News & Insights


June 3, 2024

Health Headlines – June 3, 2024

CMS Releases Fifth Annual Report on Bundled Payments for Care Improvement Advanced Model – On May 29, 2024, CMS released its fifth annual report evaluating the Bundled Payments for Care Improvement Advanced Model (BPCI Advanced Model).  The BPCI Advanced Model is designed to reduce Medicare spending and maintain or improve the quality of care for Medicare beneficiaries.  To assess the achievement of these objectives, the BPCI Advanced Model evaluates holding program participants financially accountable for the cost and quality of care provided during a patient care episode.  This is the first assessment of the model since changes were implemented in 2021.  The report indicates that the BPCI Advanced Model yielded net savings of approximately $465 million to Medicare in 2021.  The quality of results varied. 

The BPCI Advanced Model is a CMS Innovation Center voluntary bundled payment model.  Its predecessor initiative began in 2013 and concluded in 2018.  Building on its predecessor model, the BPCI Advanced Model has participants who bear financial risk only for their own performance and participants who are organizations that bear financial risk on behalf of hospitals and physician group practices (PGPs) and provide guidance to help hospitals and PGPs succeed in the model.  Participants could join the model in Model Year 1 (beginning in October 2018), Model Year 3 (beginning in January 2020), or Model Year 7 (beginning in January 2024).  The report presents results for the first year after significant changes to the BPCI Model were implemented. 

A summary of the key report findings is as follows:

  • The number of unique participants declined 37.2% from 2020 to 2021, but the average number of clinical episodes in which a given episode initiator was actively participating nearly doubled for hospitals and more than doubled for physician group practices.
  • In 2021, about one in five eligible U.S. hospitals participated in the BPCI Advanced Model.
  • Hospitals and physician group practices implemented care redesign activities that transformed care across four domains: culture, structure, process, and relationships.
  • About one in five BPCI Advanced Model hospitals and PGPs participated in a Medicare Shared Savings Program Accountable Care Organization (ACO) in 2021.
  • 2021 was the first year that the BPCI Advanced Model resulted in savings to the Medicare program. The net savings for 2021 was $464.7 million, which offset the combined losses of $179.5 million in the first three model years.

The report states that CMS has a goal of having 100% of traditional Medicare FFS beneficiaries in accountable care relationships by 2030.  CMS stated that it will continue evaluating the BPCI Advanced Model through the five strategic objectives outlined in the CMS Innovation Center strategy,  published in 2021, of: (1) driving accountable care, (2) advancing health equity, (3) supporting innovation, (4) addressing affordability, and (5) partnering to achieve system transformation. 

A copy of the report is available here.

Reporter, Doug Comin, Atlanta, +1 404 572 3525,