Press Release

Thursday, January 31, 2013

Integrated Healthcare Association Selected to Participate in the CMS Bundled Payments for Care Improvement Initiative as Model 4 Convener

Today, the Centers for Medicare & Medicaid Services (CMS) announced the health care organizations selected to participate in the Bundled Payments for Care Improvement (BPCI) initiative, an innovative new payment model. The Integrated Healthcare Association (IHA) was selected to be a Model 4 facilitator and convener of five southern California hospitals and medical center participants: Providence Holy Cross Medical Center (Mission Hills) part of Providence Health & Services, Southern California; Pomerado Hospital (Poway) part of Palomar Health; and three hospitals from St. Joseph Health – St. Jude Medical Center (Fullerton), St. Joseph Hospital (Orange), and Mission Hospital (Mission Viejo).

“This presents a unique opportunity to integrate care between hospitals and physicians to improve quality and patient satisfaction,” said Michael Hunn, senior vice president and regional chief executive of the California region, Providence Health & Services, and IHA Board Director.

IHA’s participation as a Model 4 facilitator and convener encompasses acute care hospital stays only for total hip and knee joint replacements. In this model, the hospitals would receive a single, prospectively determined bundled payment for all services furnished by the hospital, physicians, and other practitioners during the inpatient stay and related readmissions for 30 days after hospital discharge. The initiative applies to Medicare fee-for-service beneficiaries, and not beneficiaries enrolled in Medicare Advantage HMOs.

“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.

About the Bundled Payments for Care Improvement Initiative

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:

About the Integrated Healthcare Association (

IHA is a not-for-profit multi-stakeholder leadership group that promotes quality improvement, accountability and affordability of healthcare in California. IHA administers regional and statewide programs, serves as an incubator for pilot programs and projects, and actively convenes all healthcare parties for cross sector collaboration on healthcare topics. IHA principal projects and areas of expertise include performance measurement and analytics, the California Value Based pay for performance program, administrative simplification, healthcare affordability, bundled episode of care payments, and Accountable Care Organizations.