Study: CJR unintentionally penalizes hospitals, does not account for medical complexity

The Comprehensive Care for Joint Replacement program — a bundled payment program implemented by CMS — may inadvertently be penalizing hospitals because it lacks risk adjustment, according to a recent study in Health Affairs.

Researchers determined this by analyzing Medicare claims for lower extremity joint replacement patients from 2011 to 2013. They applied the same payment methodology as CMS uses for bundled payments. The researchers found with each standard deviation increase in a hospital's patient complexity, the net difference in bonus payments dropped $827 per episode of care. They also found adding risk adjustment to the methodology could increase bonus payments to some hospitals by more than $114,000 each year.

"Our findings suggest that CMS should include risk adjustment in the Comprehensive Care for Joint Replacement program and in future bundled payment programs," the authors conclude.


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