A closer look at CMS’ proposed CJR-X model

In the fiscal year (FY) 2027 Inpatient Prospective Payment System (IPPS) proposed rule, CMS outlined its plans to launch a nationwide expansion of its Comprehensive Care for Joint Replacement (CJR) model.

Launched in 2016, the CJR model produced significant Medicare savings while maintaining quality of care. Due to CJR’s success, CMS is proposing to expand this model to improve care for original Medicare beneficiaries undergoing lower extremity joint replacements (LEJR) in both the inpatient and outpatient hospital settings.

The proposed CJR Expanded (CJR-X) model would hold hospitals responsible for all spending and care associated with an LEJR episode, starting with the procedure and ending 90 days post-discharge. For eligible patients, each episode would include all related items and services paid under Parts A and B, including the procedure, hospital stay, physical therapy, and follow-up visits. At the end of each performance year, CMS would compare actual total episode spending to the participating hospital’s target prices.

CJR-X would improve on the previous model by applying a risk adjustment methodology designed to reduce administrative burden while better accounting for patient acuity. This would prevent hospitals from being penalized for complex beneficiaries or those who require complicated care, according to CMS.

While CJR primarily focused on hip and knee procedures, CJR-X would also include ankle replacements. CMS is proposing to include the following procedures in the new model:

• MS-DRG 469: Major hip and knee joint replacement or reattachment of lower extremity with major complications or comorbidities (MCC) or total ankle replacement
• MS-DRG 470: Major hip and knee joint replacement or reattachment of lower extremity without MCC
• MS-DRG 521: Hip replacement with principal diagnosis of hip fracture with MCC
• MS-DRG 522: Hip replacement with principal diagnosis of hip fracture without MCC
• HCPCS 27447: Total knee arthroplasty
• HCPCS 27130: Total hip arthroplasty

CMS is proposing to launch the new model on October 1, 2027. If finalized, CJR-X would represent the first mandatory, nationwide test of an episode-based payment model. Most IPPS hospitals would be required to participate, but certain organizations, including those participating in the Transforming Episode Accountability Model (TEAM) and/or located in Maryland, would be exempt. After TEAM concludes in December 2030, eligible hospitals would be required to participate in CJR-X.

CMS is accepting comments on the CJR-X model and other provisions in the FY 2027 IPPS proposed rule until June 9. Read additional NAHRI coverage on the proposed rule here. For guidance on how to write an effective comment, see NAHRI’s white paper Advocacy in Action: Commenting on Proposed Rules.