Why this Newsletter
In the summer of 2024, Center for Medicare and Medicaid Services finalized its Transforming Episode Accountability Model (TEAM), a mandatory Medicare bundled payment model that roughly one in ten hospitals in the United States will be required to participate in. Here’s why TEAM is significant for hospital customers.
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TEAM is a mandatory five-year bundled payment program which begins on January 1, 2026, with an objective to improve quality and reduce costs by promoting care coordination throughout a patient’s episode.
Under the model, over 700 selected U.S. acute-care hospitals would coordinate care for Medicare beneficiaries who undergo one of the following five episodes: lower extremity joint replacement, surgical hip femur fracture treatment, spinal fusion, coronary artery bypass graft, and major bowel procedures. An episode ends 30 days after discharge from the initial anchor stay or procedure.
Each hospital participating in TEAM will be required to refer patients to primary care services to support continuity of care and positive long-term health outcomes. According to the Center for Medicare and Medicaid Innovation (CMMI), TEAM will be mandatory for over 700 select hospitals based on core-based statistical areas (CBSAs), covering over 200,000 episodes annually.
CMS’ introduction of TEAM represents a significant shift in how hospitals will engage with value-based care. Unlike previous voluntary programs, TEAM requires participation from approximately one in ten U.S. hospitals, with the potential for expansion in the future. This is especially important given Medicare’s plan to have 100% of all Medicare fee-for-service beneficiaries in value-based care models like TEAM by 2030.
Because TEAM is its mandatory nature, this eliminates the option for hospitals to selectively participate. Instead, hospitals must engage in all five episodes of care. This comprehensive approach aims to standardize care delivery and ensure that all participating hospitals are equally accountable for their performance across the five episodes.
TEAM also introduces significant financial implications. In the first year, hospitals can earn a maximum 10% upside but in subsequent years, the risk increases to 20% upside and 20% downside. This risk structure creates a substantial financial incentive for hospitals to improve their operational efficiency and patient outcomes.
The mandatory nature of the program, combined with the financial risks and rewards, underscores the importance of TEAM in driving quality improvement, reducing costs and advancing Medicare’s goal of 100% of all fee-for-service care to 100% value-based care by 2030.
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About Rowinski Group
2025 marks the 21st year in business for Rowinski Group LLC. Rowinski Group is a reimbursement and healthcare payer data analytics consultancy for medical device, digital health and diagnostics companies who are developing and selling their medical technology for the U.S healthcare market. Rowinski Group has offices in Silicon Valley – San Francisco Bay area and Chicago, Minneapolis, and Raleigh.
Rowinski Group has two core service offerings; securing codes and reimbursement on behalf of companies and applying healthcare payer data analytics to help companies solve business issues such as responding to questions from the FDA and Medicare, sales forecasting, Key Opinion Leader (KOL) identification etc.
Through these service offerings Rowinski Group help U.S. and international companies build their U.S. market share for the medical technology they are developing and selling. For more information visit https://reimbursement.consulting or contact Daniel Zimmerman d.zimmerman@reimbursement.consulting.
