Home Health & Hospice Week

Take note: Hospice services are included.

Get to know the new hospital payment model that may drastically change your referrals in coming years. In the Nov. 24, 2016 Federal Register, the Centers for Medicare & Medicaid Services published the final rule for the Comprehensive Care for Joint Replacement (CJR) model. The rule contains these elements:

• In response to provider protest, CMS pushed back the start date from Jan. 1 to April 1 for the fiveyear model’s first year. However, CMS kept the rest of the years running from Jan. 1 to Dec. 31, so the first year’s time period is shortened to nine months.
• The model will take place at about 800 hospitals in 67 MSAs in 33 states (down from 75 MSAs in the proposed rule). Hospitals participating in the Bundled Payments for Care Improvement models involving post-acute providers are exempt.
• “The CJR model holds participant hospitals financially accountable for the quality and cost of a CJR episode of care and incentivizes increased coordination of care among hospitals, physicians, and postacute care providers,” CMS explains on its CJR website. The episode begins with a CJR hospital admission and ends 90 days post-discharge. The beneficiary must be discharged under MS-DRG 469 (Major joint replacement or reattachment of lower extremity with major complications or comorbidities) or 470 (...without major complications or comorbidities). The episode includes all related items and services paid under Medicare Part A and Part B for all Medicare fee-for-service beneficiaries.
• CJR includes some limited exclusions for the cost calculation, but hospice services are not one of them (see story, p. 61).
• Each year of the model, CJR hospitals will receive separate episode target prices for MS-DRGs 469 and 470. All providers and suppliers are paid under Medicare’s usual payment system rules and procedures. At the end of a model year, CMS compares actual spending for the episode to the target episode price for the responsible hospital. “Depending on the participant hospital’s quality and episode spending performance, the hospital may receive an additional payment from Medicare or be required to repay Medicare for a portion of the episode spending,” CMS explains on its CJR website.
• In addition to costs, CMS will use a “composite quality score” to determine rewards or penalties under the model.
• Also in response to provider comments, CMS made the risk pool more gradual under the model. CMS finalized no repayments in year 1, a “stop-loss” limit of 5 percent in year 2, 10 percent in year 3, and 20 percent in years 4 and 5. Rural hospitals, Medicare-dependent hospitals, rural referral centers, and sole community hospitals will have stop-loss limits of 3 percent in year 2 and 5 percent in years 3 through 5, the agency notes in a Frequently Asked Questions document on its CJR website. “Stop-gain” limits are slightly more generous: “All hospital participants will be eligible to earn up to 5 percent of their target price in performance years 1 and 2, 10 percent in performance year 3, and 20 percent in performance years 4 and 5,” CMS says.
• “In the CJR model, beneficiaries retain their freedom of choice to choose services and providers,” CMS notes on its CJR page.
• Hospitals can enter into written “CJR sharing” arrangements with “CJR collaborators” to share penalties and rewards.

Note: See the FAQs at https://innovation.cms.gov/Files/x/cjr-faq.pdf.