A second federal demonstration project involves bundled (shared) payments for complex orthopedic and cardiovascular surgical procedures as Acute Care Episodes (ACE). Integrated hospital and physician enterprises are being financially rewarded through a single Medicare payment for the episode of care. The global fee is divided among the treating physicians and hospital with the providers being responsible for the distribution of payments. The ACE goals are to improve medical quality for Medicare fee-for-service (FFS) beneficiaries, produce savings for providers and Medicare using market-based mechanisms. Price and quality transparency for improved decision-making as well as increase collaboration among providers are also ACE goals. Moreover, under an ACE structure, a hospital can bundle its surgical procedures and marketing them to insurers, self-insured employers and self-funded individuals. Some employers and individuals are already taking advantage of single, global fees for major surgical cases. Using the information contained in the Index of Accountable Care, hospitals and physicians can successfully compete for employers’ business using the Accountable Care Episode model.

Related Informatics:  Index of Accountable Care (IAC)