Friday marks the start of the five-year Oncology Care Model, one of the first CMS physician-led specialty care models aimed at improving quality and reducing the cost of care.
Here are nine things to know about the OCM.
1. HHS selected 17 payers and 196 physician practices to participate — almost twice the number it expected. To participate, physician practices must provide chemotherapy and meet several parameters regarding EHRs, patient access and care coordination, among other requirements. In addition to Medicare fee-for-service, the model includes state Medicaid agencies and commercial payers that are able to design their own payment incentives if they align with the Innovation Center's goals. Here is a list of the participating practices.
2. The program takes an episodic approach to cancer treatment to help contain costs and enhance patient care. Cancer is one of the nation's most common and deadliest diseases — and is estimated to cost at least $158 billion annually by 2020, according to the NIH. Of the more than 1.6 million Americans diagnosed with cancer annually, about half are Medicare beneficiaries. By paying physicians based on financial and quality performance for an episode of care, CMS hopes to spur continuous quality and cost improvement while achieving better health outcomes for Medicare beneficiaries.
3. Under the OCM, physicians are paid in two ways. The first is a monthly captitation payment, called a Monthly Enhanced Oncology Services payment. Participating practices will receive $160 per Medicare fee-for-service beneficiary per month. This is intended to cover the costs of managing and coordinating care. The second payment is a performance-based incentive, based on the OCM episodes of care.
4. Episodes last six months each and cover almost all cancer types. The episode starts when the patient starts chemotherapy. It will include all Medicare Part A and B services, as well as some Part D expenditures. If beneficiaries need more chemotherapy after the end of the six-month period, they begin a new episode. If they enter hospice care, the payments are discontinued.
5. Performance payments are awarded to practices based on how well they perform in relation to benchmarks calculated by CMS. These benchmarks are based on historical data and are adjusted for geographic variation and trended to the performance period. CMS then applies a discount to this benchmark to determine a target price for each episode. If provider expenditures are below the target price for the episodes of care, they have the opportunity to share in the savings, or receive a bonus. The size of this bonus is subject to change based on how well the practices perform on quality measures.
6. There are two risk options under the OCM. Under the one-sided track, participants are not responsible for any expenditures that exceed the target price set by CMS. The discount in the one-sided track — which is used to calculate the target price — is 4 percent. While physician practices can participate in this track for the duration of the five-year program, they must qualify for performance-based payments by the end of the third year. Under the two-sided track, participants have the option to take on downside risk in the third year. After this point, they are financially at risk if they spend over the target price for the episodes of care. However, the discount in the two-sided risk track is 2.75 percent, giving practices a little more leeway under this model.
7. The two-sided risk track is considered an Advanced Alternative Payment Model under the newly proposed Medicare Access and CHIP Reauthorization Act. Though CMS has not yet released a final rule for MACRA, under the proposed rule those practices that are considered advanced APMs will be eligible to receive a lump-sum bonus.
8. CMS will provide a learning system for participants to share and diffuse resources, tools, ideas and data-driven approaches to care. This system will include webinars, an online portal to share resources, action groups, site visits and coaching.
9. Dual participation in OCM and other programs is allowed in some cases. Practices can participate in shared savings programs like accountable care organizations or the Comprehensive Primary Care model, however, dual participation in OCM and the Transforming Clinical Practice Initiative is not allowed.
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