The Centers for Medicare & Medicaid Services (CMS) has issued an amendment to the Bundled Payments for Care Improvement (BPCI) Advanced Participation Agreement (Amendment). Changes imposed by the 18-page Amendment were largely based on stakeholder input and could streamline aspects of the program and ease burdens on both convener and non-convener participants. Participants must choose to enter into the Amendment by June 1, 2019. If CMS incorporates the Amendment into an Amended and Restated Participation Agreement[1], participants will have until October 1, 2019 (or other date if specified by CMS) to accept the terms of such agreement and extend the term of the agreement through 2022.

Participants that choose not to execute the Amendment will not receive any of the potential benefits of the Amendment, including the following notable changes:

  • Removal of 50% Payment Caps. The Amendment strikes provisions that prohibited Net Payment Reconciliation Amount (NPRA) shared payments or partner distribution payments from exceeding 50% of the total Medicare fee-for-service payment for all items and services that were both (1) billed by the applicable provider and (2) included in clinical episodes attributed to the program participant. By removing these caps, CMS gives participants more flexibility to structure sharing arrangements while also alleviating administrative burdens applicable to stakeholders.
  • Addition of QPP List. CMS has opted to create a single Quality Payment Program (QPP) List for purposes of identifying eligible clinicians participating in BPCI Advanced for potential “QP Status,” which can lead to exclusion from the MIPS reporting requirements and payment adjustments. The original participation agreement was unclear with respect to participants’ requirements for reporting on specified lists, particularly where physician group practices (PGPs) were not involved. While many participants would include such providers on a PGP List under the original participation agreement, a convener with no downstream PGP episode initiators was required to include providers seeking QP Status on its Financial Arrangement List, which potentially required a more comprehensive written agreement between the parties. The Amendment streamlines this process by removing the prior PGP List and instead requires that providers eligible for QP Status be included on the new QPP List. The Amendment also revises the definition of “Participating Practitioner” such that providers included on the QPP List must have a written agreement with the participant that requires compliance with all applicable terms and conditions of the participation agreement.
    Since the release of the draft Amendment, CMS has clarified that participants must submit QPP Lists populated with all eligible Participating Practitioners or face potential consequences ranging from remedial action to Participation Agreement termination. Meeting this broad requirement could be difficult for participants, particularly large conveners. In an update sent to participants on May 28, 2019, CMS recognized concerns from stakeholders about the time constraints for complying with this requirement and entering into written agreements with Participating Practitioners. In the update communication, CMS stated it will accept blank Q3 2019 QPP Lists from Participants who need additional time beyond June 1, 2019, to comply with the requirements of the QPP List and the Amendment. CMS has also stated that it will not extend this policy for future deliverables; blank QPP Lists will not be accepted starting in Q4 2019.
  • Removal of Certain Reapplication Restrictions. The Amendment also removes a provision that prohibits participants from reapplying to the program for at least one full model year after termination of a participation agreement. This change likely addressed stakeholder reactions to a prior CMS interpretation that could have had a disproportionately negative impact on conveners and other participants with multiple participation agreements that were used to avoid aggregating risk associated with unaffiliated episode initiators. Without the Amendment, such participants would have potentially been prohibited from applying under a new participation agreement in the last planned BPCI Advanced application period due to termination of just one participation agreement applicable to a single episode initiator. This change may boost participation in the model by giving participants the ability to restructure participation agreements and allow new episode initiators to more easily join the model in 2020 with conveners.
  • Adjustments to Secondary Repayment Source Requirements and Calculations. The Amendment clarifies the definition of Secondary Repayment Source (SRS) and revises the definition of “SRS Covered Participant” to exclude convener participants that have entered into “SRS Reduction Agreements” with its downstream episode initiators. SRS Reduction Agreements give CMS the right to collect amounts owed to CMS by reducing Medicare payments otherwise paid to the downstream episode initiator. This aspect of the Amendment provides an alternative for participants that do not wish to place the necessary SRS amount in an escrow fund or establish a letter of credit. The Amendment also allows convener participants with the same tax identification number (TIN) and multiple Bundled Payment Identifications (BPIDs) to aggregate all of their standard SRS amounts together for purposes of receiving the benefit of an adjusted amount calculation at the TIN level as opposed to the individual BPID level.
  • Waiver of Originating Site Requirements for Telehealth. The Amendment expands the payment policy waiver for Medicare telehealth services to waive both the geographic area and setting requirements for telehealth originating sites. The original participation agreement only addressed waiver of the geographic area requirement, and this change will allow Medicare reimbursement for telehealth services provided in the BPCI Advanced beneficiary’s home or other place of residence.
  • Removal of References to Wholly-Owned Episode Initiators. Lastly, the Amendment removes all references to any requirements applicable to wholly-owned episode initiators.

Bass, Berry & Sims will continue to monitor BPCI Advanced publications, including any updates to the Amendment or additional materials issued leading up to the anticipated close of the BPCI Advanced Model Year 3 application period later in June. If you have questions about how this recently issued amendment affects your business, please contact the authors.

[1] The Amended and Restated Participation Agreement will likely be released this fall before the start of the third year of BPCI Advanced. See