Mark I. Froimson, MD


Published 4/1/2016
Elizabeth Fassbender

BPCI, CJR, and Other Emerging Payment Models in Orthopaedics

With the Comprehensive Care for Joint Replacement (CJR) program set to start on April 1, 2016, the AAOS Annual Meeting symposium "Bundled and Emerging Payment Models in Orthopaedics" provided a unique opportunity to evaluate current programs and discuss impending changes in reimbursement. AAOS immediate Past-President David D. Teuscher, MD, provided an overview of the symposium, while Kevin J. Bozic, MD, MBA, moderated a panel of speakers who discussed the issues involved in transitioning from fee-for-service (FFS) to value-based payment models in orthopaedics.

The move toward bundled payments
In 2011, the Centers for Medicare & Medicaid Services (CMS) initiated the Bundled Payments for Care Improvement (BPCI) program, which included four models of bundled payments. By 2015, according to CMS, more than 2,100 acute care hospitals, skilled nursing facilities, physician group practices, long-term care hospitals, inpatient rehabilitation facilities, and home health agencies had transitioned from "a preparatory period to a risk-bearing implementation period."

According to Mark I. Froimson, MD, these kinds of alternative payment models (APMs) can be beneficial to physicians if they know how to use them. He highlighted a recent CMS announcement that an estimated 30 percent of Medicare payments are now tied to APMs that reward quality of care over quantity of services provided to beneficiaries. This movement is the result, in part, of goals set by the Department of Health and Human Services (HHS) in January 2015. HHS has also stated it expects to have 50 percent of all Medicare FFS payments made via APMs by 2018. "It behooves us to get on board," Dr. Froimson said.

Physicians will be better poised to succeed with these new programs if they think of them as care improvement first, according to Dr. Froimson, noting that physicians should welcome the changes. "This is about providing better care that is going to differentiate us from our competitors," he said. Dr. Froimson also stressed that because the CJR program is here and it is mandatory, it is "important to learn how to succeed in this model."

The CJR program bundles payment and quality measures for hip and knee replacements at hospitals in 67 geographic areas. Although there is no downside financial risk for the participating hospitals in the first year, there are stop-loss limits of 5 percent in performance year 2, 10 percent in year 3, and 20 percent in years 4 and 5. Further, payments are tied to quality, including patient-reported outcomes, and gainsharing is available in situations where the participant hospital arranges to engage in care redesign strategies and services with physicians and other CJR collaborators (such as physicians).

Mark I. Froimson, MD
Michael Suk, MD

AAOS has commented to CMS that although orthopaedic surgeons have been leaders in developing, implementing, and evaluating episode of care payments, further refinement of the CJR program—including addressing risk-adjustment and designated physician leadership—may be required. AAOS commented on the CJR program in November 2015, with Dr. Teuscher stating that "the AAOS supports efforts by CMS to make appropriately structured alternative payment models available to physicians and other providers, [but] we are very concerned about serious unintended consequences for Medicare beneficiaries and physicians."

Dr. Froimson noted that the CJR program is unique because it is mandatory and hospitals alone are the initiators. He stressed, however, that patients have to be engaged and accountable, too, especially in managing comorbidities such as a high body mass index, and that physician leadership is key. Many opportunities exist to impact outcomes during an episode of care, from patient education to acute care delivery and rehabilitation and recovery protocol. "Invest the time up front to involve patients and their families in the process. The engaged and educated patient is your greatest asset," he said.

Gainsharing and population health
Anita Pramoda urged physicians who are considering gainsharing agreements to first get a good lawyer and second, ensure transparency. Ms. Pramoda, currently the co-founder of an online venture that coordinates healthcare services for senior citizens, was the chief financial officer of Epic Systems Corp. from 2009 to January 2012. She also suggested that capital, information technology, and expertise outside the operating room are necessary to ensure success. Most importantly, instead of measuring everything, physicians should "push really hard for measuring what matters. Ultimately, quality happens at the physician level," she said.

Finally, Michael Suk, MD, discussed the role of orthopaedics in population health management. "Everyone knows there is something called value-based care and most people know about bundles, but today, it is about creating systems to support the medical profession's success and change provider behavior," he said. He echoed Dr. Froimson's belief that there are many opportunities for improvement in areas such as pre-surgery, surgery, and post-surgery. "Tomorrow," he said, "will be about evolving those systems to support patient success and change patient behavior—that is where we create population health."

For more information on the CJR program and other Medicare payment issues, visit

Elizabeth Fassbender is the communications manager in the AAOS office of government relations. She can be reached at