The Centers for Medicare and Medicaid Services (CMS) recently released the fiscal year (FY) 2027 hospital inpatient prospective payment system (IPPS) proposed rule. Included in this rule is a proposal for the expansion of CMS’s Comprehensive Care for Joint Replacement (CCJR) model nationwide to improve care coordination and reduce costs for Medicare patients undergoing hip, knee, and ankle replacements. The model would hold hospitals accountable for the full episode of care, including surgery and 90 days of recovery, encouraging better outcomes and a more efficient use of resources.
For background purposes, from April 2016 through December 2024, the CMS Innovation Center tested the CJR Model to improve care for Medicare patients undergoing joint replacement procedures. During that time, the model generated significant Medicare savings while maintaining quality of care for beneficiaries. Under the CJR Model, hospitals were held responsible for Medicare spending for the joint replacement surgery, the hospital stay, and the first 90 days of recovery, including follow-up care such as physical therapy.
Based on the evaluation of the CJR Model, the CJR Expanded (CJR-X) Model would create strong incentives for hospitals to coordinate care more effectively, avoid unnecessary services like avoidable re-hospitalization and emergency care, and focus on delivering the best outcomes for patients. It would specifically encourage better communication with post-acute care providers to support recovery. Beginning October 1, 2027, CJR-X would be required for most hospitals, making it the first mandatory, nationwide test of an episode-based payment model.
Comments on the proposed rule are due by June 9, 2026.
