Comprehensive Care for Joint Replacement (CJR)

General Model Implementation

Introduction Jonathan H. Besler, CPABesler Consulting thinks it is very important that hospital financial stakeholders become familiar with CJR even if their hospital isnt currently a participant. We hope this series of presentations from our CJR Special Report is helpful in your efforts to prepare for CJR and an eventual expansion of bundled payments by CMS.

Jonathan H. Besler, CPAPresident and CEOBESLER Consulting

http://www.besler.com/comprehensive-care-for-joint-replacement-cjr/?utm_campaign=2016-04 CJR special report&utm_medium=social&utm_source=slideshare

CJR Program SummaryThe CJR model is effective April 1, 2016 and is set to continue through five performance periods ending on December 31, 2020.

CMS is implementing this model via its authority under section 1115A of the Social Security Act as modified by Section 3021 of the Affordable Care Act, which established the Center for Medicare and Medicaid Innovation (CMMI).

CMMI was created to test new payment and service delivery models with the goals of reducing CMS program expenditures while maintaining or improving outcomes.

CJR Program SummaryCJR will test a new bundled payment model for inpatient lower extremity (i.e. hip and knee) joint replacements.

CMS will calculate a target price for the inpatient procedures and all costs of related care (both Part A and Part B) for the 90 day period following discharge.

Participating hospitals will be assigned individual target prices for CJR episodes and may receive a portion of any savings compared to the target price and be responsible for repayment of any expenditures above the target price.

CJR Program SummaryHospital quality measures are a component of the annual episode payment reconciliation.

Providers have the opportunity to establish gain and risk sharing relationships with other providers of care to CJR beneficiaries.

CMS is implementing a number of program waivers during CJR testing. Unlike voluntary programs such as BPCI, with few exceptions participation in CJR is mandatory for hospitals in 67 selected MSAs.

General Model ImplementationCJR is being implemented via the CMMI to test a mandatory bundled payment model for lower extremity joint replacements (LEJR) for five performance periods beginning on April 1, 2016 and ending on December 31, 2020.

By making the program mandatory, CMS hopes to evaluate the program in a variety of hospital settings and geographic areas.

General Model ImplementationA CJR episode begins with an inpatient discharge under MS-DRG 469 or 470 and includes all related Part A and B services for the next 90 days.

CMS calculates a target price for various episode categories, and calculates total actual expenditures for each episode. Under certain circumstances described below, hospitals may share in savings when actual expenditures are below the target price and bear responsibility for expenditures over the target price.

General Model Implementation

CMS will reconcile the expenditures vs. the target prices on an annual basis. As claims are processed, all providers involved in the CJR episode will be paid as usual under the then-current IPPS and OPPS regulations.

In short, CJR risk and opportunity is calculated on a retrospective basis; hospitals are not provided with a flat rate payment at the time of service for a CJR episode.

General Model Implementation

Hospitals may form relationships with other providers involved in the post-discharge treatment of CJR patients in order to share risk and potential performance payments.

Hospitals will not be at risk for expenditures higher than the target price during the first performance period.

General Model Implementation

CMS expects the first performance period to be a time for hospitals to analyze their operations to identify opportunities to improve efficiency, form risk-sharing partnerships, etc. Hospitals can earn payments from CMS in the first performance period if CJR expenditures are below the target prices set by CMS.

General Model ImplementationAn important tenet of the CJR program is that, regardless of any risk-sharing relationships that participant hospitals establish, CJR beneficiaries retain the ability to use any provider they choose.

CMS will be watching for any trends related to CJR services being provided differently than usual under the program, including service timing and selection of providers.

General Model Implementation

CMS expects CJR to save over $340M over the five performance years while maintaining or improving quality of care for LEJR cases.

To download the full CJR report, click on the image below

http://www.besler.com/comprehensive-care-for-joint-replacement-cjr/?utm_campaign=2016-04 CJR special report&utm_medium=social&utm_source=slidesharehttp://www.besler.com/comprehensive-care-for-joint-replacement-cjr/?utm_campaign=2016-04 CJR special report&utm_medium=social&utm_source=slideshare