The Comprehensive Care for Joint Replacement (CJR) model is a bundled payment model in which 799 participating hospitals from 67 metropolitan statistical areas are required to participate. The first CJR reconciliation for Payment Year 1 (PY1) was completed in spring 2017. This paper by Milliman’s Pamela Pelizzari, Jocelyn Lau, and Harsha Mirchandani combines data from the report of PY1 results and other publicly available sources to compare hospitals that received payments in CJR PY1 to those that did not.
With the shift to value-based payment for healthcare in the United States, an array of alternative payment models (APMs) has emerged that introduce challenges along with opportunities for providers. This paper by Milliman consultants highlights the key aspects of APM payment methodologies and uses the Centers for Medicare and Medicaid Services Oncology Care Model as a case study to illustrate these concepts.
Alternative payment models (APMs) have become a popular way to tie payment to quality of care. The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) created incentives for providers to participate in APMs. This paper by Daniel Muldoon and Pamela Pelizzari explores key clinical and financial considerations that need to be addressed in a robust APM proposal.
Policymakers sometimes point to Medicare premium support programs as a possible cost-reduction solution for the federal health insurance program. In this article, Milliman’s Catherine Murphy-Barron and Pamela Pelizzari discuss some of the key financial and insurance issues involved in premium support proposals for Medicare Part A and Part B. The authors also explore the potential advantages and disadvantages of such an approach.
Here is an excerpt from the article:
A premium support model has the potential to fundamentally change the way Medicare benefits are provided to eligible individuals. Such a model would substantially influence both beneficiary and federal spending far into the future.
Financially, the possible implications of some premium support models have been scored by the Congressional Budget Office (CBO) to demonstrate the level of savings or costs to the federal government and affected beneficiaries. Under the options examined, the CBO found that net federal spending for Medicare would decrease in 2024 relative to current law by $84 billion (a 9% decrease) in the second-lowest-bid option (where the federal contribution is set at the second-lowest bid), and by $41 billion (a 4% decrease) in the average-bid option (where the federal contribution is set at the average bid). However, it is worth noting that the CBO projected an increase in spending by beneficiaries on their own premiums and care in the second-lowest-bid option.8
From a beneficiary perspective, the design of any premium support model would be under pressure to demonstrate that beneficiaries would have access to comprehensive coverage for an affordable price. Without sufficient information on the similarities and differences among various plans, beneficiaries may be at a disadvantage in terms of their ability to identify plans that best meet their needs. Financially, beneficiaries are at risk of incurring an increasing percentage of the cost of these plans if the federal contribution is less than the cost of the plans. In the second-lowest bid option that was scored by the CBO, beneficiaries’ spending was projected to increase by 18% (including both premiums and other out-of-pocket costs) in 2024 relative to the amount projected under current law, which represents a substantial increase in out-of-pocket costs for the same level of care.9
The Centers for Medicare and Medicaid Services released final rules related to episode payment models on January 3, 2017, and May 19, 2017. This paper by Milliman consultants Pamela Pelizzari and Daniel Muldoon outlines the major provisions of the final rules and suggests possible implications for affected providers.
The major terms and conditions of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) are becoming more well-known during the first performance year, but some aspects of the new physician payment system law still can be elusive for physician practices and other healthcare organizations. In this article, Milliman’s Pamela Pelizzari discusses details that may be overlooked regarding participation in the Merit-based Incentive Payment System track and the advanced alternative payment model track of MACRA.
This article was published by the Healthcare Financial Management Association.