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Medicare Expands Bundled Payments to Cardiac Care, Hip Surgery

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July 28, 2016


The Centers for Medicare & Medicaid Services would require hospitals in 98 metropolitan areas to take on the financial risk of providing coronary bypass surgery, heart attack care, and hip surgery, as well as the costs of any additional care such patients might require within 90 days of their discharge. The proposal is part of a five-year demonstration project scheduled to begin in mid-2017.


  • Hospitals would receive a bundled payment—a single fee which would cover all hospital care and any additional care the patient receives within 90 days. This could include nursing home, emergency room, readmission, or other types of care.
  • CMS would set a price for the payment bundle based on historical costs for the hospital and the region. Hospitals performing well on quality metrics would receive a higher payment amount than those with lower scores. Those hospitals with spending levels above the bundled payment price would have to absorb some of the losses.
  • The proposal would allow physicians to potentially qualify for financial rewards under the Medicare Quality Payment Program—the new system for determining physician payment updates established by the Medicare Access and CHIP Reauthorization Act (MACRA). The law directed that physicians participating in Advanced Alternative Payment Models in which they bear financial risk could qualify for payment bonuses and avoid a range of reporting requirements.
  • Participation in the cardiac care bundles would be mandatory for hospitals in 98 randomly selected metropolitan areas. Hospitals outside of those areas could not participate.
  • Participation in the hip surgery bundles—which would cover surgical treatments for hip and femur fractures beyond hip replacement---would be for hospitals in the 67 metropolitan areas that are currently part of the Comprehensive Care for Joint Replacement Model, another major CMS initiative that went into effect in April, 2016.


Comments are due on the new proposal by September 26, 2016.


View CMS fact sheet

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