With an aim to provide better quality treatment at more predictable costs to about 55 million people, Medicare launched major payment shift for hip and knee surgery. Starting in year two of the program, hospitals can be penalized for a portion of their spending above a set target (CMS fact sheet, 11/16). Under the rule providers will receive one flat fee for the procedures instead of multiple payments for each individual service they provide related to the replacements.
Advertisement
Medicare had initially proposed the changes this summer. Comments (CMS-5516-P) were due September 8 (175 HCDR, 9/10/15).
The model also reflects best practices from the private sector, where major employers and leading providers and care systems are moving towards bundled payments for orthopedic services, CMS said. The model will conclude December 31, 2020. This payment approach should transform care, encouraging hospitals and physicians to work together to coordinate care on a case-by-case basis.
CMS claims the CJR model will further the goal of paying for value rather than volume because it will promote the alignment of financial and other incentive for all health care providers caring for a beneficiary during an LEJR episode.
This model is being tested in 67 geographic areas throughout the country, and almost all hospitals in those geographic areas are required to participate. Hospitals in 67 metropolitan areas including Akron, Ohio, Wichita and Kansas will be responsible for the results of hip and knee replacements from April 1. Hospitalizations from hip and knee replacements reached $7 billion in 2014, according to the agency.
For instance, the rate of complications, like infections or implant failures, after surgery can be more than three times higher for procedures performed at a few hospitals than at others, according to the statement. The average total Medicare expenditure for surgery, hospitalization, and recovery ranges from $16,500 to $33,000 across geographic areas.
Hospitals that meet certain benchmarks for quality and cost measures will receive a bonus payment. The payment structure incentivizes better coordinated care so hospitals work with physicians, home health agencies, skilled nursing facilities, and other providers to ensure beneficiaries receive the care they need and avoidable hospitalizations and complications can are reduced. The final rule is scheduled for publication in the Federal Register on November 24, 2015. The notice will be published on the CMS and OIG websites.
Advertisement
“Additionally, we appreciate that CMS made changes to the quality measurement provisions to allow more flexibility, while encouraging high-quality patient care”.
