February 2020 ~

On February 20, CMS issued a proposed rule which recommends a three-year extension and changes to the episode definition and pricing in the Comprehensive Care for Joint Replacement (CJR) Model.

The CJR Model was established through notice and comment rulemaking and began on April 1, 2016. The Model was originally designed to run for five performance years with the intent to further CMS’ goals of improving the efficiency and quality of care for Medicare beneficiaries and to encourage hospitals, physicians, and post-acute care providers to work together to improve the coordination of care from the initial hospitalization through recovery.

The Model is currently scheduled to end on December 31, 2020. The rule proposes to extend the length of the CJR Model for an additional three years, through December 31, 2023, for certain participant hospitals. This extension will allow time to evaluate the proposed changes, according to the CMS Fact Sheet.

In the proposal, CMS is also recommending to change certain aspects of the CJR Model, including incorporating outpatient hip and knee replacements into the episode of care definition, the target price calculation, the reconciliation process, the beneficiary notice requirements, gainsharing caps, and the appeals process.

The agency is proposing to make changes to the definition of a CJR ‘episode’ to include outpatient knee and hip replacements in order to address changes to the inpatient-only (IPO) list that now allow for total knee and total hip replacements to be treated in the outpatient setting.

The agency also suggests changing to the basis for CJR target price calculation from three years of claims data to the most recent one year of claims data, to remove the national update factor and twice-yearly update to the target prices that accounts for prospective payment system and fee schedule updates, to remove anchor factors and weights, to incorporate additional risk adjustment to the target pricing and to change the high episode spending cap calculation methodology.

The proposed rule also includes several changes to the CJR reconciliation process. Specifically, according to the fact sheet, the proposed rule has proposed to move from two reconciliation periods (conducted 2 and 14 months after the close of each performance year) to one reconciliation period that would be conducted 6 months after the close of each performance year, to add an additional episode-level risk adjustment beyond fracture status such that target prices will be further adjusted at the episode level based on the individual beneficiary’s age and HCC condition count.  CMS is also proposing to change the high episode spending cap calculation methodology used at reconciliation, to add a retrospective trend adjustment factor that will better capture changes in Medicare program payment updates and care delivery patterns, and to change the quality (effective or applicable) discount factors applicable at reconciliation to participants with excellent and good quality scores to better recognize high-quality care.

For more information about the CJR Model, visit the Comprehensive Care for Joint Replacement Model page; and see the full text of the February 2020 CJR proposed rule, here.

Source(s): Federal Register; CMS Fact Sheet;