August 3, 2015 INTRODUCTION. Metropolitan Statistical Areas

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1 HIGHLIGHTS FOR THE PROPOSED COMPREHENSIVE CARE FOR JOINT REPLACEMENT PAYMENT MODEL FOR ACUTE CARE HOSPITALS FURNISHING LOWER EXTREMITY JOINT REPLACEMENT SERVICES RULE August 3, 2015 INTRODUCTION On July 9, 2015, the Centers for Medicare and Medicaid Services released the Comprehensive Care for Joint Replacement (CCJR) Payment Model for Acute Care Hospitals Furnishing Lower Extremity Joint Replacement Services proposed rule for fiscal year (FY) The Proposed CCJR Model is focused on elective primary hip and knee replacement patients and would include the inpatient stay and all related care within 90 days of hospital discharge from the joint replacement procedures. The CCJR model would hold participant hospitals financially accountable for the quality and cost of a model episode of care and incentivize increased coordination of care among hospitals, physicians, and post-acute care providers. CMS proposes that the model would begin January 1, 2016 and lasts for 5 years. Under the proposal, all inpatient prospective payment hospitals in 75 metropolitan by CMS must participate in this model. The 60-day public comment period ends on September 8, Metropolitan Statistical Areas The proposed rule outlines the selection methodology utilized by CMS to determine the 75 metropolitan statistical areas (MSAs) that would be subject to the model. Below is a map showing the selected MSAs and a Table listing the MSAs. 1

2 Table 1: Metropolitan Statistical Areas proposed as participants in CCJR model Akron, OH Medford, OR Albuquerque, NM Memphis, TN-MS-AR Asheville, NC Miami-Fort Lauderdale-West Palm Beach, FL Athens-Clarke County, GA Milwaukee-Waukesha-West Allis, WI Austin-Round Rock, TX Modesto, CA Beaumont-Port Arthur, TX Monroe, LA Bismarck, ND Montgomery, AL Boulder, CO Naples-Immokalee-Marco Island, FL Buffalo-Cheektowaga-Niagara Falls, NY Nashville-Davidson--Murfreesboro--Franklin, TN Cape Girardeau, MO-IL New Haven-Milford, CT Carson City, NV New Orleans-Metairie, LA Charlotte-Concord-Gastonia, NC-SC New York-Newark-Jersey City, NY-NJ-PA Cincinnati, OH-KY-IN Norwich-New London, CT Colorado Springs, CO Ogden-Clearfield, UT Columbia, MO Oklahoma City, OK 2

3 Corpus Christi, TX Decatur, IL Denver-Aurora-Lakewood, CO Dothan, AL Durham-Chapel Hill, NC Evansville, IN-KY Flint, MI Florence, SC Fort Collins, CO Gainesville, FL Gainesville, GA Greenville, NC Harrisburg-Carlisle, PA Hot Springs, AR Indianapolis-Carmel-Anderson, IN Kansas City, MO-KS Killeen-Temple, TX Las Vegas-Henderson-Paradise, NV Lincoln, NE Los Angeles-Long Beach-Anaheim, CA Lubbock, TX Madison, WI Medford, OR Orlando-Kissimmee-Sanford, FL Pensacola-Ferry Pass-Brent, FL Pittsburgh, PA Port St. Lucie, FL Portland-Vancouver-Hillsboro, OR-WA Provo-Orem, UT Reading, PA Richmond, VA Rockford, IL Saginaw, MI San Francisco-Oakland-Hayward, CA Seattle-Tacoma-Bellevue, WA Sebastian-Vero Beach, FL South Bend-Mishawaka, IN-MI St. Louis, MO-IL Staunton-Waynesboro, VA Tampa-St. Petersburg-Clearwater, FL Toledo, OH Topeka, KS Tuscaloosa, AL Tyler, TX Virginia Beach-Norfolk-Newport News, VA-NC Wichita, KS Episode of Care and Services CMS proposes to make hospitals financially responsible for the episode of care because an episode always begins with an acute care hospital stay. An episode begins with the admission for an anchor hospitalization and ends 90 days post-discharge from the anchor hospitalization. The episode would be triggered by hospitalizations of Medicare Fee for Service (FFS) beneficiaries discharged with diagnoses: MS-DRG 469: Major joint replacement or reattachment of lower extremity with major complications or comorbidities 3

4 MS-DRG 470: Major joint replacement or reattachment of lower extremity without major complications or comorbidities Following is a list of services included and excluded from the episode: Included Services Physicians services Inpatient hospitalization (including readmissions) Inpatient Psychiatric facility Long-term care hospital (LTCH) Inpatient Rehabilitation Facility (IRF) Skilled Nursing Facility (SNF) Home Health Agency (HHA) Hospital outpatient services Independent Outpatient therapy Clinical Laboratory Durable Medical Equipment Part B Drugs Hospice Excluded Services Acute clinical conditions not arising from existing episode-related chronic clinical conditions or complications of the LEJR surgery Chronic conditions that are generally not affected by the LEJR procedure or postsurgical care Payment and Pricing: Risk Structure CMS proposes to establish target prices for each participant hospital for each performance year and to employ a retrospective two-sided risk model. Under the model, providers and suppliers would continue to be paid via the Medicare fee for service program as usual. After a performance year, actual episode spending would be compared to episode target prices. If aggregate target prices are greater than actual episode spending, they hospital may receive reconciliation payment as long as quality performance thresholds are met. If the aggregate target prices are less than actual episode spending, hospitals would be responsible for making a 4

5 payment back to Medicare. The responsibility for repaying Medicare begins in year 2 (there is no downside responsibility in year 1). The target prices are established for each participant hospital and based on 3 years of historical data. It includes a blend of hospital-specific and regional episode data, transitioning to regional prices as follows: Years 1 &2: 2/3 hospital-specific, 1/3 regional Year 3: 1/3 hospital-specific, 2/3 regional Years 4 & 5: 100 % regional prices Payment an Pricing: Link to CCJR Quality Measures CMS proposes to include 3 quality measures in the CCJR model that hospitals must meet to be eligible for a reconciliation payment: Hospital-level 30-day, all-cause RSRR following elective primary THA and/or TKA (NQF #1551), an administrative claims-based measure Hospital-level RSCR following elective primary THA and/or TKA (NQF #1550), an administrative claims-based measure HCAHPS Survey measure Additionally, CSM proposes to reward hospitals that voluntarily submit data for the following patient- reported outcome measures: PROMIS Global VR (Veterans RAND) 12 HOOS/ KOOS Financial Arrangements: Gain Sharing CMS proposes that participant hospitals may have certain financial relationships with collaborators to support their efforts to improve quality and reduce costs. These collaborators could share in the reconciliation payments and internal cost savings realized through care redesign activities. Collaborators would be required to engage with the hospital in its care redesign strategies and to furnish services during a CCJR episode in order to be eligible for the reconciliation payments. Collaborators may include the following provider and supplier types: 5

6 o Physicians and nonphysician practitioners o Home Health Agencies o Skilled Nursing Facilities o Long Term Care Hospitals o Physician Group Practices o Inpatient Rehabilitation Facilities o Outpatient physical and occupational therapists CMS proposes that the hospital would be required to retain 50% of the downside risk and that the hospital could not share more than 25% of its repayment responsibility with any one provider or supplier. Waivers of Medicare Program Rules CMS proposes to waive certain rules in order to test the CCJR model. Specifically, CMS proposes the following: Waiver of the 3 day inpatient hospital stay requirement for eligibility for a covered SNF stay (ie. SNF 3 day rule) if the SNF is rated 3 stars or higher on Nursing Home Compare. This waiver would not apply during performance year 1 but would apply thereafter. Waiver of the incident to rule for physician services to allow clinical staff of a physician to furnish home visits. (only for non HHA covered patients). CMS proposes to limit the number of home visits to 9 during the episode of care. Waiver of current law limitations on payment for telehealth services that relate to geographic area in which telehealth originating sites may be located. Also, they would allow telehealth services to be furnished in the beneficiary s home or place of residence. These waivers would not permit coverage and payment for telehealth services, such as physical therapy, that are not currently covered and paid for under section 1834(m) of the Social Security Act. The Secretary may also consider whether waivers of certain fraud and abuse laws are necessary to test the CCJR model. Such waivers would be promulgated separately by OIG and CMS. Beneficiary Protections: Access to Care CMS proposes that beneficiaries: 6

7 May still select any provider of choice with no restrictions. May still receive any Medicare covered service with no restrictions. Would not have any changes to copayments. In addition, hospitals may offer certain items and services to beneficiaries during an episode (they may not be inducements.) CMS would monitor for potential risks, such as: Attempts to increase profit by delaying care Attempts to decrease costs by avoiding medically indicated care Attempts to avoid high cost beneficiaries Evidence of compromised quality or outcomes 7