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AAOS Now

Published 9/1/2016
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Shreyasi Deb, PhD, MBA

CMS Proposes Update to Existing CJR Model

Rule also includes voluntary BPCI model, new Advanced APM pathway
On July 25, 2016, the Department of Health & Human Services and the Centers for Medicare & Medicaid Services (CMS) proposed new models that increasingly include quality metrics for physician payment. Apart from introducing new mandatory cardiac care bundles and cardiac rehabilitation incentive payments, the proposal provides an update to the existing mandatory joint replacement bundled payment model (ie, the Comprehensive Care for Joint Replacement [CJR] model). It also includes a new voluntary model under the Bundled Payments for Care Improvement (BPCI) initiative, and creates a new pathway for physicians to qualify for increased payment incentives through the Advanced Alternative Payment Models (Advanced APMs) under the proposed Quality Payment Program (QPP). This article focuses on items in the proposed rule that are relevant to orthopaedic surgeons.

New hip fracture bundle
One of the new episode payment models (EPMs) proposed is the surgical hip/femur fracture treatment model (SHFFT), which builds on the CJR model and will be tested in the same 67 Metropolitan Statistical Areas. The 5-year demonstration of the SHFFT model, which qualifies as an Advanced APM, will begin on July 1, 2017.

The care episode would begin with an inpatient admission to an "anchor hospital," and be triggered by a discharge diagnosis of Medicare Severity-Diagnosis Related Group 480-482. The episode would include the inpatient stay and all related services provided under Medicare Parts A and B within 90 days after discharge, including hospital care, post-acute care, and physician services, with very limited exceptions.

As under CJR, the episode initiator hospital will be required to bear all financial risks and can enter into gainsharing contracts with other providers. SHFFT participants will be required to report the same quality measures used in the CJR model, as follows:

  • Hospital-level Risk Standardized Complication Rate following elective primary Total Hip Arthroplasty (THA) and/or Total Knee Arthroplasty (TKA) (National Quality Forum [NQF] #1550) (Hip/Knee Complications)
  • Hospital Consumer Assessment of Healthcare Providers and Systems Survey (NQF #0166)
  • THA/TKA voluntary patient-reported outcome and limited risk variable data submission

Pathway for physician participation in an Advanced APM
Per the QPP Proposed Rule published in May 2016, beginning with calendar year 2019, eligible clinicians who participate in Advanced APMs can become Qualifying APM Participants and receive an APM Incentive Payment for the year. In later years, they would receive a more favorable payment update under the Physician Fee Schedule.

In the current rule, CMS proposes to implement two different tracks within the EPMs to ease physician participation in Advanced APMs. EPM participants who meet proposed requirements for use of Certified Electronic Health Record Technology (CEHRT) and financial risk would be in Track 1 (an Advanced APM track) and EPM participants who do not meet these requirements would be in Track 2 (a non-Advanced APM track).

In each of the EPMs, Track 1 involves the following:

  • requires participants to bear risk for monetary losses that meet the proposed nominal risk criteria (For example, for an APM to meet the nominal amount standard for being considered an Advanced APM, the specific level of marginal risk must be at least 30 percent of losses in excess of expected expenditures; a minimum loss rate must be no greater than 4 percent of expected expenditures; and total potential risk must be at least 4 percent of expected expenditures.)
  • uses quality measures that meet the proposed measure requirements for base payments
  • requires participants to report on their use of CEHRT

Extension of the CJR and BPCI models
Per the QPP Proposed Rule published in May 2016, both CJR and BPCI did not qualify as Advanced APMs. In this rule, CMS proposes that participants in the CJR and a new voluntary model within the BPCI will qualify for Advanced APM reimbursement as long as they meet the EPM Track 1 requirements discussed above.

CMS proposes to add other hospitals, including critical-access hospitals and accountable care organizations (ACOs), as potential collaborators in the CJR model. CMS also proposes to provide hospitals with additional utilization and spending data to help improve care coordination.

This proposed rule allows certain Medicare program waivers across all three proposed EPMs, including telehealth originating site requirements and the general waiver to allow post-discharge nursing visits in the home. It also provides certain model-specific waivers, such as limits to the number of post-discharge nursing visits and the skilled nursing facility 3-day stay.

Gainsharing payments must be derived solely from reconciliation payments, internal cost savings, or both, and be distributed on an annual basis (not more than once per calendar year). They cannot be a loan, advance payment, or payment for referrals or other business and must be clearly identified as gainsharing payments at the time of remittance.

Moreover, a CJR collaborator must meet the quality of care criteria (established by the participant hospital) for the performance year for which the CJR participant hospital accrued the internal cost savings.

In addition, the proposed rule announced CMS' intent to build upon the BPCI initiative with a new voluntary bundled payment model—to begin in calendar year 2018—that would also potentially qualify under the proposed criteria for Advanced APMs.

Implications and looking ahead
In their interaction with the American Association of Orthopaedic Surgeons (AAOS) leadership, as well as in the proposed rule, CMS has stated that future models with the potential to be Advanced APMs are likely to emphasize outpatient care and care coordination. Such future condition-specific EPMs may provide for a transition from hospital-led EPMs to physician-led accountability for episode quality and costs, given the significance of long-term care management for beneficiaries with multiple chronic conditions. This would be one of the guiding principles in developing orthopaedic episodes of care in the future.

AAOS has long argued that Medicare beneficiaries who receive care for hip fractures are mainly frail elders with a significantly different risk profile from patients who receive elective hip and knee arthroplasty. The AAOS, therefore, lauds CMS' acknowledgement of this difference by creating a separate SHFFT model. Moreover, given the high participation rate of orthopaedic surgeons in BPCI models across the country, AAOS is encouraged by the new voluntary BPCI model and the announced pathways for physicians to receive increased Advanced APM payments. Allowing ACOs and other hospitals to collaborate with the episode initiator hospital in the CJR model will also create participation opportunities for orthopaedic surgeons.

However, AAOS is concerned that the SHFFT model, akin to the CJR model, continues to be a hospital-led bundle, is a mandatory EPM, and has a short implementation timeline. Furthermore, AAOS would like to see more details on physician gainsharing guidelines, as well as results of the existing BPCI model evaluations. The AAOS will collaborate with orthopaedic specialty societies in providing comments on this proposed rule, which are due to CMS by Oct. 3, 2016.

Shreyasi Deb, PhD, MBA, is senior manager, health policy, in the AAOS office of government relations. She can be reached at deb@aaos.org

Bottom Line

  • A new proposed rule by CMS would introduce a bundled payment program for surgical treatment of hip and femur fractures.
  • CMS is proposing two tracks for physicians participating in bundled payment programs.
  • The proposed rule spells out requirements for gainsharing payments.
  • The AAOS is reviewing aspects of the rule that are relevant to orthopaedic surgeons and will submit comments to CMS this month.

Additional Information: