September 2014 Newsletter

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Monthly Newsletter

Volume 3  Number 9

September 1, 2014

Bundled Payment for Care Improvement Initiative (BPCI)


The Bundled Payments for Care Improvement (BPCI) Initiative was developed by the CMS Innovation Center as a result of the Affordable Care Act.  The purpose is to test innovative payment and service delivery models that have the potential to reduce Medicare, Medicaid, or Children’s Health Insurance Program expenditures while preserving or enhancing the quality of care for beneficiaries.

Participating organizations can be hospitals, skilled nursing centers, inpatient rehabilitation facilities, home health agencies.  SVMC and our post-acute partners (Lord Chamberlain and The Jewish Home) are participating providers.

A facilitator (SVHP) is an entity that serves an administrative and technical assistance function in helping participants redesign care.  The facilitator does not have an agreement with CMS, bear financial risk or receive payment from CMS.  The facilitator assists with financial arrangements made between the participating organization and the convener.

A Convener (NaviHealth) is an entity that bears the financial risk and receives payment from CMS.  The Board voted to partner with NaviHealth as our financial convener and therefore, NaviHealth will assume the risk.

On February 14, 2014, CMS announced an expansion of the program to include new hospitals, health systems and provider practices.  These bundles will start on January 1, 2015, and are comprised of four broadly defined models of care, depending upon where the episode of care initiated.  Reimbursement will be based upon services provided to beneficiaries for that episode of care.

SVMC is looking to participate in MODEL 2:  Retrospective Acute Care Hospital Stay plus Post-Acute Care*
The episode of care is initiated at the time of admission to the hospital and includes all related services during the episode.  Participants select when the episode of care will end – 30, 60 or 90 days after discharge.  Participants select up to 48 episodes of care.

Our Skilled Nursing Facility Partners are looking to participate in MODEL 3:  Retrospective Post-Acute Care Only*
A hospital admission triggers the episode of care, however the episode of care does not begin until the beneficiary begins post-acute care services in a skilled nursing center, inpatient rehabilitation facility, long-term care hospital or home health agency.  The episode must begin within 30 days of discharge from the hospital.  The post-acute provider selects when the episode of care will end – 30, 60 or 90 days and can select up to 48 episodes of care.

*The bundle in Models 2 and 3 includes physician services, care by post-acute providers, related readmissions and related Medicare Part B services.  The rate is determined by historical fee-for-service payments minus a discount.  Payments to providers are made at the usual fee-for-service rate and then reconciled against the target price.  Any savings that is realized is paid to the participant and may be shared among the providers.  Any expense that is above the target price is paid back to Medicare by the participant.

The BPCI initiative consists of 2 phases: The first phase is the “preparation” period in which CMS shares data with participants and participants prepare for possible implementation and assumption of financial risk.  Once approved by CMS, the participants can enter into a BPCI Model Agreement with CMS and begin Phase 2.

We are currently in Phase 1-the “preparation” phase.  This month we will receive data from CMS on all 48 episodes of care.  From this information, we will select the triggering episodes of care.  Because of the overwhelming response to the expansion of the program, participants will have an opportunity to transition into Phase 2, which is known as the “risk-bearing” phase.

On January 1, 2015, we will become accountable for the quality and cost of at least one episode that has been chosen.  In April, July and October 2015, we can transition additional episodes of care.  By October 2015, Phase 1 will end and all participants will be in Phase 2.

Data Privacy and Cyber Liability

Most physician practices don’t believe that their IT systems will be hacked or have a data breach.  All you hear about are the big ones such as Target, Michael’s, a large health system or a hospital, but that doesn’t mean that physician practices are not hacked because they are small.  According to Ted Levine, CEO of Insureon, one of the largest insurance brokers for small businesses in the nation, “The reality is that small businesses get hacked far more often than the big ones but you’re not going to turn on the evening news and hear about it.”

Experts in the Data Breach Industry forecast that “The healthcare industry, by far, will be the most susceptible to publicly disclosed and widely scrutinized data breaches in 2014.”  Experian helps companies recover from personal data breaches and in 2013 46% of the breaches they serviced were healthcare and they expect it to rise significantly in 2014. Breaches don’t just happen from advanced hacking techniques they also happen through last laptops, failing to shred paper records, insider data theft and other employee errors.

The information in a physicians file is valuable and that makes them a target.  On the black market, personal records suitable for identity theft are worth $10 – $12 each at the low end and $25 – $28 for an attractive identity.  When this information is enriched with health data the value jumps to about $50 per record because it can also be used for medical and insurance fraud.

The financial cost of a physician practice data breach is high because there are so many records involved.  The estimates of the cost per record breach by experts range widely.  There is the cost of: determining what happened, notification, credit monitoring, fines by state and/or federal authorities and monitoring by the authorities.  A good average cost, not including your employee expense, is $100 per record for the first year if there is no gross negligence.

It is essential that a response plan for a breach be established before it happens so you will know the steps that need to betaken quickly.  Some say it is not a matter of if you will have a breach it is a matter of when.  If you have insurance for cyber liability the insurance company can help you plan a response.  If not, Cyber/Data Privacy insurance is now competitively priced and will cover these cost plus, and just as important, the insurance company will have the experts to guide you through the process.

For additional information, please contact Karen O’Driscoll, Director of Professional Relations at (203) 275-0205 or

ICD-10 eHealth University Resources


The Centers for Medicare & Medicaid Services (CMS) has released a new webcast introducing the “Road to 10” tool. Accessible through the “Road to 10” link on the CMS website, the webcast covers the history of the International Classification of Diseases (ICD) and the benefits of ICD-10. This is the first in the new “Road to 10” webcast series. Five more webcasts will follow—all aimed at helping small practices get ready for ICD-10 by the October 1, 2015, compliance date.

Also available now is a brief video introduction to the “Road to 10” tool. Developed in collaboration with physicians, the “Road to 10” tool offers:

  • Clinical documentation tips
  • Coding concepts
  • Clinical scenarios
  • Training calendar

Go to the CMS ICD-10 website to get started on the “Road to 10” today.

Keep Up to Date on ICD-10
Visit the CMS ICD-10 website for the latest news and resources to help you prepare. Sign up for CMS ICD-10 Industry Email Updates andfollow us on Twitter.


Contact Information

Dr. Thomas Raskauskas, President/CEO, (203) 275-0202

Dr. Michael Hunt, Chief Medical Officer/Chief Medical Informatics Officer, (203) 275-0203

Anthony Brockman, Director of Information Technology, (203) 275-0206

Colleen Swedberg, MSN, RN, CNL, Director for Care Coordination and Integration, (203) 275-0209

Karen O’Driscoll, Director of Professional Relations, (203) 275-0205

Alvino Williams, Jr., IT Analyst/Clinical Integration, (203) 275-0207

Kyle Lanning, JD, Integration Associate, (203) 275-0204

Erika Foster, Integration Associate, (203) 275-0208

Gretchen Cavaliere, Administrative Assistant, (203) 275-0201