With knee and hip replacements among the most common surgical procedures for Medicare patients—costing more than $7 billion for 400,000+ procedures in 2013 alone—the Centers for Medicare and Medicaid Services wants more accountability from hospitals for better outcomes.

CMS in a new proposed rule wants to launch a five-year program in which all acute care hospitals performing knee and hip replacement surgeries in 75 geographic regions will receive bundled payments for the procedures and submit a long list of data elements so the agency can better monitor readmissions rates and outcomes. The proposed program also covers knee and hip reattachment procedures.

Volunteer patient-submitted data, which will not be publicly reported, would augment administrative claims-based data, and physician reported data and/or electronic health record data. To select the geographic regions, CMS proposes creation of a “stratified random sampling methodology within strata based on the following criteria: historical wage adjusted episode payments and population size,” according to the proposed rule.

Data elements to be captured in pre-operative and post-operative assessments include age, date of birth, gender, ethnicity, procedure, admission/discharge dates, body mass index, level of in-home support, use of chronic narcotics, pain measurements, range of motion, use of gait aids, and various medical indicators such as medical histories, muscle strength, and presence of a gait, among others. CMS will use the data to determine improvement in outcomes for such issues as pain, mobility and quality of life.

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The proposed Medicare payment model is called Comprehensive Care for Joint Replacement, or CCJR, and would last for five performance years. The episode of care during the program will be the time of surgery through 90 days after discharge. Medicare during this period will continue to make usual fee-for-service payments to hospitals and other providers in the selected geographic regions.

“However, after completion of a performance year, the Medicare claims payments for services furnished to the beneficiary during the episode, based on claims data, would be combined to calculate an actual episode payment,” according to the proposed rule. “The actual episode payment is defined as the sum of related Medicare claims payments for items and services furnished to a beneficiary during a CCJR episode. The actual episode payment would then be reconciled against an established CCJR target price, with consideration of additional payment adjustments based on quality performance and post-episode spending. The amount of this calculation, if positive, would be paid to the participant hospital. This payment would be called a reconciliation payment. If negative, we would require repayment from the participant hospital.”

The proposed rule, with a 60-day comment period, is available here.

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