On Friday, May 17, 2013, CMS announced that its Center for Medicare and Medicaid Innovation Center (Innovation Center) is providing an open period for additional organizations to be considered for participation in Model 1 of the Bundled Payments for Care Improvement Initiative (BPCI Model 1).  Interested organizations have until July 31, 2013 to submit the Model 1 Open Period Information Intake form. 

Section 3021 of the Affordable Care Act authorized CMS to implement demonstrations under Section 1115A of the Social Security Act for purposes of testing innovative payment and service delivery models that reduce spending under Medicare, Medicaid, or the Children’s Health Insurance Program (CHIP), while at the same time preserving or enhancing quality of care.  The Innovation Center is testing four episode-based payment models.  For a discussion of all four models being tested by the Innovation Center, see the March 29, 2011 Health Headline entitled “CMS Announces it is Accepting Applications for a ‘Bundled Payment for Care Improvement Initiative,’” here.

BPCI Model 1 focuses on the inpatient episode of care in the acute care hospital setting.  Medicare will pay the hospital a discounted amount based on the payment rates established under the Inpatient Prospective Payment System (IPPS) used in the original Medicare program.  Physicians will continue to be paid separately for their services under the Medicare Physician Fee Schedule.  Under certain circumstances, hospitals and physicians will be permitted to share gains arising from the providers’ care redesign efforts.  

Participation in BPCI Model 1 began in April 2013 following submissions received in response to a Request for Application posted by the Innovation Center in August 2011.  The Innovation Center is now allowing additional acute care hospitals paid under IPPS and organizations that wish to convene acute care hospitals in a facilitator convener role to submit the “Model 1 Open Period Information Intake” form until July 31, 2013.  CMS will review the information submitted and screen organizations for suitability for participation in BPCI Model 1. 

For more information, click here to access a copy of CMS’s May 17, 2013 Notice. 

Reporter, Tracy Weir, Washington, D.C., +1 202 626 2923, tweir@kslaw.com.