Federal Regulatory Accomplishments

The AAOS Office of Government Relations’ regulatory efforts ensure that orthopaedic concerns are addressed even after the conclusion of the legislative process and throughout agency rulemaking and implementation stages. To this end, the regulatory staff works closely with Department of Health and Human Services agencies such as the Federal Drug Administration (FDA), Centers for Medicare & Medicaid Services (CMS), Agency for Healthcare Research and Quality (AHRQ), and the Centers for Disease Control and Prevention (CDC). In addition, expertise in coding, reimbursement, and payment policy is shared across the Academy and with our members. The Office of Government Relations also houses the AAOS’ practice management information and educational efforts. Both of these are key services to our fellowship and members.

Health Information Technology 

In response to AAOS and others efforts, CMS made changes under the Medicare electronic health record (EHR) Incentive Program allowing all returning participants in the EHR Incentive Programs to report on a 90-day EHR reporting period in 2016 and 2017. AAOS and other provider groups argued that a year-long reporting period was too tough and would force providers to abandon the meaningful use program, putting it at risk. For 2017, CMS is also aligning the specific CQMs available to EPs participating in the Medicaid EHR Incentive Program with those available to professionals participating in the Merit-based Incentive Payment System (MIPS). In addition, AAOS urged CMS to remove the requirement for providers to upgrade to 2015 Edition Certified EHR Technology (CEHRT), as most EHR developers have not yet met the 2015 CEHRT requirements and CMS has adopted final policies to allow healthcare providers to use either 2014 Edition CEHRT, 2015 Edition CEHRT, or a combination of 2014 Edition and 2015 Edition CEHRT, for an EHR reporting period in 2018.

Pain Management category of HCAHPS
AAOS has sent comment letters reiterating that payment incentives for higher scores on the Pain Management dimension of the HCAHPS survey may have created the unintended consequence of overprescribing opiates in the inpatient setting. AAOS maintains that it is unreasonable to expect physicians to solve the opioid crisis during an acute pain episode. CMS is replacing the pain management questions in the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) Survey to focus on the hospital’s communications with patients about the patients’ pain during the hospital stay beginning with surveys administered in January 2018.  

Accrediting Organizations (AOs)
In early 2017, CMS proposed to revise the application and re-application process for Accrediting Organizations (AOs), specifically related to transparency by requiring AOs to post provider/supplier survey reports and plans of corrections from CMS-approved accreditation programs on their public-facing websites. AOs currently do not make their survey reports and acceptable PoCs from their CMS-approved accreditation programs publicly available. AAOS opposed the publication of quality improvement surveys and plans of correction by accrediting organizations (AO) in current form. After consideration of the comments received, CMS decided that it would be best if the proposal was not finalized and instead, the proposal was withdrawn.

Accounting for Social Risk Factors and Risk Stratification

In comment letters to CMS, AAOS has urged CMS that risk stratification and adjustment are equally significant components of valid quality assessment. Outcome measures are only reliable in a relative sense, as a means to compare baseline and post- care status. Comorbidities, functional impediments, and cognitive limitations must be accounted for when assessing quality and costs. Importantly, the effects of multiple co-morbidities and social factors are often synergistic. Providers should not be financially penalized when caring for patients with greater needs. CMS has recognized the importance of risk stratification and adjustment and has said they will consider the analyses and recommendations from a report that analyzes the effects of certain social risk factors in Medicare beneficiaries on quality measures and measures of resource use used in one or more of nine Medicare value-based purchasing programs, as well as reports that include considerations for strategies to account for social risk factors in these programs. Furthermore, CMS awaits the recommendations of the National Quality Forum (NQF) trial on risk adjustment for quality measures.


After consideration of comments from AAOS and others that CMS received, CMS is reassigning the following TAR procedure codes from MS DRG 470 to MS DRG 469, even if there is no MCC (Major complication or comorbidity) reported for FY 2018. As the Medicare claims data demonstrated, there is substantial cost difference between TAA and other lower extremity joint replacements.

AAOS continues to work on issues related to coding and reimbursement including the proposed National Correct Coding Edits (NCCI) procedure-to-procedure edits, the proposed CMS Medical Unlikely Edits, and issues related to ICD-10CM and ICD-10PCS. In addition, AAOS develops educational material in preparation for the 2016 ICD-10CM and ICD-10PCS implementation and updates to the Academy’s coding products such as the Global Service Data for Orthopaedic Surgery publication and Code-X.

Two Midnight Rule

After several letters from AAOS and other organizations, on August 2, 2016, CMS published a final rule that eliminates the agency’s two-midnight policy, which cut Medicare inpatient reimbursements. CMS detailed the removal of the controversial 0.2 percent payment reduction associated with the agency’s two-midnight rule. CMS also announced that it will pay back hospitals for the years the cut was in place. Under the original two-midnight rule, which started in October 2013, CMS said Medicare Part A payment generally was not appropriate for hospital stays not expected to span at least two midnights. Instead, CMS felt that shorter stays are considered outpatient and should be paid at the lower outpatient rate.

Comprehensive Care for Joint Replacement (CJR) Program

On July 25, 2016, the Department of Health and Human Services (HHS) and the Centers for Medicare and Medicaid Services (CMS) announced changes that could allow the CJR model (and the new surgical hip/femur fracture treatment (SHFFT) model) to qualify as an Advanced Alternative Payment Model (APM) beginning in 2018. In addition, the rule announced CMS’s 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. The creation of new pathways for these models to qualify as Advanced APMs is a direct result of AAOS engagement with the CMS and the Center for Medicare & Medicaid Innovation leadership to discuss CJR methodology and bundling.

Orthopaedic Alternative Payment Model Development 

AAOS is supporting and collaborating on the American College of Surgeons’ (ACS) Alternative Payment Model (APM) project submission to the MACRA-established Physician-Focused Payment Model Technical Advisory Committee (PTAC).

Medicare Access and CHIP Reauthorization Act (MACRA) of 2015

On October 14, 2016, the U.S. Centers for Medicare & Medicaid Services (CMS) released the final rule for Medicare’s Quality Payment Program, which implements the Medicare Access and CHIP Reauthorization Act (MACRA) and replaces the Sustainable Growth Rate (SGR) formula. AAOS submitted comments to CMS that outlined a number of areas of concern with the original proposal, including the implementation timeline, restrictive requirements for Advanced Alternative Payment Models (APMs), and the impact on smaller or solo practices. AAOS also responded to CMS’ Request for Information (RFI) regarding MIPS implementation, APM promotion, and incentive payments for participation in eligible APMs. In addition, AAOS provided comments to CMS on its Quality Measure Development Plan (MDP) as well as the MACRA RFI on patient relationship categories. As a result of these comments, one of the changes from the proposed rule is that CMS expects more small practices to be excluded from the Merit-based Incentive Payment System (MIPS) reporting requirements due to a low-volume threshold, which has been set at less than equal to $30,000 in Medicare Part B allowed charges or less than or equal to 100 Medicare patients. This low volume threshold has been raised from what was initially proposed in response to stakeholder comments (the proposed rule called for a threshold of $10,000 in annual Medicare revenue and less than 100 Medicare patients).

In the final rule, CMS also detailed the “Pick Your Pace” flexibility, which is designed to give both clinicians and CMS time to build capabilities and gain experience with the program. In addition, CMS further reduced reporting requirements, extended the MACRA “transitional” period into 2018, and will allow physicians to participate in virtual groups beginning in 2018. Further, as mandated by the MACRA statute, $100 million in technical assistance will be available to MIPS eligible clinicians in small practices (15 clinicians or less), in rural areas, and in practices located in geographic health professional shortage areas (HPSAs). CMS also announced that the agency is leading an outreach effort to individual clinicians nationwide to help them prepare for the Quality Payment Program and improve the clinician experience with Medicare. Finally, per the MACRA statute, CMS is working with the U.S. Government Accountability Office (GAO) to submit a report to Congress, no later than January 1, 2017, on whether entities that pool financial risk for physician practices, such as independent risk managers, can play a role in supporting these small practices.

Visit the AAOS MACRA resource page for all materials and updates: www.aaos.org/macra. For any questions, concerns, or comments, email macra@aaos.org.

CMS Position on Shoulder Coding Issues 

AAOS worked with CMS officials to successfully eliminate National Correct Coding Initiative (NCCI) edits for certain shoulder code pairs, arguing that the shoulder is technically three anatomic synovial joints and two articulations. The CMS policy had allowed the agency to deny payments when these procedures are performed or billed together. Specifically, their edits have denied CPT code 29823, Arthroscopic Shoulder Debridement, extensive, with several other arthroscopic shoulder procedures such as CPT code 29827, Arthroscopic Rotator Cuff Repair, or CPT code 29824, Arthroscopic Distal Claviculectomy.

Since 2010, AAOS, the American Orthopaedic Society for Sports Medicine, the Arthroscopy Association of North America, and the American Shoulder and Elbow Surgeons have sought to change these particular shoulder edits. The societies wrote multiple letters to and had multiple conference calls and face-to-face meetings with CMS and the NCCI. CMS consequently shared a letter with AAOS indicating they would remedy the shoulder coding issue. The deletions were effective as of the July 1, 2016 version of the NCCI.

“This is a great win for orthopaedic patients and we are extremely pleased that CMS fully understood and adopted our perspective,” wrote AAOS President Gerald R. Williams, Jr., MD in a letter to Reps. Tom Price, MD (R-GA) and John Barrasso, MD (R-WY), who urged CMS to hear AAOS concerns.

CMS CY 2017 Payment System Rules 

AAOS submitted comments to the CMS on issues solicited and germane to the practice of orthopaedic surgery for the following proposed and final rules: CY 2017 Medicare Physician Fee Schedule (MPFS), CY 2017 Hospital Outpatient Prospective Payment System (OPPS), and Ambulatory Surgery Center (ASC) Payment System Proposed Rule. 

Global Surgery Codes in the 2017 MPFS

In the 2017 Medicare Physician Fee Schedule (MPFS) proposed rule, CMS outlined policies related to data collection of resources used in the provision of global services. Global services refer to services in the fee schedule with 010 or 090 day global periods. This proposal is in response to the Section 523(a) of the Medicare and CHIP Reauthorization Act (MACRA) of 2015 to not implement CMS’s previously announced policy to eliminate all 010 and 090 global periods and collect accurate data related to the resources utilized in these services starting January 1, 2017. CMS proposed a three-pronged approach to data collection:

  1. Claims-based reporting. Create eight G-codes that all providers would report in 10 minute intervals to capture inpatient, outpatient, office, and non-face-to-face post-operative patient encounters provided in a global period
  2. Conduct a survey of surgeons and providers who commonly perform global services
  3. Conduct field studies in a select number of sites with direct observation of practice patterns.

In response, AAOS commented that such an initiative is a great burden on physicians and practices who may need to report unpaid G-codes 20-50 times post-op in a 90 day global period. Such activities are likely to compromise patient care as time and resources are spent on reporting. Also, the burden will be greater on small practices. Consequently, higher reporting rated by larger (urban/suburban) practices may skew the resource use report. Further, typical services as defined by CMS may not be so typical. AAOS further argued that this proposal exceeds congressional intent in MACRA and CMS should review and revise their proposal. AAOS attended a CMS Town Hall event and a webinar on the topic and AAOS is also conducting a parallel legislative advocacy action on this issue with the Surgical Coalition led by the American College of Surgeons.

TKA out of the IPO list in the 2017 OPPS 

CMS proposed to remove Total Knee Arthroplasty (TKA) from the Medicare Inpatient Only (IPO) List. AAOS joined AAHKS in commenting that all outpatient surgery centers may not be ready for that as yet since such a move would require very careful patient selection and infrastructure. AAOS continues to engage closely with CMS on this issue.

BCBS-NC Policy on Corticosteroid Injections 

On September 1, 2016, AAOS sent a letter to several officials with the Blue Cross Blue Shield (BCBS) of North Carolina regarding a policy statement that they will not pay for corticosteroid injections for rotator cuff disease (and knee osteoarthritis), stating that it is “experimental.” In the letter, AAOS President Gerald R. Williams, Jr., MD expressed that this is a major issue for orthopaedic surgeons and the organizations representing them, and a number of groups have started gathering evidence against the policy. In response, BCBS-NC noted that they received significant feedback from the local orthopaedic community since this policy was noticed and, “have tabled the policy at this time.” AAOS is pleased with the BCBS decision and will continue to monitor this issue in North Carolina and other states. 


In 2016, the AAOS Medical Director met with CMS Acting Administrator, Andy Slavitt, to discuss CMS’s refusal to implement Section 105(b) of MACRA and directing registries instead to use the Research Data Assistance Center (ResDAC) process which was insufficient and inconsistent. As a result, CMS moved away from the ResDAC proposal and issued a new rule to allow Qualified Clinical Data Registries (QCDRs) to serve as Quasi-Qualified (QE) entities. AAOS supports CMS’s efforts to expand how qualified entities may create non-public analyses and provide or sell such analyses to authorized users, as well as how qualified entities may provide or sell combined data, or provide Medicare claims data alone at no cost, to certain authorized users. The AAOS welcomes the expansion of the Qualified Entity (QE) program but finds it insufficient to meet the needs of registries for access to real time Medicare claims data to conduct validation studies to support patient safety and quality care studies. AAOS is leading the advocacy effect with CMS to compel the agency to implement Section 105(b) which gives QCDRs access to Medicare claims data. AAOS advocacy resulted in a provision in MACRA that will provide a Medicare bonus payment to physicians who submit MIPS data through a QCDR or clinical data registry.

Additional advocacy initiatives resulted in the HHS Office of Human Research Protection (OHRP) posting guidance documents on their website clarifying applicability of the Common Rule to clinical data registries. AAOS advocacy with OHRP resulted in the issuance of a final rule in early February 2017 on the Federal Policy for the Protection of Human Subjects. The final rule provides clarity on the single IRB review mandate, reforms to the Common Rule informed consent requirements among other modifications. The preamble to the Final Rule provides further clarification on the application of the Common Rule to clinical data registries in response to the mandate in MACRA directing OHRP to do so.

AAOS also obtained language in House Energy & Commerce legislation directing the HHS OHRP to post guidance on applicability of the Common Rule to clinical data registries. Furthermore, AAOS supported the establishment of the definition for the term “clinician-led clinical data registry” that was presented in the HELP Health IT Bipartisan Staff Discussion Draft and adopted by Congress. This is the first time the federal government has a definition for a clinician-led clinical data registry, which will ensure uniformity in standards for registries.

Adding UDI to Claim Forms

AAOS continues to work to compel the Centers for Medicare and Medicaid Services (CMS) to add data entry fields to Medicare, Medicaid, and private insurance forms to capture Unique Identifier Numbers (UDI) for medical devices. AAOS advocacy efforts resulted in a letter signed by both CMS Acting Administrator Andrew Slavitt and FDA Commissioner Robert Califf on July 13, 2016 to the ASC X12 Committee, the entity responsible for data fields on insurance claim forms. CMS had previously opposed putting UDIs data fields on Medicare and Medicaid claim forms. As a result of AAOS advocacy, the x12 Committee issued a series of proposed revisions to the Medicare and Medicaid hospital claim form, including the addition of a reporting field for medical device identifiers. AAOS will now submit comments to the proposed revisions and will work with the federal advisory committee that will review and approve these revisions. AAOS continues to advocate for UDI on all insurance claim forms to improve patient safety and quality reporting. 


AAOS secured representation on the AMA Task Force to Reduce Opioid Abuse and continues to develop opioid positions and advocacy efforts to combat the opioid epidemic. In early July 2016, CMS proposed to remove the HCAHPS survey pain management questions from the hospital payment scoring calculation, which comes as a big win for orthopedists. At the AMA House of Delegates Interim Meeting in 2016, the AAOS introduced and successfully passed a resolution titled, Support for Prescription Drug Monitoring Programs (PDMPs). The resolution resolved to continue to encourage Congress to assure that National All Schedules Prescription Electronic Reporting Act (NASPER) and/or similar programs be fully funded to allow state prescription drug monitoring programs (PDMPs) to remain viable and active. The resolution also resolved to work to assure that interstate operability of PDMPs in a manner that allows data to be easily accessed by physicians and does not place an onerous burden on their practices.

Performance Measures

AAOS is very active in the performance measures arena. We have provided input to The Joint Commission (TJC) that addressed Total Hip and Total Knee Replacement (THKR) Performance Measures. In addition, the AAOS has provided feedback to the National Quality Forum (NQF) to improve their new Endorsement and Ratification Process. AAOS submitted comments on the RFI on the Reporting of Quality Measures Under CMS Programs and on Safe Use of Opioids - Concurrent Prescribing Measure Development and Maintenance.