Dive Brief:
- Universal Health Services is debating whether to pull out of Medicare's voluntary test of its Bundled Payments for Care Improvement Initiative, which started last August and includes 2,100 acute care hospitals, Modern Healthcare reports.
- This initiative is part of CMS' efforts to increase Medicare agreements that reward hospitals for quality improvements and cost controls.
- Medicare will pay one bundled payment for all care provided to treat a specific condition, including hospitalization and sometimes post-hospital care. Providers able to keep costs below that amount are entitled to keep the difference.
Dive Insight:
Voluntary bundled payment programs have been ongoing since 2013 with 1,500 participants testing how they work for 48 different conditions such as stroke, diabetes, kidney failure, and heart attacks.
A mandatory program that starts April 1 is focused on hip and knee replacements.
Universal Health's CFO Steve Filton told analysts when providing 2015 financial results that the company is not getting useful data from the program "to be able to really participate in this in a sort of meaningful way and make meaningful changes."
Filton also told Modern Healthcare it may keep a few of its 25 acute-care hospitals in the program to monitor its progress.
However, the company overall had higher margins last year compared to 2014 and reported $9.04 billion total revenue, up 10.2% from the previous year. Its net income for 2015 increased almost 25% to $680.5 million.