BPCI Advanced Model Extension

CMS recently made several major announcements about the Bundled Payments for Care Improvement Advanced Model. 

• The model, which was due to expire at the end of 2023 (Model Year 6), will be extended for an additional two years through Dec. 31, 2025. 
• New applications will be accepted in 2023 for the two-year extension. Participants still active in Model Year 6 can continue without reapplying by signing an amended and restated participation agreement for Model Year 7. 
• New methodological changes will be implemented for Model Year 6, which starts on Jan. 1, 2023. Methodological changes include that:
  • the CMS Discount Factor for medical clinical episodes will be reduced from 3% to 2%; 
  • the Peer Group Trend Factor Adjustment cap for all clinical episodes will be reduced from 10% to 5%;
  • the Major Joint Replacement of the Upper Extremity clinical episode category will become a multi-setting episode category by allowing episodes to be triggered when the procedure is performed in the hospital outpatient setting. All episodes under this clinical episode category will include additional adjustments to account for trauma and fractures; and
  • episodes that co-occur with a COVID-19 diagnosis will no longer be excluded from the model; however, the pricing methodology will include risk adjustment for when a beneficiary has a COVID-19 diagnosis during the episode. 

What do these changes mean for the BPCIA model?

Enrollment in the BPCIA model has declined over the last several years due to the expansion of risk to entire clinical episode service line groups and complex pricing methodology changes making financial goals more difficult to attain. These challenges have included the exit of major large conveners and their cohorts of downstream episode initiators. Under the new two-year extension, providers that previously participated in BPCIA will have the opportunity to reapply and providers who have not yet participated will have an opportunity to get involved. BPCIA has not had an open enrollment period since Model Year 3 in 2019 (calendar year 2020). 

New pricing methodology changes are a step in the right direction to retain enrollment of existing providers and encourage the application of non-participating providers. These changes will favor participants by reducing uncertainty in target prices, particularly as it concerns the Peer Group Trend Factor Adjustment. The inclusion of episodes when a beneficiary has a COVID-19 diagnosis will boost episode volume. It also includes fair additional risk adjustment to account for changes in episode expenditures due to the presence of a COVID-19 diagnosis. In addition, participants currently at risk for medical clinical episode categories will have higher target prices. 

There have been growing concerns about CMS’ ability to evaluate the effectiveness of this model since substantial changes in participation may result in selection bias. CMS will be able to better evaluate the impact of BPCIA by making these changes. 

What should providers do in the interim?

Current model participants can evaluate the impact of these changes compared to prior model years when evaluating their upcoming new baseline data and as Model Year 6 commences. 

Providers not currently enrolled in BPCIA should look for an announcement requesting applications from CMS in early 2023 for their chance to apply for the extension period. 

DataGen has the expertise to help providers evaluate opportunities under bundled payment arrangements and supports providers with their data analysis needs throughout the performance period. Contact us to learn more.