Development of bundled payment initiatives for care improvement in the United States

In 2013, the US Centers for Medicare and Medicaid Services implemented the nationwide Bundled Payments for Care Improvement (BPCI) initiative. The BPCI initiative comprised four case models, namely Model 1, Acute Care Hospital Stay Only; Model 2, Acute & Post-Acute Care Episode; Model 3, Post-Acute Care Only; and Model 4, Prospective Acute Care Hospital Stay Only. The goal of the BPCI initiative was to transition from a traditional fee-forservice model to value-based care through bundling acute inpatient or outpatient procedures with post acute care (PAC) services into a single prospective payment, reducing health-care expenditures while maintaining quality of care. This initiative successfully reduced payments for discrete care episodes but incurred net losses due to the cancellation of shared costs, despite the presence of shared savings in payment reconciliation. Therefore, in 2018, the BPCI Advanced program was initiated as a continuation of the BCPI Model 2, which had the most participants and the best cost control. The BCPI program focused solely on bundling services from the time of an inpatient or outpatient procedure to 90 days after discharge. Additionally, the program incorporated the individual composite quality score of each participant into adjustments to target pricing methodology and payment reconciliation to slow the rise in health-care expenditures while maintaining quality of care. Given increasing health-care costs in Taiwan (due to a rapidly aging population and declining birth rate), the government should consider implementing a prospective payment program for hospitalization and PAC. Acute care can also be bundled with PAC and rehabilitation services under the Long-Term Care Plan 2.0 into fixed payments. This program should monitor care quality indicators to reduce national health expenditures while maintaining high-quality care for patients. (Taiwan J Public Health. 2025;44(1):4-17).