McKesson and HCI3 Form Partnership to Support Large-Scale Bundled Payment Programs

  McKesson and HCI3 Form Partnership to Support Large-Scale Bundled Payment

   McKesson Episode Management and PROMETHEUS Payment Model Combine to Spur
                    Adoption of Healthcare Payment Reform

Business Wire

NEWTON, Mass. -- November 15, 2012

McKesson and the Health Care Incentives Improvement Institute (HCI3) have
entered into an agreement that will support healthcare organizations’ growing
interest in bundling payments for episodes of care, a promising alternative to
fee-for-service (FFS) reimbursement for healthcare services. Bundled payments
seek to move payers and providers to a value-based system in which
reimbursement supports evidence-based best practices with quality outcomes
rather than volume-based delivery, which in turn lowers overall costs by
avoiding preventable complications. The agreement will combine McKesson
Episode Management™, software that automates complex bundled payment programs
of all sizes, with the PROMETHEUS Payment^® model, a leading set of episode
definitions and reimbursement logic.

According to Francois de Brantes, executive director, HCI3, momentum is
building around this healthcare reform initiative: “Bundled payment activity
is clearly expanding with government commitment through the Affordable Care
Act. Spurring adoption are the pilots’ positive impacts on lowering costs
while improving quality, technology solutions such as McKesson Episode
Management that reduce program complexity, and greater standardization of
episode logic and definitions through organizations such as HCI3.”

“For this methodology to take hold, standardization around generally accepted
best practices is critical,” said Amy Larsson, associate vice president of
emerging solutions at McKesson Health Solutions. “HCI3 is a recognized leader
in defining the services bundled together into an episode of care across acute
and chronic conditions, including inpatient and outpatient procedures. We see
our partnership as an ideal blend of the clinical and technology expertise
required to fuel program success, particularly of large-scale advanced
reimbursement initiatives.”

Launched in 2006 with the support of the Robert Wood Johnson Foundation, the
PROMETHEUS Payment model packages payment around a comprehensive episode of
medical care that covers all patient services related to a single illness or
condition. Covered services are determined by commonly accepted clinical
guidelines or expert opinion that lay out the tested, medically accepted
method for best treating the condition from beginning to end. A
patient-specific budget is set for the care episode that includes all the
covered services for all the providers who would treat the patient, taking
into account the severity and complexity of his or her condition. The goal is
to create an incentive for collaborative care that improves both clinical and
financial outcomes.

This model will be employed by McKesson Episode Management, a highly
configurable, rules-based software application that enables scalable episode
programs with retrospective and prospective bundled payments. The solution
leverages McKesson’s industry-leading solutions for optimizing clinical
decision support and automating even the most complex payment decisions,
enabling plans to implement a wide variety of advanced reimbursement
strategies. McKesson Episode Management automates a health plan’s choice of
episode definitions, then helps bundle and pay episode claims accurately, in
real time and within current claim workflows.

In addition, McKesson will be participating in HCI3’s rigorous certification
process for technology companies employing the PROMETHEUS Payment model.

For more information on McKesson Health Solutions, please visit our Web site,
hear from our experts at MHSdialogue, and follow us on Twitter at
@McKesson_MHS, or join our LinkedIn group.

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About the Health Care Incentives Improvement Institute™, Inc.

The Health Care Incentives Improvement Institute, Inc. (HCI3^®) is a
non-profit multi-stakeholder umbrella organization for Bridges to Excellence^®
and PROMETHEUS Payment^®. The mission of the organization is to create
significant improvements in the quality and affordability of health care by
developing and implementing programs that recognize and reward physicians,
hospitals and other health care providers that deliver safe, timely,
effective, efficient, equitable and patient-centered care. HCI3 offers a
comprehensive package of solutions to employers, health plans and coalitions
to improve the flawed incentives that currently permeate the U.S. health care
system. For more information, visit

About McKesson Corporation

McKesson Corporation, currently ranked 14th on the FORTUNE 500, is a
healthcare services and information technology company dedicated to making the
business of healthcare run better. We partner with payers, hospitals,
physician offices, pharmacies, pharmaceutical companies and others across the
spectrum of care to build healthier organizations that deliver better care to
patients in every setting. McKesson helps its customers improve their
financial, operational, and clinical performance with solutions that include
pharmaceutical and medical-surgical supply management, healthcare information
technology, and business and clinical services. For more information, visit us

Tags: bundled payment, episodes of care, PROMETHEUS Payment, healthcare
reform, value-based reimbursement, McKesson Episode Management, payment
reform, advanced reimbursement


McKesson Health Solutions
Sandra Cummings, 617-273-2890
Public Relations
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