The proposed CJR-X (Comprehensive Care for Joint Replacement Expanded) Model would build on the CJR Model, which CMS said produced strong evidence of cost savings while maintaining quality of care. The mandatory model is expected to begin in October 2027. In an e-mail interview with Healthcare Innovation, Manatt Health Senior Advisor William Gordon, M.D., discussed what hospitals and ACOs will need to do to prepare for the new model. 

HCI: Could this be the start of a new era in how CMS pays for episodes of care?


Gordon: CJR-X is a logical extension of CMMI’s episode-based models. I would describe CJR-X as a continuation of a trajectory that has been building for more than a decade. What makes CJR-X unique is that it is mandatory and nationwide; TEAM is mandatory but is limited to specific regions (similar to CJR), and prior episode-based payment models like BPCI and BPCI-A were voluntary. I think CJR-X signals that CMS/CMMI view episode-based payment models as a permanent pillar of a specialty strategy.

HCI: Are there some other procedures they might apply this type of payment model to?

Gordon: Joint replacement is a logical place for CMS to expand episode-based payment because the original CJR model generated savings while maintaining quality. If CMS ultimately looks to broaden CJR-X beyond joint replacement procedures, TEAM may offer the most obvious starting point because it is already testing several additional surgical episodes,  including surgical hip/femur fracture treatment, spinal fusion, CABG, and major bowel procedures, under a mandatory model. Whether CMS would expand any of those episodes nationally would likely depend on the performance data that TEAM generates.

HCI: Has CMS built some changes into CJR-X from the original CJR program based on stakeholder feedback?

Gordon: Yes. Perhaps the most notable is the risk adjustment methodology. CJR-X uses far more risk adjustment variables than CJR, which is meant to address a criticism that CJR did not adequately account for beneficiary complexity in its risk adjustment methodology. CJR-X also expands on the CJR quality methodology by adding several measures as compared to CJR.

HCI: What is CMS asking hospitals to do in terms of care coordination to reduce costs in a model like this?

Gordon: CJR-X is structured around financial accountability for the relevant procedures, as opposed to highly prescriptive care requirements. However, there are several waivers and flexibilities in CJR-X that are designed to enable better care coordination. For example, a Skilled Nursing Facility 3-day rule waiver has been carried over, as has a telehealth waiver (removing geographic and originating-site restrictions), as well as a home visit waiver.

HCI: Do the hospitals have to get better at post-acute care network management?

Gordon: We know from prior surgical episode models that much of the cost savings opportunity comes from post-acute utilization. For CJR-X, I similarly expect performance to depend heavily on post-acute network management and utilization.

HCI: Will they need better data and analytics to have more visibility into performance and flag high-cost cases early enough to act?

Gordon: Performance in episode-based payment models is often heavily connected to data-driven decision making and analytics. There are several components of this for a hospital to consider. First is around price comprehension… target prices are derived from a combination of baseline/historical data and many risk adjusters; understanding what is driving a target price is essential because that is what you will be measured against. Second, in-episode monitoring is key. Hospitals will need infrastructure to identify high-risk patients, track clinical events so that they can intervene, and identify opportunities to streamline care delivery during the episode. 
Finally, because quality measurement is so essential to CJR-X, understanding the relevant quality measures, how they are scored, and how you can improve them will be a differentiator. Data and analytics will be an important part of this.

HCI: What are some things health systems, ACOs, and care teams need to do to start preparing for CJR-X?

Gordon: There are several considerations for a health systems and ACO/provider partners working with them. First is considering strong governance—for example, is there a central clinical or operational owner of CJR-X participation and performance? Second, looking at historical data to understand performance in the CJR-X procedures can identify opportunities for improvement before the proposed model starts. Third, working on post-acute network development can start now, which will give buffer to ensure relationships are in place prior to the start of the model. And finally, starting to build the care management infrastructure now—hiring and investing in these resources and capabilities—will ensure they are available when the model starts.

HCI: Are there different implications for rural hospitals? 

Gordon: Yes. Some hospitals will be excluded from CJR-X based on the model’s participation criteria (for example, facilities that are not paid under both the IPPS and OPPS [Outpatient Prospective Payment System], such as critical access hospitals). Additionally, hospitals with fewer than 31 joint replacement episodes in the baseline period would be excluded from reconciliation for that year, addressing very low-volume facilities. CMS also proposes additional protections for certain hospitals, including a lower stop-loss cap for rural hospitals and other safety-net providers.

HCI: What kind of impact could it have on post-acute care providers and home healthcare providers? 

Gordon: The impact will vary by setting. Similar to CJR, I expect a shift away from skilled nursing facility utilization towards home-based rehab and care; if these patterns continue at national scale, then post-acute facilities will likely see a reduction in joint-replacement admissions, and home health agencies would see an increase in demand.

HCI: Anything else you want to add? 

Gordon: CJR-X is proposed – not final yet. There will likely be some modifications as the proposed rule goes through public comment and response, so it will be interesting to compare the proposed rule to final rule when it is published later this summer.