A forthcoming alternative payment model for hospitals focuses on discharge planning and ensuring effective post-acute care, including hospice and palliative care when appropriate.

The U.S. Centers for Medicare & Medicaid Services (CMS) late last year unveiled its new Transforming Episode Accountability Model (TEAM). Participation in the model will be mandatory for select hospitals. The program is set to launch on Jan. 1, 2026 and run through Dec. 31, 2030. CMS designed the program based on lessons learned from previous episode-based payment models, as well as input from stakeholders in response to a Request for Information published in 2023.

Through the model, hospitals will coordinate care for traditional Medicare beneficiaries who undergo one of a select list of surgical procedures, including lower extremity joint replacement, surgical hip femur fracture treatment, spinal fusion, coronary artery bypass graft and major bowel procedures. Participating hospitals will be responsible for the cost and quality of care from surgery through the first 30 days following hospital discharge.

More than 700 hospitals paid under the Inpatient Prospective Payment System (IPPS) and located in the selected CBSAs are required to participate in TEAM, according to CMS.

A key component of the model is ensuring that hospitals connect patients with appropriate post-acute care providers, including services like primary care, skilled nursing facility stays, home health and hospice.

“It’s almost helping hospitals kind of get a little bit of a jump start into value-based care, where it’s less about just kind of heads in beds in fee-for-service, but let’s actually think about what’s happening to these patients once they leave,” Dr. Jamie Chang, chief medical officer for the health care tech firm WellSky told Hospice News. “It’s a good move to almost force the transition to be more mindful of what’s happening with your patient once they leave. It’s not just about clearing your bed, but let’s make sure these patients have a good transition and that they do well once they leave the hospital.”

For purposes of TEAM, CMS will provide participants with a target price that will represent most Medicare spending during an episode of care, which will include the surgery, related hospital stays and items and services following hospital discharge.

“Holding participants accountable for all the costs of care for an episode may incentivize care coordination, improve patient care transitions and decrease the risk of avoidable readmission,” CMS indicated on its website. 

The model is designed to reduce fragmented care among surgical patients, support care coordination and effective transitions of care and promote recovery that avoids preventable hospital readmissions and emergency department visits.

“Some of these are typically very high-acuity procedures that are almost an issue of last resort,” Chang said. “From a surgical standpoint, I think it becomes really important to identify which patients are most appropriate to start having these advanced care planning, palliative and hospice types of discussions. It’s like really evaluating what the quality of life is going to be like post procedure and providing the right set of options to patients.”