CJR Model Linked to Increased Health Disparities, Study Reveals

June 03, 2021 - In a study of over four million Medicare beneficiaries, researchers found that the Comprehensive Care for Joint Replacement (CJR) model may be widening racial and socioeconomic health disparities in total knee and total hip replacement use.

Published in JAMA Network Open, the study concluded that payment reform under the CJR model could be causing hospitals to avoid joint replacement surgeries for non-Hispanic Black patients due to their perceived higher health risks that could lead to increased spending.

According to CMS, hip and knee replacements are the most common inpatient surgeries for Medicare beneficiaries. The CJR model, which began in 2016, is meant to incentivize coordination of care between hospitals and physicians while holding hospitals accountable for the cost and quality of care for Medicare patients in need of a joint replacement, CMS’ website states.

CMS defines an “episode of care” as the time between hospital admission and 90 days post-discharge. The study states that “hospitals are eligible to earn financial rewards if their spending for each 90-day episode is lower than a quality-adjusted target price, or hospitals are assessed penalties if their spending per episode is higher than this target price.”

“Although the CJR model accounts for the patient’s clinical condition by setting different prices for Medicare Severity Diagnosis Related Groups and fractures, it does not account for sociodemographic risk factors, such as race/ethnicity and income,” the study continued.

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Researchers used Medicare Master Beneficiary Summary File Base Segment enrollment files from 2013 to 2017 to identify Medicare beneficiaries who resided in one of the metropolitan statistical areas (MSAs) where hospitals were required to participate in the CJR model. The beneficiaries had to be between 65 and 99 years old in order to be eligible.

“Outcomes were separate binary indicators for whether a beneficiary underwent THR or TKR,” the study explained. “Key independent variables were MSA treatment status, pre- or post-CJR model implementation phase, combination of race/ethnicity (non-Hispanic White, non-Hispanic Black, and Hispanic beneficiaries) and dual eligibility, and their interactions. Logistic regression models were used to control for patient characteristics, MSA fixed effects, and time trends.”

For non-Hispanic White non-dual-eligible beneficiaries, the CJR model was tied to a 0.10 percentage point increase in total knee replacement (TKR) use. Meanwhile, there was a 0.15 percentage point decrease among non-Hispanic Black non-dual eligible beneficiaries, the study stated. The study found no significant correlation between the CJR model and widening disparities with the use of total hip replacements.

“Results of this study indicate that the CJR model was associated with a modest increase in the already substantial difference in TKR use among non-Hispanic Black vs non-Hispanic White beneficiaries,” the study explained.

“These findings support the widespread concern that payment reform has the potential to exacerbate disparities in access to joint replacement care.”

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The study points to factors like risk of comorbidities, likelihood of postoperative complications, and likelihood of readmissions as potential reasons why some hospitals may avoid joint replacement procedures for certain patients. The risk of higher spending under the CJR model along with the reimbursement incentives if hospitals manage to keep costs low could actually be playing a role in increasing health disparities and decreasing the use of and access to TKRs among non-Hispanic Black beneficiaries.

While results indicate that the CJR model is negatively affecting socially vulnerable patients, research was completed before CMS recently extended the model for three more performance years and made some additional changes. The model will now be in effect through December 2024, rather than its original end date in September 2021.

In the first three years of the model, CMS says that CJR hospitals saved $61.6 million total. The savings are largely attributed to a decrease in post-acute care use. The final rule, released in April 2021, included lower extremity joint replacement procedures in the CJR episode definition, among other changes.

In addition, “CMS changed the basis for the target price from three years of claims data to the most recent one year of claims data, removed the national update factor and twice yearly update to the target prices that accounts for prospective payment system and fee schedule updates, removed anchor factors and weights, and changed the high episode spending cap calculation methodology,” the final rule stated. Additional data analysis in coming years will show the impact of these changes.

The study points out that other programs, such as the Medicare Shared Savings Program, also do not adjust for sociodemographic risk when considering reimbursements. In addition, the CJR model fails to recognize additional burdens of safety-net hospitals. The lack of socioeconomic risk-adjustments is more likely to lead to health disparities, as some hospitals struggle more than others to achieve better health outcomes and lower spending.

“This rationale for unfavorable selection is further supported by concerns that the investments made in quality improvement in preparation for payment reforms and the resulting capabilities may motivate hospitals to increase their case volumes with perceived healthier patients, thereby leaving out beneficiaries from racial/ethnic minority groups and increasing the existing disparities,” the study concluded.