ACA initiative targets coordinating care

CMS bundles payments

The U.S. Department of Health and Human Services (HHS) has launched a new initiative to help improve care for patients from their hospital stay through their transition back to the community.

Hospitals, physicians, and other providers can apply to participate in a program called the Bundled Payments for Care Improvement initiative, which will align payments for services delivered across an episode of care rather than paying for services separately. The goal is to give hospitals and physicians incentives to coordinate care, save money for Medicare, and improve care quality.

The Centers for Medicare & Medicaid Services (CMS) initiative will bundle care for a package of services patients receive to treat a specific medical condition during the hospital stay and recovery from that stay. By bundling payments for these episodes of care across providers, there will be a greater incentive for various providers to coordinate care transitions and ensure continuity of care from the hospital to the community. HHS aims to reduce unnecessary duplication of services, reduce preventable medical errors, and lower costs.

The initiative is launched by the CMS Innovation Center, which was created by the Affordable Care Act.

Requests for applications (RFAs) outline four broad approaches to bundled payments. Providers can determine which episodes of care and which services will be bundled together. The initiative is the result of earlier demonstration projects that suggest the approach could save CMS millions. In one example, a Medicare heart bypass surgery bundled payment demonstration saved the program $42.3 million or about 10% of expected costs, and it saved patients $7.9 million in coinsurance. It also improved care and lowered hospital mortality, HHS officials say.

Organizations interested in applying for funding for Bundled Payments for Care Improvement must submit a letter of intent by Nov. 4, 2011, for Models 2,3, and 4. The Model 1 deadline was Sept. 22, 2011. For more information, visit the CMS website at Also, they can email CMS at

For more information about the CMS Innovation Center, go to the website: