quality performance during a 90-day episode of care. BPCI Advanced will initially include 32 different clinical episodes, such as major joint replacement of the lower extremity (inpatient) and percutaneous coronary intervention (inpatient or outpatient). A clinical episode will begin at the start of an inpatient admission to an acute care hospital, which CMS referred to as the “anchor stay,” or at the beginning of an outpatient procedure, the “anchor procedure.” The clinical episode will end 90 days after the end of the anchor stay or the anchor procedure. The clinical episodes may change in the future, as CMS may elect to revise them on an annual basis beginning Jan. 1, 2020.

CMS Administrator Seema Verma stated the following with respect to the program, “CMS is proud to announce this Administration’s first Advanced APM. BPCI Advanced builds on the earlier success of bundled payment models and is an important step in the move away from fee-for-service and towards paying for value. Under this model, providers will have an incentive to deliver efficient, high-quality care.”

Like all models tested by CMS, there will be a formal, independent evaluation to assess the quality of care and changes in spending under the model. Providers have until March 12 to apply for participation in the model. CMS will provide a second application opportunity for BPCI Advanced in January 2020.