Payment Reform Efforts to Support Cancer Care Coordination, Treatment Planning

The American Society of Clinical Oncology (ASCO) is proposing to profoundly reform payment for cancer care. ASCO’s Patient-Centered Oncology Payment: Payment Reform to Support Higher Quality, More Affordable Cancer Care (PCOP) proposal marks a significant step towards value-based reimbursement, fundamentally restructuring the way oncologists are paid for cancer care.

The group believes improved quality and reduced spending are possible by providing "sufficient payment" to support a range of typically unreimbursed services, including payment for care coordination and treatment planning based upon appropriate testing. Furthermore, PCOP would meet the criteria of an Alternative Payment Model as defined in legislation Congress enacted in an effort to repeal Medicare’s Sustainable Growth Rate formula.

"[PCOP] ensures that oncologists provide the highest quality of care by getting adequate time to review and apply new genomic-based targeted therapies and immunotherapies," says Dan Zuckerman, M.D., co-chair of ASCO’s Payment Reform Implementation Workgroup, in a statement. "This model incentivizes the right care for the right patient at the right time—precision medicine with compassion."

Central to ASCO’s proposal is addressing inadequate payment or currently uncompensated time for services critical to managing a complex illness. As part of basic PCOP model, the workgroup says oncology practices commit to delivering evidence-based care—ensuring patients receive the most appropriate tests and treatments, while avoiding unnecessary expenses. In return, oncology practices receive four supplemental, non-visit-based payments to support diagnosis, treatment planning, and care management. These monthly payments risk reduction if practices fail to adhere to evidence-based guidelines. Services like Evaluation & Management, infusions of chemotherapy, and drug administration in the practice setting will remain billable under the Medicare Physician Fee Schedule. However, for financially more aggressive practices, additional consolidated and bundled payment models are proposed.

"The savings from adequate care management and consistent application of appropriate use criteria are expected to more than offset the increased resources provide[d] to practices," writes ASCO in the PCOP overview. "Conservative estimates indicate a net reduction of at least 4 percent in total spending for payers … [but] various demonstration projects and studies in oncology suggest the savings potential is much greater."

PCOP Goes Further Than CMS’ Oncology Care Model
ASCO’s PCOP expands upon a previous draft payment reform model the group circulated last year and experts say, takes payment reform even one step further than the Centers for Medicare & Medicaid Services’ (CMS) Oncology Care Model (OCM). OCM, a multipayer payment and care delivery model, was unveiled by CMS earlier in the year, but was criticized for keeping fee-for-service (FFS) payments in place.

OCM is based on the oncology medical home concept. Like PCOP, OCM would pay oncologists in part on a per-member, per-month basis, with overall payments tied to financial accountability or risk, as well as quality. Participating practices would receive a $160 per-beneficiary payment on top of Medicare FFS payments for a 6-month episode of care. Additional semi-annual performance-based payments would be made for meeting a set of quality measures.

The second part of the plan involves shared-savings payments based on benchmark spending targets. The oncology practice can share in the savings achieved, if they reduce costs more than 4 percent below the target price.

"Payments are clearly moving away from FFS and toward increasing ties to value. But it is also clear that the major overhaul of physician payment that is coming with [Medicare Access and CHIP Reauthorization Act of 2015] is very much a work in progress," writes Mark B. McClellan, M.D., Ph.D., director of the Health Care Innovation and Value Initiative at the Brookings Institution, in ASCO Daily News. "It may be time to celebrate progress on payment reform, but it is also time to get to work to ensure that what comes next will fulfill the promise of better care and lower costs."

Takeaway: While 2015 is shaping up to be a breakthrough year in payment reform for oncology care, it remains to be seen whether alternative approaches to oncology payment succeed in improving quality of care, while controlling skyrocketing costs.

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