CMS considers extending hip and knee replacement payment model for another 3 years

Stethoscope on top of five, ten, and twenty dollar bills.
The Centers for Medicare & Medicaid Services has proposed to renew a hip and knee joint replacement bundled payment model for another three years but with some key changes. (Getty Images/PLG)

The Trump administration wants to keep a hip and knee replacement bundled payment model going for another three years.

The Centers for Medicare & Medicaid Services (CMS) released a proposed rule Thursday that calls for a three-year extension to the Comprehensive Care for Joint Replacement Model, which is set to end after this year. The agency is also floating a major change to cover outpatient replacements, as the model currently only covers inpatient procedures.

The goal is to address changes to facilities that can now “allow for total knee and hip replacements to be treated in the outpatient setting,” CMS said in a fact sheet on Thursday.

RELATED: CMS puts an end to mandatory cardiac, hip fracture bundled payment models

CMS is also proposing changes for how it will reconcile payments made under the model. Participating hospitals can get a bundled payment to cover an entire episode of care for a hip or knee replacement.

The episode begins when the patient is admitted and encompasses all care provided for 90 days following patient discharge. The goal of the model, which was created in 2016, was to improve care coordination between the initial admission and through recovery.

Currently, a hospital gets two chances to reconcile its bundled payments: at two and 14 months after the close of a performance year. But CMS is proposing to have one reconciliation period instead at six months after the close of each performance year.

RELATED: HHS plans new bundled payment models with mandatory participation on the table

The agency also wants to update how payments are calculated to better account for changes in Medicare’s payments.

The first two years of the model generated a modest reduction in spending per hip and knee replacement episode, according to a study in the New England Journal of Medicine.

CMS' decision to propose an extension for the joint replacement model comes as other models await word of their fate. Chief among them is the Next Generation Accountable Care Organization program, which also sunsets after this year. 

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