CJR bundles to pay $25k per episode: 8 statistics on cost breakdown

Practice Management

An Avalere analysis shows more than half of hospitals currently scheduled to participate in Medicare's Comprehensive Care for Joint replacement model could face penalties based on their cost performance if implemented as scheduled on April 1.

There are 800 hospitals that will be at risk for all Medicare spending for hip and knee replacements throughout the 90 day episode of care. Medicare will compare hospital spending with regional and historical spending levels; around 60 percent of participating hospitals cost more than episodes for their regional peers.


"Most past CMS initiatives have stimulated activity among early adopters, but the mandatory programs are CMS's attempt to bring the remaining hospitals into a value-based payment world," said Senior Vice President at Avalere Health Josh Seidman. "For many of those providers sitting on the sidelines of alternate payment models, the new initiative will be a wake-up call."


The average cost per CJR episode breakdown by care setting includes:


• Inpatient hospital stay: $13,193
• Skilled nursing facility: $5,034
• Inpatient rehabilitation facility: $1,568
• Home health agency: $2,123
• Physician: $1,675
• Hospital readmissions: $1,155
• Outpatient: $604
• Durable medical equipment: $122


The total Medicare payment per episode will be $25,565 with 39 percent tied to post-discharge care.


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