Courtesy of Thinkstock


Published 2/1/2016
Alexandra E. Page, MD; Mary I. O'Connor, MD

Unintended Consequences of CJR

Could a value-based program intensify care disparities?
Bundled payments are not only here to stay, they are now being mandated in specific geographic regions, under the Comprehensive Care for Joint Replacement (CJR) program. Although the intent of this payment strategy is to drive value in health care, a likely unintended consequence may be to decrease access to surgical care for certain high-risk patients.

Moving reimbursement from fee-for-service (FFS) strategies toward those that recognize high-value care has been a priority for the Centers for Medicare & Medicaid Services (CMS). In January 2015, CMS announced it would be transitioning 50 percent of FFS payments to alternative payment models (including bundled payments) by 2018. That was followed by a preliminary rule (in July 2015) for the CJR program, which was finalized on Nov. 16, 2015. (See "CMS Finalizes Mandatory Bundled Payment Model," AAOS Now, January 2016.) This program affects all hospitals within 67 geographic regions and mandates bundled payments for all Medicare beneficiaries discharged with diagnosis-related groups 469 and 470 (major joint replacement or reattachment of lower extremity with or without major complications or comorbidities).

Cherry-picking or lemon-dropping?
Bundled payment models can motivate collaboration among all providers across the cycle of care. Procedures such as total knee arthroplasty (TKA) and total hip arthroplasty are prime candidates for bundled payments because costs for most patients can be accurately predicted.

As all surgeons know, complications can occur and radically increase the cost of an episode of care, regardless of adherence to appropriate practices in patient selection, surgical technique, and perioperative care. An unintended consequence of a payment model such as CJR may be the "cherry-picking" of low-risk patients. Health systems and surgeons will be subject to financial incentives to avoid patients at higher risk of complications and, hence, more expensive care. 

Racial, ethnic, and sex disparities already exist in the burden, incidence, and treatment of musculoskeletal disease. When treatment is offered, multiple factors can affect the final outcome of a surgical procedure. As orthopaedic surgeons, we may recommend steps to modify factors such as weight, smoking, and diabetes. However, the orthopaedic literature demonstrates that socioeconomic status can also affect outcomes.

For example, the risk calculator developed by the American Joint Replacement Registry (AJRR) estimates the 2-year risk of periprosthetic TKA infection is 2.77 percent for a 65-year-old African-American woman who has diabetes and obesity and obtains subsidies for her medical insurance. However, a similar patient who is Caucasian and does not receive subsidies has only a 1.55 percent risk of infection.

CMS officials have said that data from the Bundled Payment for Care Improvement (BPCI) project—a predecessor of CJR—would be used to identify unintended consequences such as cherry-picking (increased admissions of relatively healthy patients who are likely to need less complex care) or lemon-dropping (avoiding treatment of high-cost patients).

CJR and risk stratification
The National Quality Forum (NQF) has wrestled with the challenge of including risk stratification in performance measures. Originally, the NQF recommended avoiding risk stratification, arguing that it could perpetuate a tiered system. It posited that equalizing reimbursement to providers and hospitals treating at-risk populations would remove the impetus to improve these outcomes and perpetuate an unequal system of care and outcomes.

In 2014, the NQF reversed its stance, noting that the standards being used in the shift to value-based health care penalized providers serving low-income patients. It recommended including risk adjustment for sociodemographic factors such as income or race. However, to date CMS has not taken this step.

Risk stratification was noted as a potential concern when the preliminary CJR rule was released. CMS responded that no good stratification tools exist and therefore stratification would not be done. Multiple stakeholder groups—including the American Association of Orthopaedic Surgeons (AAOS) and orthopaedic state and specialty societies—continue to express their concern about this failure to include risk stratification.

Speaking at the AAOS-sponsored Orthopaedic Quality Institute last November, CMS Director of Quality Measurement and Health Assessment Kate Goodrich, MD, MHS, noted that hospitals will be able to submit some data on risk variables. Claims data will capture some comorbidity risk factors, and the required Hospital Consumer Assessment of Healthcare Providers and Systems survey includes questions on race/ethnicity, educational level, and language.

Although hospital collection of patient-reported outcome data remains optional, the final rule includes a financial incentive to encourage reporting. In addition, Dr. Goodrich noted that hospitals will report the other risk variables, including single-question spinal pain, lower extremity painful joint count, and narcotic use. Data on race, ethnicity, and the single-item health literacy question can contribute useful information on musculoskeletal disparities.

According to HealthLeaders Media, Francois de Brantes, MS, MBA, the director of the Health Care Incentives Improvement Institute, believes that CMS ignored comments calling for "adjusting for the severity of patients, separating out the various procedures, and allowing provider organizations other than acute care facilities to be responsible for the episode." He added, "We will likely look back and regret the Administration's haste to push out a program with known flaws when it could have done a lot better. On the plus side, the private sector and many state-based initiatives are designing their efforts the right way, so when the next Administration comes in, there will likely be opportunities for course corrections."

CJR represents a bold step in the changing paradigm of healthcare reimbursement, but it has the potential to unintentionally limit access to care for some of the most vulnerable Medicare beneficiaries. Obtaining data to support appropriate risk stratification is the responsibility of healthcare providers and institutions. Payers and policy makers are then responsible for using those data to align reimbursement to the care of higher-risk patients to ensure equal access to care. As physicians, we need to remember that our greatest responsibility is to be advocates for the patients we see.

Alexandra E. Page, MD, chairs the AAOS Health Care System Committee; Mary I. O'Connor, MD, chairs the AAOS Diversity Advisory Board.


  1. AJRR Risk Calculator. Available at: Accessed January 6, 2016.
  2. Commins J: NQF wants risk-adjusted outcomes, costs, payments. Healthleaders Media. November 3, 2014. Accessed November 6, 2014.
  3. Comprehensive Care for Joint Replacement, Final Rule. Available at: Accessed November 17, 2015.
  4. Conway PH, Rajkumar R, Bassano A, Press M, Schreiber C, Scott G: CMS initiative for hip and knee replacements supports quality and care improvements for Medicare beneficiaries. Health Affairs Blog. November 16, 2015. Accessed November 16, 2015.
  5. National Quality Forum: Risk adjustment for socioeconomic or other sociodemographic factors. August 15, 2014. Available at: Accessed June 10, 2015.
  6. Ready T: Bundled pay for joint replacements could boost quality. HealthLeaders Media. November 19, 2015.
  7. Accessed November 28, 2015.