Action Alert

Medicare Delays Hip and Femur Fracture Payment Model

CMS has delayed the expansion of the Comprehensive Care for Joint Replacement (CJR) bundled payment program which would have included surgical hip and femur fracture treatment (SHFFT) episodes in its bundled payment initiatives.  As you know from 2016 PTPN updates, in the original CJR bundled payment program, rolled out in April of last year, Medicare pays providers in selected areas a single amount to cover all the costs associated with a total hip or knee replacement (THA/TKA) over a 90-day period.  The program was slated to expand in July to include SHFFT, but is now pushed back to include SHFFT on Oct. 1, 2017.  Also delayed, for a second time, is the effective date of a final rule laying out the implementation of CJR and other bundled payment programs, to May 20, 2017.   The agency is also considering pushing back implementation of bundled payment initiatives even further, until 2018.

It is unclear how the Trump administration will be supporting or developing new initiatives to usher health care out of fee-for-service operations and into payment for value and quality.  Such efforts were a hallmark of health care reform under the Obama administration, which set the goal of having half of traditional Medicare dollars go through alternative payment models by 2018, and still are in many managed care settings.

While in Congress, the new Secretary of HHS, Dr. Tom Price, was a vocal critic of bundled payment initiatives and introduced legislation to delay their implementation.  He appears to be using his position as Secretary to pursue a similar agenda.  The interim rule published on 3/20/17 stated, "This additional 3-month delay is necessary to allow time for additional review, to ensure that the agency has adequate time to undertake notice and comment rulemaking to modify the policy if modifications are warranted, and to ensure that in such a case participants have a clear understanding of the governing rules and are not required to take needless compliance steps."  The interim rule also added that the delay would give participants more time to prepare for these models and that it would be preferable for payment periods to align with the calendar year. 
 
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