On September 18, the Centers for Medicare & Medicaid Services (CMS) released its final rule for a new advanced payment model (APM) for radiation oncology (RO) services. The new model is intended to improve the quality of care for cancer patients receiving radiotherapy (RT) by moving toward a simplified and predictable payment system. It has a five-year model performance period beginning July 1, 2021. (Although the RO model was originally slated to begin January 1, 2021, CMS announced on October 22 that it had received feedback from a number of stakeholders about the challenges of implementing the model by that date. Based on this feedback, CMS intends to delay the RO model start date to July. CMS will pursue a rulemaking to make this change.)
The new RO model marks a significant departure from Medicare’s historical fee-for-service (FFS) payment approach and will be mandatory for all RT providers falling within a set of randomly selected geographic areas (see figure 1), which collectively are estimated to account for 30% of eligible Medicare RT episodes.
Click here to see the full list of zip codes in the participating areas.
Background on Radiotherapy Payment Reform
The RO model aligns with broader trends in healthcare, including bundled payments, to shift from volume to value through the use of APMs. CMS has indicated the need for payment and service delivery reform in RT, pointing to the lack of site neutrality for payments in this area as well as variability in clinical care patterns. The current FFS payment system incentivizes selection of RT treatments that are more expensive or require more services over time. The new model will encourage providers to select more cost-effective treatment options.
RO Model Details
The RO model is designed to test whether bundled, prospective, site-neutral, modality-agnostic, episode-based payments for RT lead to improved quality of care for Medicare beneficiaries and reduced spending for the program. Key features are outlined below.
- Episode Definition: The final rule defines an episode of care under this model as a 90-day, prospective episode that is triggered when a patient receives an initial RT treatment planning service and then begins treatment. There will be both a professional and technical bundle for each episode. The episode payments:
- Will be based on certain cancer types (see below).
- Will not be differentiated based on type of treatment.
- Are not intended to cover the total cost of a patient’s oncology care during the time frame.
- Payment Methodology: CMS will cover prospective payments for RT services performed during the 90-day episodes for the 16 cancers listed below. Payments are site neutral and modality agnostic, and additionally linked to performance on quality measures, clinical data reporting, and patient experience factors. Furthermore, payments are split into the technical component (TC) and professional component (PC) in order to maintain compliance and functionality with current PFS and OPPS claims systems.
- Cancer Types Included: The final rule identifies 16 different types of cancer to be included in the RO model, as listed below. CMS assessed several criteria to identify appropriate cancers for inclusion in the model, ultimately selecting cancers that are most commonly treated with RT, make up the majority of all cancer incidence, and have demonstrated ongoing pricing stability.
- Pilot Mandatory Participants: The pilot will be mandatory for physician group practices (PGPs), hospital outpatient departments (HOPDs), and freestanding RT centers located in any of the selected participant zip codes. RO model participants are categorized as professional, technical, or dual participants.
- Quality Measures: Starting in January 2021, the four quality measures listed below will initially be utilized in order to allow for a pay-for-performance methodology focused on performance in clinical care (model years one and two). CMS will use the results of the 2021Consumer Assessment of Healthcare Providers and Systems (CAHPS) Cancer Care Radiation Therapy Survey to determine which patient experience measures will be proposed for model years three through five. Participants will also be required to submit clinical data elements pertaining to breast, lung, brain, bone, and prostate cancer types on a biannual basis.
The four quality measures are as follows:
- Oncology: medical and radiation: plan of care for pain
- Treatment summary communication: radiation oncology
- Preventive care and screening: screening for depression and follow-up plan
- Advance care plan
- RO Model Episode Pricing: As noted above, prospective payment bundles are split into TCs and PCs, which are further adjusted downward by 3.75% for the PC and 4.75% for the TC. Three additional payment withholds will be applied for incorrect payments (1% for both PC and TC), quality (2% for PC), and patient experience (1% for TC starting in 2023). Participants in the model will have the opportunity to earn back some or all incorrect withholds based on prior-year performance and payments.
ECG continues to examine the final rule for RO services. Our next post will outline operational, financial, and strategic implications to help applicable providers prepare for participation in the program.
Published September 23, 2020