Medicare Participating Heart Bypass Center Demonstration
Demonstration Type
Completed Demos & Evaluation Reports
Year
1998
Description
The Medicare Participating Heart Bypass Center Demonstration was conducted to assess the feasibility and cost effectiveness
of a negotiated all?inclusive bundled payment arrangement for coronary artery bypass graft (CABG) surgery while maintaining
high quality care. HCFA originally negotiated contracts with four applicants (1991). In 1993 the government expanded the demonstration
to include three more participants. The evaluation by Health Economics Research showed that an all-inclusive bundled payment
arrangement can provide an incentive to physicians and the hospital to work together to provide services more efficiently,
improve quality, and reduce costs. The bundling of the physician and hospital payments did not have a negative impact on the
post-discharge health improvements of the demonstration patients.
