CJR Model
If your SNF has not yet had the pleasure of meeting “the bundle,” as of April 1st, 2016, depending on where you live, your chances just got significantly better! The Comprehensive Care for Joint Replacement (CJR) model, a 5-year program for total hip and knee replacements, or a “type” of Bundled Payment Care Initiative, went into effect April 1st…and this one is…mandatory!
Unlike past participation in Accountable Care Organizations or in the Bundled Payment Care Initiative (BPCI) program, both which are voluntary, Medicare has deemed this CJR bundle mandatory for over 800 facilities in 67 metropolitan areas.The list of hospitals required to participate in the new CJR can be found here or to download a PDF list click here.   {To get caught up on the details of the BPCI bundle, read our recent article.} 
The intent of CMS’ initiative is to improve the quality and efficiency of care for Medicare beneficiaries undergoing elective total hip or knee replacements, definded as a Lower Extremity Joint Replacement (LEJR) episode starting with the inpatient stay and lasting for 90 days through all related post-acute care. The LEJR episode includes all Medicare Part A and Part B services that occur after the hosptial in the IRF, SNF, HHA, and OP settings, as well as any DME, medications or labs, with few exclusions.

The basic idea is that in 67 metropolitan areas, CMS will impose a bundled payment system, comparing what hospitals spend in total on care with what Medicare thinks they should be spending. If the total spending is less than the Medicare target, the hospitals may be eligible to receive additional payment from Medicare {Reward} -but if they spend more than the Medicare target, they could be required to pay back Medicare for some portion of the difference {Repay}.  Yikes!

According to CMS, hip and knee surgeries were chosen because they are the most common inpatient surgery for Medicare patients, and they tend to be high-cost, high-utilization procedures with a wide variance in spending-from $16,500 to $33,000. Forcing coordination of care may level out the spending simply by giving hospitals a financial incentive to work with physicians, home health agencies, skilled nursing facilities, and other providers. Disjointed care can lead to duplication of services, confusion and potential complications, not to mention overspending. CMS wants to help hospitals improve care delivery. Sylvia Burwell, Health and Human Services Secretary said:

“We are embarking on one of the most important steps we will take to improve the quality and value of care for hundreds of thousands of Americans who have hip and knee replacements through Medicare every year. By focusing on episodes of care, rather than a piecemeal system, we provide hospitals and physicians an incentive to work together to deliver the best care possible to patients.”

Highlights from the Rule:

  • Designed as a 5-year test, the CJR model begins April 1, 2016, and ends December 31, 2020. Participating hospitals bear the financial risk {or reward} of the episode of care, which include the procedure, inpatient stay, hospital care, post-acute care, and provider services for 90 days.
  • The CJR model is available to those with Traditional Medicare Part A only – not Managed Medicare.
  • Beneficiaries can pick their provider, though can’t opt out of inclusion if a provider is in the model
  • Patients discharged from the hospital under these DRG’s qulaify:
    • MS-DRG 469: Major joint replacement or reattachment of lower extremity with major complications or comorbidities or
    • MS-DRG 470: Major joint replacement or reattachment of lower extremity without major complications or comorbidities
  • Providers and suppliers will be paid for services under existing systems. {ie: SNF will be paid by RUGS, OP by Fee Schedule} At the end of the model performance year, Medicare will compare a hospital’s total episode spending (including postacute care and provider services) against its “target prices” for that hospital. Reward payments will be issued to the hospital if below “budget” and Repayments to Medicare if over “budget.”
  • In order to receive a “Reward payment” the hospital has to meet set Quality Measure requirements for complication rates, consumer survey results and submission of additional reporting.
    • Hospital-level Risk Standardized Complication Rate Following Elective Primary Total Hip Arthroplasty and /or Total Knee Arthroplasty(NQF #1550)
    • Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) Survey measure (NQF #0166)
    • Additional voluntary reporting
  • Hospitals are permitted to partner with third-party providers and suppliers such as skilled nursing facilities, home health agencies, and outpatient therapy providers AND can share any “rewards” from Medicare, as well as the responsibility to “repay” Medicare for overspending.
  • Hospitals and other providers already participating in CMS’s voluntary Bundled Payments for Care Improvement (BCPI) initiative programs 1, 2, or 4 are not required to participate in the CCJR. Read more.
  • CMS will waive certain rules in order to test the CJR model, specifically:
    • Waiver of the 3 day inpatient hospital stay requirement for eligibility for a covered SNF stay (ie. SNF 3 day rule) ONLY if the SNF is rated 3 stars or higher on Nursing Home Compare (after year 1)
    • Waiver of the “incident to” rule for physician services to allow clinical staff of a physician to furnish home visits for non-HHA covered patients
    • Waiver of current law limitations on payment for telehealth services that will allow telehealth services to be furnished in the beneficiary’s home or place of residence. These waivers will not permit coverage and payment for telehealth services, such as physical therapy, that are not currently covered.

Impact on Therapy Provision in the SNF

Since participant hospitals will be financially accountable for the quality and cost of a CJR episode of care, as will any potential “partners” including SNF’s, therapy may feel the squeeze. The increased coordination of care among providers and the resulting financial relationships with SNF’s to support these efforts to improve quality and reduce costs will shift the care delivery as we now know it {and this was the point!}. Therapy services in the SNF setting are the primary reason for Medicare Part A coverage, and controlling therapy – controls cost. For example, the cost of providing RU level therapy services under the current system provides welcomed reimbursement to the SNF via the current PPS RUG system, though the cost of these services under CJR will be adding up on the hospital’s tab – and may potentially count against the hospital and SNF at some point down the road, depending on financial arrangements made.

Therapists across the country have voiced the desire to see a reimbursement system that was not centered around the total number of therapy minutes provided on the MDS {720 sound familiar?}. Value over volume has been the mantra…and now we may have a new mantra…less is more. Hopefully not a complete 180 degree turn in process! Medicare’s goal is carefully managed and coordinated services to achieve good outcomes. Let’s hope this is true… as therapists should be the only ones controlling the amount of therapy. The last thing therapists want is to transition from a system that rewards more therapy to a system that rewards less therapy. In the new system, less therapy would equal less money spent on care, which would then result in a potential “reward” to the hospital for being “under budget.” This has to be balanced with positive resident outcomes – which typically do not occur magically, thus requiring therapy intervention.

 “This model is about improving patient care. Patients want high quality, coordinated care — not just for a day, but for an entire episode of care. Hospitals, physicians, and other providers who work together can be successful and improve care for patients in this model, and CMS will help providers succeed,” said Patrick Conway, M.D., CMS’ principal deputy administrator and chief medical officer.

Therapists – things to keep in mind for the SNF setting as the CJR process unfolds:

  • Providing therapy to a bundled resident does not guarantee Medicare payment. The therapist is still required to show medical necessity, as well as that the amount provided was reasonable and necessary. In other words, a bundled care resident does not equal automatic Rehab Ultra. The plan of care should justify each resident’s need – and depending on how contracts are set up going forward, the demand for RU may subside
  • The bundle does not waive the need for skilled care. Skilled care is required for coverage – and not all THR/TKR patients may need skilled SNF care
  • Bundled program providers may have protocols for their residents – especially orthopedic physicians – and this is ok. However, these protocols do not guarantee Medicare payment, nor do they trump regulations. For example, an Orthopedic bundle provider may have a protocol for Physical Therapy 7 days per week. However, the intensity of the program (how many minutes per day) will still need to be determined by the evaluating therapist. The 7 days may result in RU or RH, depending on the needs of the resident.
  • If you work for a contract Rehab Company that is paid based on RUG score and not as part of the bundled payment, you may lean toward providing RU level services. However, the physician or SNF that is part of the program may not be so quick to provide an RU level of care – as the cost will add up quick. Things may change!
  • Therapists will have no control as to the type or quality of the admissions into the program – though the expectations for discharge will likely be the same (ie: short length of stay)
  • Though your bundle may have specific documentation requirements, these do not supersede Medicare or your State Practice Act
  • The Medicare Part B Therapy Cap is still in place
  • Remember, this is managed care…and it is still managed profit for the stakeholders. This means there may be a push for things that help the managed care bottom line, including: a shorter length of stay, less equipment, less home care after discharge, etc. A safe discharge continues to be the therapist and teams primary responsibility and nothing should alter your judgement regarding what each resident requires. No short cuts!

 In Summary

The CJR program is another means for Medicare to tie payment to quality of care vs quantity of care. By making the providers, or “players” responsible for managing the total cost of care for each beneficiary, communication between post-acute care settings can be improved, thus improving cost and coordination of care. In essence, the CJR can be described as another type of “managed care” program. Instead of being “managed” by a Managed Medicare entity, the Medicare dollars are managed by the hospitals responsible for the surgery and follow-up care of the resident, the ones holding the “purse.” If  services are not managed properly, “the purse” will empty quickly, leaving little to no profits for the stakeholders. Therapy service trends may change as partnerships are formed with hospitals – especially if the SNF has “skin in the game.”

Reward or Repay…this will be the new way.  As SNF therapists, continue to advocate for the residents to ensure they receive the reasonable and necessary services they require – to meet resident goals, not financial targets. Therapy services should not be trimmed down for the sole purpose of creating more profits- just as therapy services under the current system should not be over-provided for the purpose of creating more profits. If therapists continue to provide what is reasonable and necessary for each individual patient, and support this need in the therapy documentation, Medicare’s CJM model of checks and balances may just work after all!

Any questions? Submit them via our JustAsk! Q&A Forum.

In Your Corner,



More CCJR Resources:

CJR General Information

CJR Info Page

FAQ Page

CJR Fact Sheet

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