Reimbursement News

New WEDI Focus on Bundled Payments, Value-Based Initiatives

By Jacqueline DiChiara

- The Workgroup for Electronic Data Interchange (WEDI) recently announced its Payment Models Workgroup is forming a new project team committee – the Bundled Payments Taskforce – to more closely examine bundled payments and various value-based reimbursement initiatives.

WEDI launches bundled payments taskforce under payment models workgroup

Such efforts are connected to past initiatives from The Centers for Medicare & Medicaid (CMS) to launch a bundled payments initiative for organizations to initiate payment arrangements, including financial accountability, for episodes of care in 2013. These models aimed to produce quality and coordinated care at a decreased cost to Medicare, says CMS.

In relation to this effort, CMS Innovation launched a Bundled Payment for Care Improvement demonstration for forty-eight episodes in 2013. The following year, CMS announced the addition of over four thousand more providers to the two thousand four hundred demonstration participants.

Regarding the latest workgroup initiative, there are several primary objectives of WEDI’s Bundled Payments Taskforce. One goal is to advance efforts in bundled payment adoption and implementation to enhance sustainability within the healthcare industry. Another goal includes assessing the model’s attributes, information, and technology needs. Additionally, the project team aims to work towards cultivating solutions via an industry-wide action plan.

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  • These focused initiatives have particular significance given the healthcare industry’s vast evolution from fee-for-service to fee-for-value. Bundled payments, budding payment models of value based reimbursement, are becoming more mainstream in public and private sectors within the realm of medical reimbursement.

    “Because of this momentum,” confirms an issue brief released by the Payment Models Workgroup, “it is increasingly important for all stakeholders to gain a better understanding of bundled payments.”

    “WEDI is taking the initiative to lead industry efforts to ensure that the new models are effectively leveraging technology to make the movement of payment-related data as efficient as possible,” states Devin Jopp, EdD, WEDI President and CEO. “With the gaining momentum of the bundled payments, WEDI is convening leading healthcare organizations to help develop industry guidance on how to streamline the exchange of clinical and administrative data in these forms of payment models.”

    Two ways payment for services programs may change

    In a retrospective payment model, providers submitting claims receive fee-for-service payments for medical services included within this episode. After the completion of care, reconciliation occurs between the episode’s actual cost and the budgeted cost. The difference is cost between actual and budgeted amount may result in supplemental payment between payer and contracting provider after the episode ends.

    According to WEDI’s issue brief, most participants in the Center for Medicare & Medicaid Services (CMS) Bundled Payment for Care Improvement initiative include retrospective payment arrangements where actual expenditures are compared to a target price for an episode of care.

    Retrospective episode of care programs have been executed by Arkansas, Tennessee, New Mexico, and Ohio.

    Likewise, in a prospective payment model, current fee-for-service payments are changed. Providers who have submitted claims for medical services receive a lump sum payment instead of fee-for-service payments. This payment to the contracted provider is for an agreed reimbursement amount generally spanning across multiple services, providers, and dates of service. A contract provider disperses this lump sum among other providers involved in a specific episode. The payer does not pay for claims generated for included services by providers.

    WEDI’s taskforce’s further investigation intends to offer valuable courses of action for developing smooth operation of the Bundled Payment model for increased long term sustainability.