5 Ways To Prepare for CJR

The Center for Medicare and Medicaid Innovation’s new bundled payment model, Comprehensive Care for Joint Replacement (CJR), will begin on April 1, 2016. The model requires mandatory involvement of hospitals in 67 Metropolitan Statistical Areas (MSAs). Beginning in year two of the model (episodes with an acute care admission on October 1, 2016 or after), these hospitals will be at financial risk for the total cost of all Medicare lower extremity joint replacement (LEJR) surgeries. Hospitals need to manage the entire episode of care for these patients from three days prior to hospital admission through 90 days post-discharge.

It’s true that CJR is a complicated model and requires major adjustment within most hospital systems. But where should hospitals begin? Here are 5 things to prepare for CJR.

1.  Assemble a CJR Team

In order to achieve success in bundled payments and CJR, it takes a village. A variety of talents are required to implement a model of this magnitude. Does a participating hospital have people to manage patient cases, implement IT strategies, analyze data, align stakeholders, work with Centers for Medicare and Medicaid Services (CMS), and drive strategic decisions?

Hospitals will need to evaluate their ability to fulfill the roles and responsibilities needed to successfully implement CJR. Which staff members will need to be an integral part of planning, implementing, and managing the model? Evaluate current workloads and decide if internal staff duties can be rearranged, or if more staff will need to be hired. If new staff needs to be hired – don’t put it off. Allow time for proper education on the details and complexities of CJR. Perhaps most importantly, a model like CJR needs someone at the helm. Who will be the CJR leader? 

2.  Establish Provider and Consultant Partnerships

Post-acute providers are an important part of a patient’s care plan and associated charges will be included in the bundle within the 90 day post-discharge period. It is important to identify high quality downstream providers that understand the goals of CJR and that are willing to work with the hospital in the CJR model. Start building those relationships and expectations now.

While post-acute provider partnerships are essential, other partnerships may seem optional (although I would argue they are just as important). If a hospital does not have the internal capacity to implement all aspects of CJR and certain job responsibilities will need to be outsourced, now is the time to evaluate and determine efficient solutions. Hospitals may need to establish contracts for:

  • Data analytics
  • Case management software
  • Strategic consultants to:
    • Establish protocols and manage spending
    • Create engagement and alignment among doctors, case managers, administrators, and clinical team

Now is the time to locate and vet potential partners. How is this done?

3.  Release an RFP

Once a hospital has decided they need some outside help, such as consultants or third-party providers, a request for proposal (RFP) needs to be crafted to find the best collaborator. An RFP needs to be specific, describe exactly what is needed, and written with carefully crafted questions that elicit relevant responses from top performing partner organizations. A hospital will want to find partners who can provide the specific services it needs and who will be an asset to the team.

Once an RFP has been carefully crafted and released, RFP submissions need to be reviewed to find the best partners for CJR success. For any potential partner, hospitals need to make sure the partner brings expertise, the capacity to work with the hospital’s specific needs, and an experienced team to bring the services, insights, or analysis that is required. While there may be new businesses popping up to fill this service gap, CJR hospitals should strongly consider partners with a proven track record of engagement and success in administering necessary services in other CMS bundled payment programs.

4.  Quality Measures – What is the hospital’s current and historical score?

Evidence of quality care is required by CMS and scores on two quality measures impact the amount of reconciliation payments received regardless of whether hospitals are able to stay under its designated target prices. The two quality measures relate to complication rates and patient experience. A third voluntary measure evaluates patient-reported outcomes. The measures are combined into a composite quality score that determines repayment eligibility and the discount rate applied to the target price by Medicare.

In order to be in a position to receive the best possible financial outcome in the CJR model, hospitals need to ensure their quality scores will be top notch and strategies to begin improving upon these measures should be implemented sooner rather than later.

5.  Request Hospital Data

According to the final CJR ruling, hospitals will not receive data unless requested. The mechanism for requesting data from CMS is still being worked out. Once available, hospitals should act quickly to request historical data and be prepared to analyze this massive data set. Analysis of the historical data set is the first step to gain insight into a hospital’s financial risk as well as to begin strategizing and planning how to manage service utilization to eliminate waste while providing quality patient-centered care. The data will serve as the driver to assess acute and post-acute care utilization patterns and provides a foundation for determining historic episode costs.

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Hospitals will need to move rapidly to implement the aforementioned processes in order to assess potential financial risk and opportunities to provide quality care while decreasing cost within this new healthcare payment model.

For more information or assistance in working with bundled payments and value-based care, visit SMGbundles.com.

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