On Aug. 1, 2024, the Centers for Medicare & Medicaid Services (CMS) released the 2025 Hospital Inpatient Prospective Payment System Final Rule. CMS has now finalized its proposal to require hospitals located in selected core-based statistical areas (CBSAs) to participate in a new mandatory alternative payment model known as TEAM (Transforming Episode Accountability Model) beginning Jan. 1, 2026. These hospitals will be financially accountable for episodes of care anchored by one of the following procedures:
- coronary artery bypass graft surgery (CABG)
- lower extremity joint replacement (LEJR)
- major bowel procedure
- surgical hip/femur fracture treatment (SHFFT)
- spinal fusion
Each episode will begin with an anchor hospitalization or procedure and will end 30 days after hospital discharge.
CMS’ discussion of TEAM requirements and economic impact, along with the implementing regulations, cover 845 pages of the 2,987-page final rule. There’s a lot to unpack, and PYA will address the details in our September 4 webinar on the final rule.
Most immediately, Table X.A.-07 of the final rule lists the CBSAs selected for mandatory participation in TEAM. These 118 CBSAs–comprising 23.4% of all 803 CBSAs–were randomly selected for TEAM from 18 stratified groups based on average historical episode spending, the number of hospitals, the number of safety net hospitals, and participation in prior CMS bundled payment models.
While some major metropolitan areas are included on the list (e.g., New York, Washington, D.C., Denver, Nashville, Minneapolis), several of the selected CBSAs have only one or two hospitals. (Note that critical access hospitals are excluded from TEAM.)
We encourage you to review the list to see if your community has been selected for participation. With fewer than 17 months until TEAM launches, there’s significant work to be done to align providers, analyze relevant data, and develop and implement protocols. PYA can help. For help understanding the TEAM requirements and for assistance with regulatory requirements, reimbursement, compliance, and strategy, please contact our experts.
