Good morning, ProviderNation. Viva Las Bundled Payments: AHCA/NCAL honcho Mark Parkinson is keynoting a conference in Vegas on Monday, and he’s planning on telling them that—like it or not—bundled payments aren’t just coming, they’re here (and they’re staying).
Nothing says “Sin City” quite like the 2015 Healthcare Bundled Payments Congress, and Parkinson will take his audience through the latest in government plots to transcend the bad, old fee-for-service days. By 2016, the federal government wants at least 30 percent of Medicare payments to be made under alternative payment models. The percentage will rise to 50 by 2018, Parkinson will say.
“Our members and the association have been working hard to understand bundling and how it affects our profession,” Parkinson tells us in an emailed statement ahead of his speech. “Given the magnitude of this issue, and the slow but steady shifts toward bundling and other payment considerations, it’s important for us to take charge. I believe it will be vital for future success in the sector.”
Thousands of providers are already testing out new-fangled ways under the government’s Bundled Payments for Care Initiative, Parkinson says, and some of the results from the (admittedly small) samples are showing reductions in payments and lengths of stay.
Other models under the initiative have shown that the number of days in skilled nursing centers has dropped (from 21 to 16 days), as has the average Medicare payment to skilled nursing centers (from more than $12,000 per resident to less than $7,500).
What’s important, though, is that more than half of the providers who are in the initiative are only in Phase 1. Phase 2 of the project is when providers will have to start assuming risks (i.e., do good or be docked). Currently, there are only 61 skilled nursing centers in Phase 2, which means that the reality of the bundled payment future hasn’t really hit most providers.
As Parkinson sees it, there’s simply too much mass and energy behind bundled payments to stop its momentum (for instance, the Obama administration is barely two weeks out of taking a victory lap over its Pioneer accountable care organization model, which the government is now expanding on a national scale).
If all this sounds apocalyptic, cheer up. Parkinson says it’s unlikely that they’ll be any kind of comprehensive reform until after the IMPACT Act is fully implemented, in fiscal 2022. But he also says that providers have a real opportunity not to get ahead of the curve, but to shape it.
First, providers will have to join up with health networks and carve out the post-acute care niche, he says. “The key will be showing that you add value at low cost,” Parkinson says.
And, as things stand now, “hospitalizations are the hottest metric,” Parkinson says, which means that providers who can get their clients well, and quickly, will be in the proverbial catbird seat.
“To prosper,” Parkinson will tell his audience, “you’ll need to own your part of the bundle.”