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Hospitals across the country will soon face a new level of accountability for joint replacement care. As part of the FY 2027 IPPS Final Rule, CMS finalized the Comprehensive Care for Joint Replacement Expanded (CJR-X) Model, marking the first mandatory nationwide episode-based payment model in Medicare. The program will begin January 1, 2028, a three-month delay from the originally proposed October 1, 2027, start date. [2], [hfma.org]
CJR-X builds on the success of the original Comprehensive Care for Joint Replacement (CJR) Model and is designed to improve care coordination for Medicare beneficiaries undergoing lower extremity joint replacement procedures. The model includes hip, knee, and ankle replacements performed in hospital settings. [2]
Under CJR-X, participating hospitals will be held financially accountable for the entire episode of care, including:
The goal is to encourage hospitals, surgeons, and post-acute providers to work together to deliver high-quality, coordinated care while reducing avoidable complications, readmissions, and unnecessary spending. [2]
CMS is expanding the model based on the results of the original CJR program, which operated from April 2016 through December 2024. According to CMS, the program generated more than $100 million in Medicare savings while maintaining quality of care, demonstrating that coordinated, episode-based payment models can improve efficiency without compromising patient outcomes. [2], [1]
CMS leaders have emphasized that CJR-X aligns financial incentives with patient outcomes, rewarding hospitals that successfully coordinate care throughout the recovery period rather than focusing solely on the surgical encounter. [cms.gov], [cms.gov]
Most hospitals paid under the Inpatient Prospective Payment System (IPPS) and the Outpatient Prospective Payment System (OPPS) will be required to participate. However, CMS finalized several exemptions including:
These exemptions are intended to avoid overlapping payment models and account for unique state payment structures. [hfma.org], [1]
What This Means for Hospitals
With CJR-X, hospitals will need to strengthen partnerships across the continuum of care, including physicians, rehabilitation providers, skilled nursing facilities, and home health agencies. Organizations that can effectively manage recovery, reduce complications, and prevent avoidable utilization will be better positioned to succeed financially under the model. [2]
For clinical and quality leaders, the model reinforces the ongoing industry shift from fee-for-service reimbursement toward value-based care, where success is measured not only by the procedure itself but by the patient’s overall recovery experience and outcomes. [2]
Beginning in 2028, CJR-X will make episode-based payment for joint replacements a nationwide reality. By holding hospitals accountable for care from surgery through 90 days of recovery, CMS aims to improve coordination, enhance patient outcomes, and reduce unnecessary Medicare spending. The model’s nationwide expansion signals CMS’s continued commitment to value-based care and may serve as a blueprint for future episode-based payment initiatives. [2]
