This is an archive page. The links are no longer being updated.
Date: Wednesday, April 10, 1996 FOR IMMEDIATE RELEASE Contact: HCFA Press Office(202)690-6145
Premier cardiovascular and orthopedic facilities offering beneficiary incentives and reduced costs to the Medicare program will receive "Participating Centers of Excellence" designations under a new demonstration project being undertaken by the Health Care Financing Administration.
The resulting prices are expected to represent a substantial savings to the Medicare program.
To be located in as many as 10 states, the demonstration centers will be required to meet volume and high-quality standards. Medicare beneficiaries will continue to have free choice of providers. However, the centers are expected to offer beneficiaries such additional inducements as lower cost-sharing, simplified claims processing and lodging support.
"We believe the Centers of Excellence concept will increase Medicare beneficiaries' access to high-quality health care at affordable prices," said HCFA Administrator Bruce C. Vladeck. "Negotiated bundled payments have great potential for changing the way providers are paid by the Medicare program."
HCFA will negotiate package prices for hospital and related physician services provided during episodes of care for selected cardiovascular procedures and total joint replacement procedures. Hospitals and associated physicians can apply for these bundled payment arrangements for either group of inpatient services or both.
The new demonstration builds on the experience gained from two previous bundled payment projects for coronary artery bypass graft (CABG) and outpatient cataract surgical procedures. The Medicare participating heart bypass center demonstration showed an estimated savings of nearly $40 million for Medicare for 10,000 CABGs at seven sites. The cataract surgery alternative payment demonstration, which was implemented at four sites in three cities, was estimated to save Medicare more than $500,000 for some 7,000 surgeries.
The opportunity to participate in the new demonstration is open to selected hospitals in Arizona, California, Hawaii, Illinois, Indiana, Michigan, Minnesota, Nevada, Ohio and Wisconsin.
Institutions in those states have been mailed solicitations. Preapplications from interested organizations are due back to HCFA by May 10. Following intensive review, selected organizations will be asked to submit final applications. Selections will be based on quality, organizational capability, commitment, price and geographic dispersion. Up to 100 facilities may be designated as a Center of Excellence.
Copies of the solicitation, and additional information on the demonstration, can be obtained from HCFA's Office of Research and Demonstrations: (410) 786-7800.