Home Health Leaders Applaud Post-Acute Care Payment Reform Bill

Home health industry groups commended recently introduced legislation from two House Representatives that will establish a bundled payment system for post-acute care services covered by Medicare. 

Representatives Dave McKinley (R-WV) and Tom Price (R-GA) introduced the Bundling and Coordinating Post-Acute Care—or BACPAC—Act of 2014 (HR 4673) to support the delivery of clinically advanced care in the most cost-effective setting for the nation’s expanding Medicare population. 

The bill establishes a site-neutral bundled payment model for Medicare post-acute care services, which home health leaders prefer to “across-the-board” cuts as the means to generate Medicare program savings.


“We commend Congressmen McKinley and Price for taking up this important issue to strengthen our nation’s senior care delivery system and look forward to working with them and their colleagues in Congress to advance this important reform legislation,” stated Eric Berger, CEO of the Partnership for Quality Home Healthcare. 

The BACPAC model calls for post-acute care coordinators and their networks of post-acute care providers to manage patient care, using the 90-day, site-neutral bundled payment initiated on the day of patient discharge from the hospital. 

“By rewarding participants if the total cost of care is lower than the bundled amount, the BACPAC model encourages the delivery of quality clinical care in the most coordinated manner and in the most cost-effective settings that meet patients’ clinical needs,” the Partnership stated in a release.


The BACPAC model also aims to significantly reduce hospital readmissions by including the cost of readmissions within each bundle to give at-risk coordinators and providers an incentive for patients to be placed in the most clinically-appropriate, cost-effective setting for their needs.

Patients are able to choose their coordinator and their network of providers under the model. Additionally, BACPAC empowers patients to select from among the providers within the coordinator’s network, thus affording more extensive patient choice rather than be limited to any particular set of providers based on the site of their hospitalization. 

The legislation introduced by Reps. McKinley and Price stems from analysis put forth by the Alliance for Home Health Quality and Innovation in January, compiled in cooperation with Dobson DaVanzo & Associates.

The analysis discusses how post-acute bundled payments provide benefits to patients, providers and the overall healthcare system by controlling costs and facilitating the best medical outcomes. 

Previous research also found that given the overlap of patients with similar clinical and demographic characteristics across post-acute care settings, Medicare could achieve savings up to $100 billion over ten years by shifting patients into different settings and reducing spending by varying degrees, the Partnership noted. 

“As our population ages, the need for well managed post-acute care will become a pressing necessity for the sustainability of our healthcare system,” Berger stated. 

Written by Jason Oliva

Companies featured in this article: