The Centers for Medicare & Medicaid Services has announced it is developing a new bundled payment model for oncology.

The Oncology Care Model (OCM) is a new payment model for physician practices administering chemotherapy. Under OCM, practices will enter into payment arrangements that include financial and performance accountability for episodes of care surrounding chemotherapy administration to cancer patients.

OCM will target beneficiaries receiving chemotherapy treatment and the spectrum of care provided to a patient during a six-month episode following the start of chemotherapy. Physician practices that furnish chemotherapy treatment may participate in OCM. In addition, in order to participate in OCM, CMS indicated practices must:

  • Provide the core functions of patient navigation;
  • Document a care plan that contains the 13 components in the Institute of Medicine Care Management Plan outlined in the Institute of Medicine report, “Delivering High-Quality Cancer Care: Charting a New Course for a System in Crisis”;
  • Provide 24-hours-a-day, 7-days-a-week patient access to an appropriate clinician who has real-time access to practice’s medical records;
  • Treat patients with therapies consistent with nationally recognized clinical guidelines;
  • Use data to drive continuous quality improvement; and
  • Use an Office of the National Coordinator-certified electronic health record and attest to Stage 2 of meaningful use by the end of the third model performance year.

OCM will use a two-part oncology billing payment approach for participating oncology practices. They are: 1) a monthly $160 per-beneficiary care management payment for Medicare FFS beneficiaries; 2) a performance-based payment for OCM episodes.

The per-beneficiary-per-month (PBPM) payment for enhanced services will offer participating practices financial resources to aid in effectively managing and coordinating care for Medicare fee-for-service beneficiaries. The performance-based payment will be determined based on the practice’s achievement and improvement on specific quality measures.

CMS noted that participants will receive regular Medicare fee-for-service payments during the model. Performance-based payments will be calculated retrospectively following the completion of a six-month episode.

OCM will cover nearly all cancer types. Episodes will begin on the date of an initial chemotherapy administration claim or an initial Part D chemotherapy claim and will not include services provided prior to that date. OCM episodes will include all Medicare A and B services that fee-for-service beneficiaries receive during the episode period; certain Part D expenditures will also be included. Episodes will terminate six months after a beneficiary’s chemotherapy initiation. The PBPM payment will be discontinued for beneficiaries who enter hospice care. Beneficiaries who receive chemotherapy after the end of an episode will begin a new six-month episode.

CMS stated it is also seeking the participation of other payers in the model.

Practices and payers interested in participating in OCM must submit a letter of intent. All application materials and submission deadlines can be found on the OCM website.