Medicare bundled payment program cuts spending for joint replacements

Medicare reduced spending for the Comprehensive Care for Joint Replacement program over a two-year period, according to a study published in The New England Journal of Medicine.

CJR is a bundled payment model for hip or knee replacements that is mandatory for hospitals in certain geographic areas. The model rewards or penalizes hospitals based on Medicare spending per joint replacement episode.

The study specifically examined the first two years of bundled payments in the CJR program using Medicare claims from 2015 through 2017. Researchers looked at joint replacement episodes in 75 geographic areas chosen for mandatory participation in the program and compared them with those in 121 control areas, before and after CJR implementation. In total, they examined 280,161 hip or knee replacement procedures in about 800 hospitals in areas chosen for mandatory participation and 377,278 joint replacements in about 960 hospitals in control areas.

The study found that in the first two years of CJR, there was a "modest reduction" in Medicare payments to institutions per joint replacement. After CJR implementation, spending decreases were greater in areas chosen for mandatory participation in the program compared to control areas. Study authors said this was largely due to a 5.9 percent relative decrease in the number of procedures in which patients were discharged to post–acute care facilities.

Access the study results here.

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