Five insights that improve BPCIA episode selection

CMS’ Bundled Payments for Care Improvement Advanced program will soon kick off a two-year program extension through 2025. Model Year 7 (Jan. 1 - Dec. 31, 2024) will be the first time that current participants (acute care hospitals and physician groups) can update their episode of care selections since 2020. MY7 is also only the second time since BPCIA launched (2018) that CMS will allow new providers to join. Applications were due May 31, 2023.

Whether you’re a new applicant or a current participant looking to update your episode selections to improve results, it’s never too early to prepare. BPCIA participants take on immediate full risk. This makes it critical to choose episodes that present the greatest savings, incentive and quality improvement opportunities.

Episode selection — An art and a science

For optimal BPCIA episode selection, providers must analyze their performance from the historic baseline period and design their clinical effectiveness strategies accordingly. It’s important to ask questions in five key areas: clinical buy-in, sufficient volume, actionable cost, manageable readmissions and achievable targets.

1. Ongoing clinical buy-in

Even long-time BPCIA participants must ensure their clinicians stay engaged, especially if they plan to alter episode bundles. As noted by Alyssa Dahl, DataGen’s senior director, advanced analytics, “Stakeholders must be willing to do the hard work to improve care coordination, identify preferred networks and manage the process through completion.”

Key questions to support buy-in:

• Have you identified a physician champion (existing or new)?
• Have you educated your staff about BPCIA and your program goals?
• Have you leveraged practice transformation wins from across your organization?

2. Sufficient episode volume

To succeed in BPCIA, participants must have sufficient episode volume — at least 100 episodes annually. Sufficient episode volume helps reduce random cost variation and improves clinical intervention assessment. Providers must plan for the varying levels of cost variation inherent in different types of episodes.

Key questions regarding episode volume:

• Has your episode volume significantly changed over time?
• Is your variance to the target price heavily skewed by outlier episodes?
• Can your organization sustain participation if performance fluctuates?

3. Actionable cost

Care management teams must be able to target enough actionable costs to generate savings above the BPCIA program discount. Actionable costs are all payments made by Medicare to providers during the post-anchor period of the episode, excluding professional services. DataGen recommends actionable costs account for at least 50% of the overall episode spend.

Key questions regarding actionable costs:

• What strategies can be used to reduce costs for this episode type?
• Are your episodes using appropriate settings for post-acute care?
• Do you understand what is driving your highest post-discharge costs?

4. Comprehensive readmission strategy

BPCIA participants must have a readmissions management program to better coordinate patient care and help reduce overall episode costs. Knowing when readmissions occur, from what post-acute care setting and for which diagnostic reasons can help inform a participant’s implementation strategy. 

Key questions about readmissions:

• What is an achievable readmission rate for each episode category?
• Do current referral patterns contribute to excess costs?
• Have you built a network of trusted, high-quality, post-acute care partners?

5. Advantageous target prices

Providers considering BPCIA participation must determine if the preliminary target price for an episode category is achievable for their organization. BPCIA target prices take into account the provider’s historic efficiency, current case mix and peer group trends. 

Key questions when reviewing target prices:

• How much actionable episode cost must be reduced to achieve the target price?
• How does your utilization compare to national, regional and high performance benchmarks?
• Do you expect your episode case mix to be different in the performance period?

The right questions provide the right answers

Every few months, providers should ask themselves the questions above, including the most important one: Has my hospital or physician group put itself at risk for the right reasons?

DataGen can help. Reach out today for baseline data analysis and consultation that can help you optimize episode selection and BPCIA performance.