New Program Expands Care for Joint Replacement, Includes Cardiac Care

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Rhonda Oakes By Rhonda Oakes 
Regulatory Analyst, Change Healthcare
Clinician monitoring cardiac health as part of expanded CJR program

As hospitals become increasingly responsible for care delivery outside their walls, opportunities abound for home health.

Although the Medicare Comprehensive Care for Joint Replacement (CJR) payment model began in April 2016, a new Medicare program announced in July would expand CJR and also cover acute myocardial infarction (AMI) and coronary artery bypass grafting (CABG). Like CJR, hospitals would receive a bundled payment that covers in-hospital treatment as well as 90 days of post-acute care in the appropriate setting(s). Payments would be adjusted based on outcomes and quality metrics following a phase-in period.

The 98 geographic areas have not been selected yet for the program, which would begin July 1, 2017. However, the Medicare program is expected to cover one-quarter of the country and will overlap the current CJR program, which covers 67 geographic areas. Home health organizations should be watching these developments carefully since care will need to be delivered and patients monitored for 90 days post-discharge.

Payment Adjustments after Phase-in Period

For orthopedic procedures, the new program covers surgical hip/femur fracture treatment (SHFFT) episodes for MS-DRGs 480-482. The existing CJR model covers MS-DRGs 469-470.

The cardiac procedures covered by the program are triggered by claims for AMI MS-DRGs 280-282 or claims for PCI MS-DRGs 246-251 with an AMI International Classification of Diseases (ICD)-Clinical Modification (CM) diagnosis code in the principal or secondary diagnosis code position. It also covers CABG claims under MS-DRGs 231-236.

During each year of the five-year program, the Centers for Medicare & Medicaid Services (CMS) would set target prices for each DRG based on historical data for hospitalization, procedures and 90 days of post-discharge care. Target prices would be adjusted based on the severity of the condition and the treatment protocol (for example, surgery versus medical management for AMIs).

Target prices would be based on a blend of hospital-specific data and regional historical data:

  • July 1, 2017 – December 31, 2018 (performance years 1 and 2): Two-thirds participant-specific data and one-third regional data.
  • 2019 (performance year 3): One-third participant-specific data and two-thirds regional data.
  • 2020 – 2021 (performance years 4 and 5): Only regional data.

Opportunities for Home Health

Hospitals will be judged on the cost of care, outcomes and patient satisfaction, although quality is the primary driver. A hospital’s quality-adjusted target price would be based on a 1.5%-3% discount relative to historical spending. Lower discounts go to hospitals with the highest quality care, which means they receive a higher total bundled payment.

According to a recent study, home health has demonstrated value for MS-DRG 470 (major joint replacement without major complication or comorbidity). The study, commissioned by the Alliance for Home Health Quality and Innovation for 2011-2014, indicates that patients who received home health care experienced fewer 90-day readmissions than patients who were referred to skilled nursing or in-patient rehabilitation. The study also notes that the cost for home health care was nearly 60% the cost of skilled nursing and half the cost for inpatient rehabilitation.

The severity of the case was likely one reason that patients went to more intensive post-acute care settings, but there were wide geographic differences among referrals that muddies those numbers. In any case, the value of home health was unmatched in the analysis.

And that’s the story you should be telling your care partners and potential care partners. Home health has a critical role to play in the health delivery models for today—and tomorrow.

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