The Centers for Medicare & Medicaid Services released a final evaluation of the Bundled Payments for Care Improvement Advanced Model, a payment experiment that generated more than $800 million in net Medicare savings over eight years. However, the model did not meet criteria for expansion and will be replaced by a new payment arrangement.
BPCI Advanced was designed to address fragmented post-acute care that drives unnecessary Medicare spending. Under the model, hospitals and physician group practices took on financial responsibility for all care in a defined treatment episode, creating incentive to coordinate discharge planning, reduce unnecessary readmissions, and lower overall costs. Participants achieved expenditure reductions of $700 to $1,100 per episode on average, the evaluation found.
The model also increased awareness of post-acute care costs and quality among participants, leading them to focus more on ensuring patients recovered successfully. While BPCI Advanced did not meet the Innovation Center's expansion criteria, the agency said it is incorporating key lessons into the Transforming Episode Accountability Model (TEAM), which launched January 1, 2026.
TEAM is another episode-based payment model aimed at reducing unnecessary emergency department visits and hospital readmissions. The Innovation Center said the evidence from BPCI Advanced supports the broader strategy of moving Medicare beneficiaries into accountable care arrangements with providers who assume total responsibility for the cost and quality of care.