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SJRMC Selected to Participate in the Selective ‘Bundled Payments for Care Improvement Initiative’

Today the Centers for Medicare & Medicaid Services (CMS) announced that Saint Joseph Regional Medical Center (SJRMC) has been selected as one of 500 healthcare organizations across the nation that will begin participating in the Bundled Payments for Care Improvement Initiative. Through this initiative, made possible by the Affordable Care Act, CMS and demonstration sites will test how bundling payments for episodes of care can result in more coordinated care for beneficiaries and lower costs for Medicare.

“Saint Joseph Regional Medical Center is honored to be selected as a demonstration site for such an important initiative,” said Albert Gutierrez, President and Chief Executive Officer of SJRMC. “We are excited to begin this journey, and look forward to working with physicians and other partners on an innovative new payment model that will ultimately improve the cost of care and quality of services for the entire Michiana community, as well as the nation.”

Under the Bundled Payments initiative, CMS would link payments for multiple services that patients receive during an episode of care. For example, instead of a surgical procedure generating multiple claims from multiple providers, the entire team is compensated with a “bundled” payment that provides incentives to deliver health care services more efficiently while maintaining or improving quality of care. Providers will have flexibility to determine which episodes of care and which services would be bundled together.

“The objective of this initiative is to improve the quality of health care delivery for Medicare beneficiaries, while reducing program expenditures, by aligning the financial incentives of all providers,” said Acting Administrator Marilyn Tavenner.

The Bundled Payments for Care Improvement initiative includes four models of bundling payments, varying by the types of health care providers involved and the services included in the bundle. Depending on the model type, CMS will bundle payments for services beneficiaries receive during an episode of care, encouraging hospitals, physicians, post-acute facilities, and other providers as applicable to work together to improve health outcomes and lower costs. Organizations of providers participating in the initiative will agree to provide CMS a discount from expected payments for the episode of care, and then the provider partners will work together to reduce readmissions, duplicative care, and complications to lower costs through improvement.

Today’s announcement marks the start of Phase 1 of Models 2, 3, and 4. In Phase 1 (January-July 2013), over 100 participants partnering with over 400 provider organizations, will receive new data from CMS on care patterns and engage in shared learning in how to improve care. Phase 1 participants are generally expected to become participants in Phase 2, in which approved participants opt to take on financial risk for episodes of care starting in July 2013, pending contract finalization and completion of CMS’ standard program integrity reviews.

For more information on the Centers for Medicare & Medicaid Services Bundled Payments for Care Improvement Initiative please go to

Saint Joseph Health System  |  5215 Holy Cross Parkway, Mishawaka, IN 46545  |  574.335.5000

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