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Hospital_Finance_Podcast smallIn this episode, Maria Miranda, Director of Reimbursement Services at BESLER Consulting reviews how waivers apply to the Medicare Comprehensive Care for Joint Replacement (CJR) bundled payment program.
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Michael Passanante: Hi, this is Mike Passanante. Welcome back to the Hospital Finance Podcast. Today, I’m joined again by Maria Miranda who is the Director of Reimbursement Services here at BESLER Consulting.

Maria joins us today to talk to us about how waivers apply to the Comprehensive Care for Joint Replacement Program. So welcome back, Maria. Thanks for joining us again.

Maria: Thanks, Mike.

Michael: Maria, just to get us started, can you remind our audience what CJR is and why it’s important?

Maria: Sure. So CJR is the new mandatory bundled payment model introduced by CMS that became effective on April 1st of this year for about 800 hospitals in 67 MSAs. The model aims to support better and more efficient care for beneficiaries undergoing the most common inpatient surgeries, which are hip and knee replacements or LEJR, lower extremity joint replacements.

Michael: That’s great. So in previous podcasts, we’ve talked about lots of different topics related to CJR. Today, we’re going to focus in on waivers. So let me throw the first question at you. Maria, what can you tell me about CMS waivers established for the CJR model?

Maria: CMS is introducing a number of program waivers for CJR. They are doing this in order to implement and operationalize the program to make it more efficient and potentially more effective. CMS and HHS, Office of Inspector General would jointly issue waivers of certain fraud and abuse laws for the purposes of testing this model.

Michael: So why are these waivers important?

Maria: The waivers are important because since the participant hospitals will basically be financially responsible for the cost of care under the CJR Program, hospitals will be permitted to enter into certain types of financial gain-sharing arrangements with other downstream providers in the process.

These providers include SNFs, home health agencies, long term care facilities, inpatient rehab facilities, physician practice groups and perhaps suppliers of outpatient therapy and may include sharing of performance-based reconciliation payments and certain types of internal cost savings.

Additionally, hospitals may also assign a portion of the downside risk to their collaborators. However, CMS will deal directly with hospitals with respect to payment and recruitment responsibilities, which in turn will be responsible for any payments to or recoupment from their collaborators.

Michael: So let’s unpack some of the detail around the waivers. Can you explain which waivers are being deployed to help providers that are participating in CJR?

Maria: Sure. CMS is providing certain policy waivers for the beneficiaries that are part of a CJR episode of care. First, the regulations waive the direct supervision requirement as part of the incident to services for home visits to patients during the episode covered by CJR.

Under this waiver, clinical staff would be able to make a home care visit under the general supervision of a physician or non-physician practitioner where the beneficiary would not otherwise meet the requirements for a home health agency visit. For example, if the patient was not homebound, the waiver would allow up to nine visits during the episode and would be billed under the Part B by the physician.

Second, the rules allow for the waiver of three telehealth requirements for services provided during the CJR episode. The first would waive certain geographic site requirements so that the originating site could, for example, be located in an urban area. The second would waive requirements for the originating site in order to allow a telehealth visit to originate in the beneficiary’s home. Finally, the rule allows for the waiver of selected payment provisions related to telehealth services.

Third, the rules provide for the waiver of the requirement of the three-day hospital stay for coverage of SNF services under Medicare following the initial hospitalization of a CJR episode. However, this waiver applies in only year two through five. It doesn’t apply in the first performance year of CJR. And it only applies for SNFs that have been rated at three stars or better under the five-star rating system during certain periods. These facilities will be listed as qualifying facilities on the CMS website.

Waivers do not provide retrospective protection. An arrangement must meet all of the waiver conditions during the period for which the waiver protection is sought.

Michael: Are potential referral and kickback issues being addressed?

Maria: These issues are addressed with fraud and abuse waivers. To address Physician Self-Referral Law and Anti-Kickback Statute Restrictions, CMS and the OIG have issued a joint statement that waives the Federal Anti-Kickback Statute and the Physician Self-Referral Law with respect to certain financial arrangements.

These waivers will protect payments made under the gain-sharing and shared risks agreements that comply with the CJR program requirements. The joint statement also waives the Federal Anti-Kickback Statute and Civil Monetary Penalty Law with respect to certain incentives that participating providers may offer to Medicare beneficiaries during an episode.

These waivers protect financial arrangements, gain-sharing and incentive payments. Let’s look at each of these. First, you have financial arrangements. Providers who furnished direct care to CJR beneficiaries and intend to share in reconciliation payments or repayments are referred to as CJR collaborators and must do so under a written participation agreement with the hospital.

Collaborator arrangements must be outlined for CMS in a CJR sharing arrangement. Similar to those required under BPCI, must stipulate that gain-sharing will not be allowed in the event of any integrity issues on the part of the collaborator. Participant hospitals and their CJR collaborators must agree to the terms of their agreement prior to providing any care under that agreement. All documentation of the agreement terms and any payments or repayments must be retained for 10 years.

Now, let’s discuss gain-sharing. Gain-sharing payments fall into two categories, reconciliation payments and internal cost savings. Gain-sharing is voluntary for the hospital, but if agreed to, the hospital must provide these payments annually. Gain-sharing cannot be predicated on the volume or value of referrals. Gain-sharing payments made to physician or physician group practices are capped at 50% of the total of the Medicare amount approved under the physician fee schedule for services furnished by the physician to the CJR beneficiaries during the calendar year.

And now you have incentive payments. CJR collaborators can share downside risk as well. Payments to hospitals under such an arrangement are called alignment payments and are not allowed if the hospital is not in a repayment situation.

Alignment payments from an individual collaborator cannot exceed 25% of the amount owed by the hospital to CMS. The total amount of alignment payments that a hospital receives from all collaborators cannot exceed 50% of the amount owed by the hospital to CMS. Alignment payments may be collected at anytime.

Michael: And are there any waivers specific to CJR beneficiaries?

Maria: Yes, there are. In order to address beneficiary-induced meant Civil Monetary Penalty Law and Anti-Kickback Statute Restrictions, there are waivers to beneficiary incentives. Under the CJR Program, participant hospitals may provide beneficiary incentives in the form of preventive care items or an item of service that advances a clinical goal for a CJR beneficiary such as post-surgical monitoring equipment for example.

Hospitals must document all of items and services that exceed $25 in value. Items and services involving technology may not exceed $1000 in value. And items exceeding a value of $100 must be retrieved from the beneficiary at the end of the episode.

Michael: Maria, thanks for stopping by and helping us all understand more about waivers related to CJR.

Maria: Okay. Thank you.

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