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CMS announces new TJA initiative
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The CMS has announced a proposal to hold hospitals accountable for the quality of care they provide Medicare fee-for-service beneficiaries throughout the process of total joint arthroplasty.
“We are committed to changing our health care system to pay for quality over quantity, so that we spend our dollars more wisely and improve care for patients,” HHS secretary, Sylvia M. Burwell, said in a press release. “Today, we are taking another important step to improve the quality of care for the hundreds of thousands of Americans who have hip and knee replacements through Medicare every year.”
In the proposed 5-year payment model, hospitals in 75 locations where the procedure takes place would be held accountable for both quality and cost of care from surgery until 90 days following discharge. Hospitals in these locations may qualify for an additional payment or be forced to reimburse Medicare for a portion of the costs, depending on the institution’s quality and cost performance. Data utilization, spending information and sharing of best practices will be provided to hospitals to aid in improving coordination of care between physicians, home health providers and nursing facilities.
The health care provider themselves would continue to be reimbursed under the current Medicare model, according to the release.
“By focusing on episodes of care, rather than a piecemeal system, hospitals and physicians have an incentive to work together to deliver more effective and efficient care,” Burwell said in the release. “This model will incentivize providing patients with the right care the first time and finding better ways to help them recover successfully. It will reward providers and doctors for helping patients get and stay healthy. And it’s what we hear that many doctors and providers want — to be able to give the best care possible to their patients.”
According to the release, the CMS plans to work with both providers and institutions to assist them in transitioning to this new initiative. Both the public and stakeholders are invited by the CMS to offer input during the 60-day comment period.
The proposal is available at https://www.federalregister.gov/public-inspection. The deadline to submit comments is Sept. 8.
Reference: www.cms.gov.
Perspective
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Jack M. Bert, MD
Clearly, this is simply an expansion and reaffirmation of the original announcement 2 years ago. By 2020, 100% of reimbursements will be based upon value-based care, which basically means thru ACOs and bundled payments for specific episodes of care.
The pioneer program for CMS generated $384 in savings in its first 2 years and, of the percentage Medicare paid in new models, 32.8% was reimbursed using the hospital “value-based” platform. Furthermore, commercial sector scorecards for the past 2 years showed a 30% increase in the portion of value-based payments by private payers, ie, between 2013 and 2014. Thus, even though 58% of payments from Medicare continue to flow thru traditional fee for service models, the reimbursement changes are proceeding rather rapidly, especially with the several thousand Bundled Payments for Care Improvement grants that have been awarded by CMS during the past year. Overall, Medicare spent $6.6 billion for DRG 470, which is total joint replacement (TJR) of the lower extremity. This is their greatest inpatient expense, so Medicare is focused on reducing costs for these procedures and is planning to hold hospitals accountable for the costs of complications of the procedures.
Hospitals will have to find ways to become more efficient, reduce costs and avoid complications for TJR and thus will be forced to partner with the orthopedic surgeons in their community to provide high-quality care at an affordable price.
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