In a proposed rule announced on July 25, 2016, the Department of Health and Human Services (HHS) and the Centers for Medicare & Medicaid Services (CMS) introduced three new Episode Payment Models (EPMs) for episodes of care surrounding acute myocardial infarction, coronary artery bypass graft, and surgical hip/femur fracture treatment, excluding lower extremity joint arthroplasty (SHFFT). The SHFFT model expands on the list of Medicare mandatory models for orthopaedic surgery that already includes the Comprehensive Care for Joint Replacement (CJR) model by adding surgical treatments for hip and femur fractures beyond replacement (ie, hip fixation), and will begin on July 1, 2017, continuing for 5 performance years.

CMS expects the SHFFT bundle to enroll 109,000 patients and save the system $4.9 billion annually. Further, the proposed rule also states that, starting in 2018, both the CJR and the SHFFT models will include a track that will qualify as an Advanced Alternative Payment Model (APM). In addition, a voluntary bundled payment model that will qualify as an Advanced APM will be introduced.

As proposed, SHFFT is a mandatory model and will be implemented in the Metropolitan Statistical Areas already subject to CJR. SHFFT will be a 90-day bundle initiated by inpatient admission under MS-DRG (Musculoskeletal Diagnosis-Related Groups) 480–482 (all acute femur fractures—hip and femur procedures except major joint). The bundle will include all Part A and Part B components for 90 days. As with CJR, this will be a retrospective bundle, owned and run by the hospital. Setting the target EPM price will follow the methods used in CJR, with transition from hospital to regionally based benchmarks over a 3-year period. Further, quality scores will be calculated similarly to arthroplasty patients in CJR (Table 1). Hospitals that are currently participating in CJR will be required to participate in SHFFT. Providers who are not currently involved in CJR will not be affected at this time.

CMS proposed the SHFFT model "to incentivize improvements in the coordination and quality of care, as well as episode efficiency, for beneficiaries treated surgically for hip and femur fractures, other than hip arthroplasty." Together, the CJR and SHFFT models cover all surgical treatment options for lower extremities among Medicare beneficiaries.

A quick SHFFT
Do things seem to be moving too quickly? At this time, no published results for the CJR demonstration are available to show that it is an effective bundle. Harvard professors Robert S. Kaplan, PhD, and Michael E. Porter, PhD, both experts in the field of healthcare reform and proponents for bundled payments, make the case that the government should pay for value, rather than volume, in health care. Value can be defined as relevant outcome divided by the total cost of all necessary services throughout the care cycle. "Results," or specific outcomes that matter, are contingent upon the condition.

Dr. Kaplan notes that outcomes and payment for a patient with diabetes would be different from those for a patient with heart disease or those for a healthy adult. Value is determined on a per-patient and per-condition basis. It is unclear whether CJR and SHFFT actually incorporate these principles.

However, this proposal follows the CMS-declared goal of having 50 percent of traditional Medicare payments flowing through APMs by 2018. The proposed rule also offered a way for the CJR and SHFFT models to qualify as Advanced APMs under the new Quality Payment Program (which implements the Medicare Access and CHIP Reauthorization Act [MACRA]).

Under the MACRA Final Rule published on Oct. 14, 2016, Advanced APMs must meet the following requirements:

• Be a CMS Innovation Center model, or participate in shared savings program tracks or certain federal demonstration programs.
• Use certified EHR technology.
• Base payments for services on quality measures comparable to those in the Merit-based Incentive Payment System.
• Be a medical home model expanded under Innovation Center authority or require participants to bear more than nominal financial risk for losses. The final rule defined the risk requirement for an Advanced APM to be in terms of either total Medicare expenditures or the participating organizations' Medicare revenue (which may vary significantly). This is an enhanced flexibility that enables the creation of more Advanced APMs.

Currently, the CJR (and SHFFT) models do not have Certified Electronic Health Record Technology (CEHRT) requirements, and hence do not qualify as Advanced APMs. The new proposed track will introduce the requirement of using CEHRT (CEHRT track), thereby making these new model tracks qualify as an Advanced APM.

Performance measures
In the absence of solid performance measures, CMS tends to define quality as the perception of the patient's experience. In the SHFFT rule, CMS stated, "We considered an alternative approach to the required quality measures for the SHFFT model given that the proposed measures do not specifically target the SHFFT model beneficiaries. This alternative approach would not account for any hip-specific measures (such as, hospital-level risk-standardized complication rate following elective primary total hip arthroplasty and/or total knee arthroplasty [NQF #1550 Hip/Knee Complications]) and would instead only measure patient experience through the HCAHPS (Hospital Consumer Assessment of Healthcare Providers and Systems) Survey (NQF #0166).

"Although there may be some rationale for excluding measures that do not specifically target SHFFT model beneficiaries, we do not propose this approach to SHFFT model quality measures because we believe that it is critical to include a measure of both clinical and patient experience outcomes in the setting of lower extremity orthopedic surgery episodes. Additionally, we believe that using quality measures for SHFFT model episodes that do not align with those in the CJR model could generate confusion at CJR model participant hospitals where we propose that the SHFFT model be tested as discussed in section III.B.4. of this proposed rule."

In the SHFFT rule, CMS stated: "While we recognize that none of the proposed measures specifically target the care of SHFFT model beneficiaries, these measures are the same as those used for the CJR model because SHFFT model episodes will be tested along with the lower extremity joint replacement episodes in the CJR model (80 FR 73501 and 73507) at mostly the same hospitals."

AAOS leadership has stated its concerns about the lack of physician consultation in the development of these bundled reforms. Another issue is the absence of risk adjustment in either CJR or SHFFT, because it is unrealistic to expect similar outcomes for a healthy 70-year-old who falls and sustains an intertrochanteric hip fracture and for a 70-year-old patient with end-stage renal disease who is on dialysis and sustains a similar fracture. Some observers argue that hospitals caring for sicker patients are likely to see greater penalties than those with a healthier patient base.

Further, beyond patient factors, not all fractures are the same. The 90-day care needs of a 70-year-old patient with a low-energy intertrochanteric fracture will be vastly different from a similar patient who requires open reduction and internal fixation for a comminuted intra-articular distal femur fracture sustained in a vehicle crash.

Lastly, many fracture patients require the use of postacute care inpatient rehabilitation services. The challenge for the anchor hospital will be finding partners in the community and controlling the quality and cost of care at these facilities.

What can and should orthopaedic surgeons do? First, leverage the collaborations between AAOS and specialty societies to help develop voluntary, surgeon-led bundles. AAOS and specialty societies need to work together to develop and publish quality and performance metrics that are condition- and patient-specific. These actions better align with the view of Drs. Kaplan and Porter that specific outcomes that matter. Finally, successful programs in CJR and SHFFT need to communicate any "best practices" so that all providers will have the opportunity to become more effective under the new paradigm.

Laura Phieffer, MD, is a member of the AAOS Health Care Systems Committee. Alexandra E. Page, MD, is chair of the Health Care Systems Committee. Douglas W. Lundy, MD, MBA, is the Health Policy Committee chair of the Orthopaedic Trauma Association and a member of the AAOS Now editorial board.

Glossary
Despite the use of multiple acronyms, the CMS proposed rule covers 905 pages. Even experienced readers may need a "cheat sheet" to understand the documentation; the following glossary is provided to assist comprehension.

APM—Alternative Payment Model; new approaches to paying for medical care through Medicare that incentivize quality and value (examples: accountable care organizations, episode-based payments, and patient-centered medical homes). A component of payment is tied to value in each model.

BPCI—Bundled Payments for Care Improvement initiative; comprised of four broadly defined CMS models of care that link payments for the multiple services beneficiaries receive during an episode of care.

CEHRT—Certified Electronic Health Record Technology; a requirement for qualification to become an advanced APM.

CJR—Comprehensive Care for Joint Replacement model; a retrospective bundled payment model designed by CMS that holds hospitals accountable for episodes of care extending 90 days postdischarge (includes all related Part A and Part B services) for lower extremity joint replacement procedures. It includes a per-episode discount of up to 2 percent and is mandatory in 67 geographic areas, defined by MSAs (see below). Began April 1, 2016.

EPM—Episode Payment Model; the hospital in which a patient is admitted for care for an "episode" (ie, surgical hip/femur fracture) would be accountable for the cost and quality of care provided to Medicare fee-for-service beneficiaries during the inpatient stay and for 90 days after discharge.

MSA—Metropolitan Statistical Area; one of the 67 geographical areas associated with a core urban area with a population of at least 50,000 and close economic ties throughout the area that are involved in CJR.