News archive 2017

Medicare Eases Mandatory Bundled Payment Rules

August 24, 2017

Medicare Eases Mandatory Bundled Payment Rules


The Center for Medicare & Medicaid Services (CMS) is proposing to ease the mandatory requirement that hospitals in 67 regions of the country participate in the current bundled payment model for hip and knee replacements.  The agency is also proposing to completely cancel a planned bundled payment model for cardiac care, cardiac rehabilitation, and hip surgery that would have forced hospitals in 98 regions to participate.   


The agency said the proposed changes would increase flexibility and choice for hospitals providing orthopedic care to Medicare beneficiaries.


Hip and Knee Replacements


Background: In April, 2016, CMS started paying hospitals in 67 regions a single bundled payment for all costs associated with knee and hip replacements. The mandatory five-year program, known as the Comprehensive Care for Joint Replacement model, pays a set fee that covers the costs of the procedure, inpatient stay, and all related care that occurs within 90 days of discharge.


Under the new proposal, CMS would reduce, from 67 to 34, the number of geographic areas in which all hospitals are currently required to participate. The agency would allow hospitals in areas where mandatory participation is no longer required to participate on a voluntary basis.  All low-volume and rural hospitals in all of the geographic areas would be allowed to participate voluntarily. 


Cardiac Care, Cardiac Rehabilitation, Hip Surgery


Background: In July, 2016, CMS proposed a five-year demonstration project that would provide hospitals in 98 metropolitan areas with bundled payments for all the costs of coronary bypass surgery, heart attack care, and hip surgery (hip/femur fractures beyond hip replacement), and of any additional care patients needed within 90 days of discharge.  The program, which also would have created incentive payments for cardiac rehabilitation, was originally scheduled to begin in July, 2017, but was delayed.


Under the new proposal, CMS would cancel the model completely, rather than modifying it and allowing voluntary participation.


Public comments on the proposed rule are due on October 16, 2017.