In April 2016, the Centers for Medicare & Medicaid Services (CMS) implemented the Comprehensive Care for Joint Replacement (CJR) model, an alternative payment model involving lower extremity joint (knee and hip) replacement. This program involves acute care hospitals in 67 randomly selected metropolitan statistical areas.¹ Under the CJR model, hospitals will be held accountable for Medicare costs related to lower extremity joint replacement for 90 days after patient hospital discharge. Medicare will continue to reimburse hospitals and post–acute care clinicians and facilities on a fee-for-service basis during the 90-day CJR episode. The model also sets a target payment rate for each hospital based on historical costs and regional averages. Eventually, by the fifth year, the target rate will be based entirely on the regional average. At the end of each year, if total payments during the CJR episode are lower than the target payment rate and a hospital meets all quality thresholds, the hospital would receive the difference between incurred costs and its target payment. Starting in the second year of the program, 2017, hospitals will be required to repay to Medicare any incurred costs beyond the target payment.