Written by Amanda McGurk · Published November 10, 2026 · Last reviewed November 10, 2026
Under CJR-X, the hospital that bills the anchor stay or procedure owns the 90-day episode. Coding decides the episode type, and so the target price that spending is measured against: MS-DRG 469, 470, 521 or 522 for inpatient cases, or HCPCS 27130 or 27447 outpatient, from January 1, 2028.
| Figure | Number or date | What it means for your hospital |
|---|---|---|
| Model start | January 1, 2028 | Only episodes that start on or after this date count. CMS had proposed October 1, 2027 |
| Hospitals on the CMS list | About 2,217, as of September 30, 2026 | Search the list by CCN. CMS will update it for openings, mergers and closures |
| Episode length | 90 days | Post-acute care and readmissions in that window count toward your spending |
| Inpatient triggers | MS-DRG 469, 470, 521, 522 | Each MS-DRG has its own preliminary target price |
| Outpatient triggers | HCPCS 27130 (THA), 27447 (TKA) | Both are priced inside the MS-DRG 470 target |
| Repayment and payment limits | 20 percent stop-loss and stop-gain; 5 percent stop-loss for MDH, rural, safety-net and SCH | Two-sided risk applies from performance year 1 |
| Low-volume hospitals | Fewer than 31 baseline episodes | Still a participant, but no target price or reconciliation that year |
| CMS five-year estimate | $1.463 billion paid, $1.855 billion repaid, about $736 million net savings | A Medicare estimate across all participants, not a figure for any one hospital |
CMS finalized the model in the FY2027 IPPS final rule, CMS-1849-F, published in the Federal Register on August 4, 2026 (91 FR 49570). Trigger codes, exclusions and risk limits come from 42 CFR part 512, subpart F . The hospital count comes from the CMS CJR-X participant list .
What is the CJR-X model?
The Comprehensive Care for Joint Replacement Expanded (CJR-X) Model is a mandatory Medicare episode-based payment model for lower extremity joint replacement (LEJR) at acute care hospitals. The CMS CJR-X model page calls it the first nationwide test of a mandatory episode-based payment model, and it starts January 1, 2028.
An episode covers Medicare Part A and Part B items and services from the anchor hospitalization or anchor procedure through the 90th day after discharge or the procedure. Hospitals and clinicians keep billing fee-for-service. After each calendar performance year, CMS compares actual episode spending with the hospital's regional, risk-adjusted target price. Depending on spending and quality, the hospital receives a reconciliation payment or repays part of the difference.
CJR-X builds on the original CJR Model, which ran in 34 metropolitan areas and ended December 31, 2024. CMS reports that the original model produced $112.7 million in net Medicare savings across performance years 6 and 7 (2021 to 2023) while maintaining quality of care.
Which hospitals must participate in CJR-X, and which are exempt?
Most acute care hospitals paid under the IPPS must participate. Under 42 CFR 512.605, a participant is an acute care hospital that initiates LEJR episodes and is eligible to be paid under both the IPPS and the OPPS. 42 CFR 512.610(b) then excludes TEAM participants and hospitals located in Maryland.
The CMS model page adds that critical access hospitals and rural emergency hospitals are exempt because they are not paid under both systems. Procedures in ambulatory surgical centers do not start an episode, because the triggers are IPPS and OPPS hospital claims.
The participant list carries hospitals "as of September 30, 2026." We counted 2,217 unique CCNs in it. CMS says it will update the list on a regular cadence, so treat 2,217 as a dated count.
Two protections are often misread as exemptions. Hospitals with fewer than 31 LEJR episodes in the baseline period stay in the model but receive no preliminary target price and are not reconciled that year. Safety-net, rural, MDH and SCH hospitals stay in two-sided risk, with a lower 5 percent stop-loss.
Which MS-DRGs and HCPCS codes start a CJR-X episode?
An IPPS discharge under MS-DRG 469, 470, 521 or 522, or an OPPS claim for HCPCS 27130 or 27447, starts an episode under 42 CFR 512.625.
| Setting | Code | Official CMS title |
|---|---|---|
| Inpatient | MS-DRG 469 | Major Hip and Knee Joint Replacement or Reattachment of Lower Extremity with MCC or Total Ankle Replacement |
| Inpatient | MS-DRG 470 | Major Hip and Knee Joint Replacement or Reattachment of Lower Extremity without MCC |
| Inpatient | MS-DRG 521 | Hip Replacement with Principal Diagnosis of Hip Fracture with MCC |
| Inpatient | MS-DRG 522 | Hip Replacement with Principal Diagnosis of Hip Fracture without MCC |
| Hospital outpatient | HCPCS 27130 | Total Hip Arthroplasty |
| Hospital outpatient | HCPCS 27447 | Total Knee Arthroplasty |
Total ankle replacement enters CJR-X only as an inpatient case through MS-DRG 469. Outpatient total ankle arthroplasty, HCPCS 27702, is not a trigger. The final rule says CMS is testing it in TEAM and would need new rulemaking to add it to CJR-X.
Why does coding matter to a CFO in a CJR-X episode?
Your hospital takes two-sided risk from the first performance year. Commenters asked CMS for an upside-only first year, and CMS declined. Instead it moved the start to January 1, 2028, which gives hospitals a 17-month implementation period. Repayment and reconciliation payments are each capped at 20 percent of the aggregated reconciliation target price amount.
Coding does not change what happens during the 90 days. CMS calls post-acute care partnerships "a crucial driver of episode spending and quality," and the model page names avoidable readmissions as a target. Discharge planning and care coordination move the spending side.
Coding moves the other side of the comparison. Accurate MS-DRG assignment, MCC capture, setting and HCC history decide which target an episode is measured against. They do not by themselves produce a reconciliation payment. A missed MCC can measure a costly case against the lower MS-DRG 470 target. An MCC the record cannot support puts the hospital in the wrong bucket and creates audit exposure, as our guide to upcoding vs. downcoding explains.
How does coding change the target an episode is measured against?
CMS sets a separate preliminary target price for each MS-DRG and folds HCPCS 27130 and 27447 into the MS-DRG 470 target (42 CFR 512.640). These three examples use logic only, with no dollar figures.
Example 1: MS-DRG 469 vs 470. A patient has an elective primary total knee replacement with no hip fracture. If the record documents and clinically supports a secondary condition on the CMS MCC list, the case groups to MS-DRG 469. If that condition appears only as an unsupported mention, the case groups to MS-DRG 470. The surgery is the same, but the episode type and its target differ. Your CDI team settles that difference before the claim drops, not during reconciliation. Our post on clinical validation challenges covers what makes an MCC hold up.
Example 2: MS-DRG 521/522 and the hip fracture. MS-DRGs 521 and 522 require a principal diagnosis of hip fracture. A patient admitted after a fall and treated with hip replacement belongs there when the fracture is the reason for admission. An elective hip replacement in a patient with an old fracture in the history groups to 469 or 470. Sequencing the principal diagnosis is a coding and CDI decision, and it chooses the episode family.
Example 3: outpatient TKA followed by an inpatient stay. A hospital bills HCPCS 27447 as an outpatient procedure on Monday. The patient is admitted to the same hospital on Wednesday for the same episode type. Under 42 CFR 512.630(c), the episode starts on the outpatient procedure date and no separate anchor procedure is initiated. A clean outpatient-only TKA is its own episode, priced inside the MS-DRG 470 target. Setting accuracy changes which episode you are measured on.
Risk adjustment adds a fourth link. CMS uses 29 risk adjusters, including HCC count and 21 specific HCCs from a 180-day lookback that ends the day before the anchor. Diagnoses your coders and clinicians recorded in prior encounters feed that adjustment, so risk adjustment coding quality reaches into the episode too.
How is CJR-X different from TEAM?
| Feature | CJR-X | TEAM |
|---|---|---|
| Episode length | 90 days | 30 days |
| Procedures | LEJR only | LEJR plus other surgical episodes, such as spinal fusion |
| Outpatient total ankle (HCPCS 27702) | Not included | Included |
| Overlap | TEAM participants are excluded from CJR-X | Eligible hospitals move to CJR-X when TEAM ends |
The final rule aligns CJR-X performance years with the calendar year so TEAM participants can begin CJR-X on January 1, 2031. CMS says the two models could produce evidence comparing outcomes by episode length.
What should finance, revenue integrity and HIM do before January 1, 2028?
- Confirm status. Search the CMS list for your CCN and check TEAM status.
- Pull your baseline LEJR volume. Find out whether you sit under the 31-episode threshold and whether the 5 percent stop-loss applies.
- Audit MS-DRG 469/470 and 521/522 assignment on a sample of recent LEJR discharges, focusing on MCC support and hip-fracture sequencing.
- Map outpatient routing for HCPCS 27130 and 27447, and flag outpatient admissions within 3 days of the procedure.
- Keep TEAM's outpatient ankle logic out of CJR-X reporting.
- Tie CDI queries to episode accuracy. Use the approach in our post on how precise AI coding reduces CDI query volume .
- Model post-acute and readmission spend with your care management team. That work, more than coding, moves the spending side of reconciliation.
How does MediCodio AI fit into CJR-X readiness?
MediCodio AI does not manage post-acute care or calculate target prices. It supports the coding layer that decides which episode type each LEJR case lands in.
CODIO AI applies AI medical coding to inpatient and outpatient charts, with 1.5 min to code a chart on its first pass, before review. Complete charts flow through AutoPilot for fully autonomous coding. Charts where the documentation is thin or contradictory stay in CoPilot, where certified coders review and finalize the output. An unsupported MCC or an unclear hip-fracture principal diagnosis is the kind of chart that stays in CoPilot. Each code ships with its documentation passage and the compliance rule behind it, a 100% code-level audit trail your revenue integrity team can open per chart. No coding tool can promise a reconciliation payment. See how this works for hospitals .
What has not changed?
Hospitals and physicians still bill Medicare fee-for-service during the episode. MS-DRG assignment still follows the ICD-10-CM and ICD-10-PCS guidelines. The Hospital Readmissions Reduction Program is a separate program, covered in our post on CMS readmission penalties for FY2027 .
Frequently asked questions
When does the CMS CJR-X model start?
CJR-X is mandatory beginning January 1, 2028. CMS finalized that date in the FY2027 IPPS final rule, CMS-1849-F, after proposing October 1, 2027. Performance years follow the calendar year, and only episodes initiated on or after January 1, 2028 are in the model. Hospitals take two-sided risk from the first year.
How many hospitals must participate in CJR-X?
The CMS participant list dated September 30, 2026 includes about 2,217 acute care hospitals, identified by CCN, that meet the 42 CFR 512.605 definition. CMS will update the list for new hospitals, mergers and closures, so check your CCN against the latest version rather than relying on the count.
Which MS-DRGs and HCPCS codes trigger a CJR-X episode?
An inpatient discharge under MS-DRG 469, 470, 521 or 522 starts an episode, as does an outpatient hospital claim for HCPCS 27130 or 27447. Total ankle replacement counts only as an inpatient MS-DRG 469 case. Outpatient total ankle arthroplasty, HCPCS 27702, does not trigger an episode.
Are TEAM and Maryland hospitals exempt from CJR-X?
Yes. 42 CFR 512.610(b) excludes TEAM participants and hospitals located in Maryland. Critical access hospitals and rural emergency hospitals are also out because they are not paid under both the IPPS and OPPS. TEAM participants that remain eligible would move into CJR-X when TEAM ends, starting January 1, 2031.
How long is a CJR-X episode, and how does it differ from TEAM?
A CJR-X episode ends on the 90th day after the anchor procedure or discharge, counting that date as day 1. TEAM uses a 30-day episode and covers other surgical procedures, such as spinal fusion. CMS says the two models could produce evidence comparing outcomes by episode length.
Book a Demo to run an accuracy review on your own charts, including recent joint replacement discharges and outpatient TKA and THA cases.
Sources
- Federal Register, CMS-1849-F, FY2027 IPPS final rule, 91 FR 49570, August 4, 2026 , including the regulatory impact analysis at 91 FR 50436.
- eCFR, 42 CFR part 512, subpart F .
- CMS, CJR-X model page .
- CMS, CJR-X participant list (xlsx) .