CMS Proposes Nationwide Expansion Of Comprehensive Care For Joint Replacement Model

CMS is looking to bring back the Comprehensive Care for Joint Replacement model, but in a much larger form.

The new version is called Comprehensive Care for Joint Replacement Expanded, or CJR-X. If CMS moves forward with it, most acute care hospitals in the U.S. would have to take part starting October 1, 2027.

The model would apply to many hip and knee replacement cases. In simple terms, CMS wants hospitals to take more responsibility for what happens during the full care period, not only during the surgery.

A Quick Look At The Original CJR Model

CMS first started the CJR model in 2016. It applied to selected hospitals in certain metro areas.

The idea was simple. When a patient had a hip or knee replacement, CMS looked at the full episode of care. That included the hospital stay and the care after discharge, such as rehab, therapy, skilled nursing, home health, and follow-up care.

CMS then compared the hospital’s total spending with a target price.

If the hospital kept costs below the target and met quality rules, it could receive an extra Medicare payment. If spending went above the target, the hospital could owe money back to Medicare.

This did not change how providers were paid during the episode. Doctors, hospitals, and other providers still received normal Medicare payments under systems like IPPS, OPPS, and the Physician Fee Schedule. The comparison happened later, after CMS reviewed the total episode cost.

CMS later found that the original model produced modest savings. It also did not show major harm to care quality. Post-acute spending went down in some cases, while complications, readmissions, and mortality did not increase.

That is one reason CMS now wants to bring the model back and expand it nationwide.

Who Would Be Included?

If finalized, CJR-X would apply to most acute care hospitals in all 50 states, Washington, D.C., and U.S. territories.

The model would include hospitals that perform qualifying lower extremity joint replacement procedures and are paid under both:

• IPPS: Inpatient Prospective Payment System
• OPPS: Outpatient Prospective Payment System

CMS is using this rule because joint replacement cases may start in the hospital or in an outpatient department.

Some hospitals would not be included, such as:

• Hospitals in the TEAM model
• Maryland hospitals
• Indian Health Service and Tribal hospitals
• Critical Access Hospitals
• Rural Emergency Hospitals
• Hospitals in the Rural Community Hospital Demonstration

For hospitals that qualify, participation would be required unless CMS changes the model or the hospital no longer meets the rules.

Which Procedures Would Count?

CJR-X would focus on lower extremity joint replacement procedures. That mainly means hip and knee replacements.

An episode would begin with an anchor event. This could be an inpatient hospital stay or a qualifying outpatient procedure.

The proposed codes include:

• MS-DRG 469: Major hip and knee joint replacement or reattachment with major complications
• MS-DRG 470: Major hip and knee joint replacement or reattachment without major complications
• MS-DRG 521: Hip replacement with hip fracture and major complications
• MS-DRG 522: Hip replacement with hip fracture without major complications
• HCPCS 27447: Total knee arthroplasty
• HCPCS 27130: Total hip arthroplasty

Each episode would last 90 days.

For inpatient cases, the count would begin after discharge. For outpatient cases, it would begin on the procedure date.

CMS says the 90-day window worked in the earlier CJR model and also matches the global surgical period used under the Medicare Physician Fee Schedule.

What Services Would Be Part Of The Episode?

CMS wants the episode to include most Medicare Part A and Part B services tied to the joint replacement.

That may include:

• Physician services
• Inpatient hospital care
• Outpatient hospital care
• Skilled nursing facility care
• Inpatient rehab
• Long-term care hospital services
• Home health
• Outpatient therapy
• Lab services
• Durable medical equipment
• Certain Part B drugs and biologics
• Hospice services

The point is to look at the full cost of care. CMS does not want hospitals to focus only on the surgery and ignore what happens after the patient leaves.

Some services would be left out, especially if they are not related to the joint replacement. CMS may also exclude certain high-cost drugs or technologies that are paid separately.

How CMS Would Judge Quality

CMS would use five quality measures in CJR-X.

These include:

• Complications after hip or knee replacement
• Hospital visits within seven days after outpatient surgery
• HCAHPS patient experience survey
• Outpatient and Ambulatory Surgery CAHPS survey
• Patient-reported outcomes for joint replacement patients

These measures would be combined into one Composite Quality Score, also called CQS.

The score would be weighted like this:

• Complications: 50%
• Patient experience: 40%
• Patient-reported outcomes: 10%

This score would matter for payment. A hospital would not be judged on cost alone.

How Target Prices Would Work

CMS would set target prices before each performance year.

Those prices would be based on three years of regional Medicare claims data. CMS would look at the type of episode and the hospital’s region.

The pricing method would also include risk adjustment, trend updates, a 2% discount factor, and caps for very high-cost cases.

In basic terms, CMS would estimate what a joint replacement episode should cost in that region. Later, it would compare the hospital’s actual spending with that estimate.

How Quality Would Affect Payment

Hospitals would start with a 2% discount factor. That is the saving Medicare expects under the model.

A hospital with better quality scores could reduce that discount. A hospital with weak quality scores could lose access to reconciliation payments.

The proposed categories are:

• Excellent: CQS of 17.1 or higher, discount drops to 0%
• Good: CQS of 12.1 to 17.0, discount drops to 1%
• Acceptable: CQS of 6.1 to 12.0, discount stays at 2%
• Below acceptable: CQS of 6.0 or lower, no reconciliation payment

So, even if a hospital lowers costs, it still needs to protect patient outcomes and experience.

Payments, Repayments, And Risk

After each performance year, CMS would compare actual episode spending with the hospital’s target price.

If spending is below the target and quality is strong enough, the hospital may receive a one-time Medicare payment.

If spending is above the target, the hospital may have to repay Medicare.

For most hospitals, gains and losses would be capped at 20% of the hospital’s total target price.

Rural hospitals and safety-net hospitals would have more protection. Their stop-loss limit would be 5%.

CMS also plans to watch spending during the 30 days after the episode ends. This is meant to prevent providers from pushing needed care outside the 90-day window.

Working With Physicians And Post-Acute Providers

The proposal would allow hospitals to work with physicians and other providers through formal arrangements.

These partners could include surgeons, physician groups, skilled nursing facilities, home health agencies, inpatient rehab facilities, long-term care hospitals, therapy groups, Medicare ACOs, and other providers.

Hospitals may be able to share savings with these partners through gainsharing payments. Some partners may also share downside risk through alignment payments.

CMS would require written agreements and other safeguards. Payments could not be based on referral volume or unrelated business.

Because these arrangements can raise fraud and abuse concerns, CMS says certain waivers or safe harbor protections may apply. Hospitals would still need to structure these agreements carefully.

Why Hospitals Should Pay Attention

This proposal could affect how hospitals manage joint replacement care.

Hospitals may need to look more closely at:

• Post-acute care use
• Rehab and skilled nursing patterns
• Discharge planning
• Readmissions
• Complications
• Patient experience
• Surgeon alignment
• Home health use
• Episode cost tracking

Hospitals that already track these areas may have an easier time adjusting. Hospitals that do not may need to build stronger systems before the model starts.

Final Takeaway

CMS is proposing to bring back the joint replacement payment model and expand it across the country.

If finalized, CJR-X would begin on October 1, 2027. It would make many hospitals responsible for the cost and quality of hip and knee replacement care over a 90-day period.

The model rewards hospitals that manage care well and meet quality expectations. It also creates repayment risk for hospitals with higher spending.

For hospitals, surgeons, and post-acute providers, the message is clear: CMS wants more care coordination, tighter episode management, and better control over the full cost of joint replacement care.