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Bundled payment refers to a model for care whereby payment spans an episode of care for specific medical conditions. This model is designed to transition health care from fee-for-service to value-based care in order to improve quality and manage costs. HOI’s Bundled Payment Program aligns physicians, therapists and other professional services to provide patients with the best outcomes possible. HOI has established, refined and utilized this payment model since opening in 2010, and has shown continued success in its bundled program. HOI has cared for nearly 4,000 patients under a bundled payment structure.
Medicare’s CJR
HOI’s mandatory participation in Medicare’s Comprehensive Care for Joint Replacement (CJR) began in 2016 when the program was implemented by CMS. It is a retrospectively bundled, two-sided risk sharing care delivery payment model, with the hospital bearing the financial responsibility. The bundled window includes hospitalization and the 90-day post-hospital discharge time period for complications and payment analysis.
Since the CJR program started, HOI has achieved:
• A consistent composite quality score of “excellent”
• The second largest CJR patient enrollment volume in the nation in program years 1 and 2 and largest volume on the West Coast
• One of the highest reconciliation amounts distributed for value-based care delivery by the CJR program
• A readmission rate of less than 1%.
Along with CJR, HOI has participated in Medicare’s Bundled Payment for Care Improvement Advanced (BPCIA) for orthopedic procedures. HOI has
also partnered with commercial bundled payment preferred provider organization (PPO) programs
for Aetna, Blue Shield, Cigna and Optum, and has bundled programs with Bridge Health, Carrum Health, Surgical Direct and Horizon Medical.
HOI Bundle Volume
61 66 2012 2013 2014 2015
Source: HOI internal data
1,378 1,342 674
2016 2017 2018
 Fee-for-Service vs Bundled Payment
Payer Payer
               HOI Comprehensive Care for Joint Replacement Program Annual Volume
CJR Year 1 Apr 2016 to Sept 2016
CJR Year 2 Oct 2016 to Sept 2017
CJR Year 3 Oct 2017 to Sept 2018
A slight decrease in 2018 volume was due to some Medicare total knee arthroplasty procedures transitioning to outpatient classification.
Source: HOI internal data

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