QUESTION:        I heard that CMS is planning to introduce new episode payment models.  When will these take effect?

ANSWER:            As many of you know, CMS has spent the past several years trying to move away from traditional fee-for-service medicine.  Some of you are likely already participating in the Comprehensive Care for Joint Replacement model, which provides value-based payment for certain types of lower extremity joint replacement procedures.  CMS has recently finalized new policies to implement three new episode payment models (“EPMs”).  The EPMs will apply to Medicare beneficiaries undergoing services related to acute myocardial infarctions (the “AMI model”), coronary artery bypass grafts (the “CABG model”), and surgical hip/femur fracture treatment (the “SHFFT model”).

In the spring of this year, CMS publicized its intent to delay the effective date of these three EPMs.  CMS explained that it agreed with commentators who had asked for more time to prepare for this new payment structure.  CMS also reasoned that the delay would give the agency more time to make modifications, if necessary.  Consequently, the effective date of the AMI model, CABG model, and SHFFT model has been delayed until January 1, 2018.

In addition to these three EPMs, there will also be a cardiac rehabilitation incentive payment model.  This is designed to reduce hospitalizations and preserve medical resources by encouraging affected beneficiaries to take advantage of cardiac rehabilitation.  CMS reasoned that it would be confusing and operationally challenging to implement this cardiac rehabilitation model in 2017.  For ease of implementation, it delayed the cardiac rehabilitation model to January 1, 2018 as well.

Although CMS has expressed a firm intent to proceed with the planned EPMs and cardiac rehabilitation model, it is possible that the agency will make significant further changes before 2018.  We recommend that you build some flexibility into your planning process to account for this uncertainty.