Will Bundled Payments Lower Costs?

bundled-costsThe Centers for Medicare and Medicaid Services (CMS) began their initiative to tie payments to quality or value earlier this year by implementing their Comprehensive Care Joint Replacement Model (CJR). The mandatory program holds hospitals accountable for all costs, processes and outcomes associated with hip and knee replacements performed on Medicare patients. Since hip and knee replacements are the most common inpatient surgeries for seniors, the CJR model is expected to serve as a critical test to determine whether bundles can help control costs and increase quality.

The quality of treatment and aggregate spending for a 90-day period, including surgery, recovery and rehabilitation will determine whether the hospital owes money or will receive additional payment from Medicare. CMS is establishing specific bundled pricing for each provider, then using data to determine regional pricing after five years.

Looking Outside the Walls

This model is forcing hospitals to evaluate overall care for joint replacements since clinical and financial success requires coordination between hospitals and post-acute care providers such as skilled nursing facilities. While joint replacements may represent only a portion of a hospital’s revenue, the Medicare Star Rating System tied to CJR will make provider performance public. Low performance will make it difficult to compete for Medicare-funded joint replacements in the future and many think that if bundling shows positive results, CMS will likely look to other areas of care.

why-diversified-group

2017 Medicare Second Payer Questionnaire

Dear Valued Client,

The Centers for Medicare and Medicaid Services (CMS) requires health plans and their contract administrators who process claims for the Plan to keep accurate records as to the Plan’s secondary payer status to Medicare and to report this information to CMS with respect to all Medicare eligible employees and beneficiaries (spouses and dependents) enrolled in the Employer’s group medical and prescription drug coverage.

In order for Diversified to properly report and determine whether your health plan is primary or secondary to Medicare, we need you to complete and return the attached the Medicare Second Payer (MSP) Plan Questionnaire by February 1, 2017.

Click here to download the MSP Plan Questionnaire.  Please fax the completed MSP Questionnaire to: (860) 295-0340, Attn: Account Executive.

Should you have any questions, please contact your Account Executive at (888) 322-2524.

Thank you in advance for your assistance.