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November 2024Lessons from a Bundled Care VBC Model
Because there are several value-based care (VBC) programs and evaluative reports available, it’s important to determine which ones hold lessons for otolaryngology, Dr. Harrill noted. One good place to start is CMS’s Bundled Payments for Care Improvement (BCPI) Advanced 5th Annual Report, which was released in June 2024 (https://www.cms.gov/priorities/innovation/innovation-models/bpci-advanced).
According to CMS, this is the first report assessing the BCPI model after significant changes were implemented in Model Year 4 (2021) to bolster care quality and savings. Initial results seem promising: according to the report, the program’s net savings in Model Year 4 ($464.7 million) were larger than the losses in Model Years 1 through 3 combined ($179.5 million in losses). But a glance at the report shows that none of the specialty procedures listed involve anything otolaryngologists do for patients. So, why is it worth the profession’s time to pay attention?
“The BCPI report makes it very clear that to effectively engage in bundled payments, you need a strong documentation and billing infrastructure for care pathway analysis and performance analytics based on these new VBC metrics,” he said. “That’s the best way to determine who is a high value-based performing physician and who is not.” The challenge, he noted, is that many physicians “don’t have access to total cost-of-care data to run these analyses and access this critical feedback and improve their individual performance curves.”
Help can come from one of two areas: being part of a health system that will run these VBC analytics systems for you or hiring a VBC “enabler” consultant if you are in an independent group practice. (VBC enablers help providers transition from fee-for-service into value-based payment models by providing wraparound technological, administrative, and clinical resources.) But Dr. Harrill offered a caveat on consultants: Some will suggest code stacking. “That’s not the right approach,” he said. A better method, he said, is to use codes strategically so that they are relevant to your patient, including the 80 or so hierarchical condition category (HCC) codes that are used for claims-based analysis in many VBC models. Since 2004, HCCs have been used by CMS as part of a risk-adjustment modeling that identifies individuals with serious acute or chronic conditions. “The ENT profession needs to begin to understand HCCs and how they fit into the VBC equation,” Dr. Harrill said.
Bundled Payments 2.0
As for whether ENT practices are ready for bundled payments today, “there’s two meanings to bundle payments that we need to understand,” he noted. “There are otolaryngologists doing procedural bundled payments right now.” These same-day bundles, he noted, pay one price for the procedure, facility fee, and ancillary care. “It’s a very common model that’s good for high-deductible plans such as employer plans that want to avoid wider spend variability.”
Once value-based concepts such as longitudinal risk-sharing get added to bundled care, however, that’s where things get complicated for otolaryngologists, Dr. Harrill noted. For procedures such as sinus surgery or tonsillectomy, there are limited variations in TCOC to manage. As a result, 90-day total cost-of-care bundled risk-sharing plans usually are not viable for otolaryngologists.
“If you did a bundled payment for tonsillectomy under a 90-day total cost-of-care liability, one hospital admission may blow out your entire profit margin for the year,” he said. “We know that Medicaid tried a tonsillectomy bundle payment program in several states about 15 years ago, and it was a disaster. Why? There’s not enough savings in the system for a bundle arrangement to accept total cost-of-care liability.”