Medicare proposes bundled hip, knee payments

Medicare yesterday proposed to bundle reimbursement payments for hip and knee replacement procedures, saying it wants to “hold hospitals accountable for the quality of care they deliver to Medicare fee-for-service beneficiaries.”

The Centers for Medicare & Medicaid Services said its 5-year “Comprehensive Care for Joint Replacement” program would involve more than 800 hospitals in 75 geographic areas, bundling payments for hip and knee replacements from hospital admission to 90 days after discharge. The payment would cover “all related items and services paid under Medicare Part A and Part B for all Medicare fee-for-service beneficiaries,” the government health insurer said.

But reimbursement would also be pegged to outcomes and cost, giving Medicare the ability to claw back payments or reward good performance with addition payments, CMS said. Chief medical officer Dr. Patrick Conway said the program would save about $150 million over 5 years.

If approved, the CCJR program would go into effect in January 2016, affecting about 25% of the 400,000 annual inpatient replacement procedures. CMS said it shells out about $7 billion to cover hospitalizations for those 400,000 surgeries, but noted that average expenditures per procedure vary from $16,500 to $33,000 in different areas.

The agency said it’s accepting public comments on the proposal until Sept. 8.

Here’s a look at the 75 areas that would be covered by the program:

Material from Reuters was used in this report.

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