Saturday, February 21, 2015

Medicare Launches Performance-Based Cancer Payment Model

CMS is beginning to 'flesh out' new payment models by selecting Cancer and Oncology as a test bed.  The model appears to be similar to a baseline prepaid and capitated model, with an incentive paid for quality outcomes.

A great challenge will be converting from the FFS system to one based on quality of care. Prepaid models emphasize cost saving by providers in order to maintain profitability. 

Oncology Care Model (OCM)

From the CMS Innovation web site:

"The Center for Medicare and Medicaid Innovation (CMS Innovation Center) is developing new payment and delivery models designed to improve the effectiveness and efficiency of specialty care. Among those specialty models is the Oncology Care Model, an innovative new payment model for physician practices administering chemotherapy. Under the Oncology Care Model (OCM), practices will enter into payment arrangements that include financial and performance accountability for episodes of care surrounding chemotherapy administration to cancer patients. The Centers for Medicare and Medicaid Services (CMS) is also seeking the participation of other payers in the model. This model aims to provide higher quality, more highly coordinated oncology care at a lower cost to Medicare.

Cancer diagnoses comprise some of the most common and devastating diseases in the United States: more than 1.6 million people are diagnosed with cancer each year in this country. A majority of those diagnosed are over 65 years old and Medicare beneficiaries. Through OCM, the CMS Innovation Center has the opportunity to achieve three goals in the care of this medically complex population:  better care, smarter spending, and healthier people.

The goal of OCM is to utilize appropriately aligned financial incentives to improve care coordination, appropriateness of care, and access to care for beneficiaries undergoing chemotherapy. OCM encourages participating practices to improve care and lower costs through an episode-based payment model that financially incentivizes high-quality, coordinated care. The CMS Innovation Center expects that these improvements will result in better care, smarter spending, and healthier people. Practitioners in OCM are expected to rely on the most current medical evidence and shared decision-making with beneficiaries to inform their recommendation about whether a beneficiary should receive chemotherapy treatment. OCM provides an incentive to participating physician practices to comprehensively and appropriately address the complex care needs of the beneficiary population receiving chemotherapy treatment, and heighten the focus on furnishing services that specifically improve the patient experience or health outcomes."

Another CMS goal is to provide a model for private insurer payments.

OCM encourages other payers to participate in alignment with Medicare to create broader incentives for care transformation at the physician practice level. Aligned financial incentives that result from engaging multiple payers will leverage the opportunity to transform care for oncology patients across a broader population. Other payers would also benefit from savings, better outcomes for their beneficiaries, and information gathered about care quality. Payers who participate will have the flexibility to design their own payment incentives to support their beneficiaries, while aligning with the Innovation Center’s goals for care improvement and cost reduction.
Medicare Fee For Service (FFS) OCM incorporates a two-part payment system for participating practices, creating incentives to improve the quality of care and furnish enhanced services for beneficiaries who undergo chemotherapy treatment for a cancer diagnosis. The two forms of payment include a monthly per-beneficiary-per-month (PBPM) payment for the duration of the episode and the potential for a performance-based payment for episodes of chemotherapy care. The $160 PBPM enhanced care management payment will assist participating practices in effectively managing and coordinating care for oncology patients during episodes of care, while the potential for performance-based payment will incentivize practices to lower the total cost of care and improve care for beneficiaries during treatment episodes."

Eligibility and How to Apply

"All practices and payers who wish to apply for participation in OCM-FFS must first submit a non-binding letter of intent (LOI). LOIs for interested payers are due by 5:00 pm EDT on March 19, 2015. LOIs for interested practices are due by 5:00 pm EDT on April 23, 2015. LOI forms are available for download (see Additional Information below), and will only be accepted through the Oncology Care Model email inbox at
Practices and payers that submit timely, complete letters of intent (LOIs) will be eligible to submit applications:"

Introductory Webinar

A webinar introducing the core concepts of OCM, including application instructions, will be available to the public from 12:00 – 1:00 pm EST on February 19, 2015. Advance registration is not required. For additional information, please visit the Oncology Model webinar page.

Additional Information

This OCM pilot program may well forecast the proposed model for other disease entities.  Oncology is a 'wastebasket terminology that attempts to describe a wide variety of tumors ranging from malignant melanoma to cancer of the breast.  Thus far it does not seem to address cancer diagnosis, surgical treatment, radiation treatments and/or novel immune therapies.
Much like the Pioneer ACO program this is a test bed or pilot program. Hopefully CMS will evaluate this for several years prior to rollling it out. 
As of October 2014 CMS released a more complete picture of Pioneer ACO Results .
These ACO-level data reflect the range of experiences across Pioneer participants. Some ACOs have sustained positive performance to date, while others have seen diminishing rates of return. Those organizations more committed to clinical transformation, patient outreach, and organizational change may be more likely to do better, but further analysis of differences in performance could enable the Pioneer Program and ACOs to achieve bigger impacts over time.
"It is hard to know what the third performance year of the Pioneer program will show, but as noted earlier, the Pioneer Program has already lost over a third of its original 32 participants. Despite the decline in participation and mixed results so far, CMS remains optimistic and committed to the program, and the overall number of Medicare, Medicaid, and privately-insured individuals in ACO arrangements continues to rise. We can anticipate a proposed rule impacting the MSSP, likely later this Fall, which will impact elements of the Pioneer ACO program. Regulatory changes that may help increase the ability of the Medicare ACO programs to support better care while ensuring sustainability include: adjustments to attribution methods, benchmark calculations, collection and sharing of data with ACOs, updating performance measures, linking to other ongoing payment and delivery reforms, and creating more financial sustainability for program participants. The current Pioneer program can be a key step toward effective payment reform, but further steps are needed to assure long-term success."
(Editorial comment)
It is likely the new model for payment will have mixed success. This approach requires an integrated system and experience in measuring performance. Small groups and practices face many obstacles, and will be disadvantaged. 

ACOs Are the Latest Assault on Private Medical Practice

Richard Amerling, M.D. explains, "In a critique of Accountable Care Organizations (ACOs) last October I wrote: “Now comes news that three more of the original groups will jump ship, leaving only 19 of the original 32 still on board. A nearly 50 percent attrition rate should be seen as a death knell for the concept, as these were likely the best of the best, and the inducements most generous. Reasonable people would head back to the drawing board. But we are dealing with government bureaucrats, health policy wonks, and administrators. They will damn the torpedoes and push on at flank speed.”

Amid fanfare, the Secretary of HHS Sylvia Mathews Burwell recently announced plans to move 50 percent of Medicare spending into ACOs and other forms of “payment for value.” This initiative is being pushed through by special interests that expect to benefit. Patients and practicing physicians, the people most affected, are simply not represented. The HHS plan “aligns with the [AMA’s] commitment to work toward innovative care delivery reform that will promote high-quality and efficient care for our nation’s seniors who count on Medicare, while reducing the administrative and regulatory burdens physicians face today.”

And so the leaders of “organized medicine” (AMA) are on board with policies that will lead to the destruction of private medical practice, which depends completely on the much-maligned fee-for-service payment mechanism. Perhaps they don’t fully comprehend the implications of what they are endorsing. The fee-for-service private medical system has been the bedrock of American medical care. Far from driving up costs, private medicine is the one part of the system holding down costs. The never-ending regulations and hurdles from third-party payers, both private and governmental, impose costs in a private medical office. A direct pay (non-third-party) medical practice is a model of efficiency. A patient visits the doctor and pays directly for the visit at the point of service. No bill to an insurance company is generated (though the patient may choose to submit a claim). Personnel dedicated to billing, obtaining various prior authorizations, and following up on denied claims, are eliminated.

Richard Amerling, MD (New York City) is an Associate Professor of Clinical Medicine and an academic nephrologist at Mount Sinai Beth Israel in New York. Dr. Amerling received an MD from the Catholic University of Louvain in 1981. He completed a medical residency at the New York Hospital Queens and a nephrology fellowship at the Hospital of the University of Pennsylvania. He has written and lectured extensively on health care issues and is President of the Association of American Physicians and Surgeons. Dr. Amerling is the author of the Physicians' Declaration of Independenceand is a seasoned speaker and on-air contributor.


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