by Keely MacMillan
Sg2 Associate Principal
Medicare’s new Enhancing Oncology Model (EOM) is an important opportunity for oncology practices to participate in a voluntary alternative payment model (APM) designed to increase the value of care for Medicare fee-for-service (FFS) patients undergoing chemotherapy. This five-year model not only builds on the Oncology Care Model (OCM) and offers incentives to manage care while reducing spending under Medicare FFS, it also adds incentives to address health disparities.
Set to begin July 1, 2023, potential EOM participants must submit a nonbinding application by September 30, 2022, to secure their opportunity to participate.Both integrated health systems and independent oncology practices should consider the following questions when evaluating whether EOM is a strategic fit for their organizations:
Is my organization eligible to participate? EOM is accepting applications from oncology physician group practices (PGPs) identified by a taxpayer identification number (TIN). PGPs with oncologists who, to a limited degree, bill for cancer-related evaluation and management services under another PGP TIN can participate—a flexibility that was not offered under OCM. Hospitals and health systems can participate in EOM and enter into financial arrangements with EOM participants as Care Partners. Oncology practices that routinely refer beneficiaries to Prospective Payment System-Exempt Cancer Hospitals are not eligible to participate.
Which patients and costs are included? EOM applies to Medicare FFS beneficiaries receiving systemic chemotherapy for breast cancer, chronic leukemia, small intestine/colorectal cancer, lung cancer, lymphoma, multiple myeloma or prostate cancer. Patients receiving hormonal therapy only are excluded. This exclusion and more targeted focus on certain types of cancer are expected to reduce the volatile performance associated with low-priced episodes and low-volume cancer types. Like OCM, participants are responsible for the total cost of care for aligned patients, including Parts A, B and some Part D spending. Some episodes will be excluded, including episodes with CAR T-cell therapy expenditures and possibly episodes with inpatient or outpatient claims with a COVID-19 diagnosis.
What opportunities does EOM provide? Participants in EOM can earn Performance Based Payment (PBP) if their program spending comes in below a specified financial target. There is not a minimum threshold that has to be met beyond the target amount to receive PBP. Final PBP and Performance Based Recoupment (PBR) will be adjusted based on quality performance. Participants can also receive $70 Monthly Enhanced Oncology Services (MEOS) payments for the provision of enhanced services (such as patient navigation and documentation of patient-specific care plans) and an additional $30 MEOS payment for dually eligible patients. MEOS payments associated with nondually eligible beneficiaries will be recouped at reconciliation, while MEOS associated with duals is retained by the participant, regardless of financial performance.
EOM participants are also expected to receive monthly claims data for their aligned population that can be used for continuous quality improvement. Consistent with other innovation models, HHS is expected to issue fraud and abuse waivers to support flexible, innovative approaches to care management and patient engagement. Given the range of incentives, integrated systems may consider participating EOM to align specialty care with their broader value-based care efforts.
In response to stakeholder feedback, program design elements of EOM reflect modifications from OCM that are intended to lead to greater alignment of incentives. Changes include a modified attribution methodology, a more sophisticated risk adjustment methodology and a more advanced pricing model that incorporates cancer-specific target prices, trend factors and novel therapy adjustments. These methodological changes, as well as refinements to the inclusion criteria for patients, will need to be evaluated at the practice level to identify opportunities and risks.
What risks are associated with EOM? In addition to potential risks associated with the attribution, risk adjustment and pricing methodologies, all participants in EOM will be required to accept downside financial risk for the duration of the program. Specifically, if program spending surpasses a specified financial target, practices will be required to submit a repayment. Participants will have the option to pick between two different risk tracks and can switch between tracks on a semi-annual basis. Notably, the maximum upside is larger than the maximum downside in both tracks, and participants benefit from the protection of a minimum threshold for recoupment above the target price. Still, because of the requirement to take on downside risk, EOM may be best suited for providers with some experience managing total cost of care. For accountable care organizations (ACOs) with success in APMs, incorporating oncology care may be a strategic next step in the progression away from fragmented care. For past OCM participants, EOM may be a vehicle to continue providing enhanced services with added incentives to address health equity.
How do the health equity–related incentives and requirements of EOM align with my organization’s broader health equity strategy? EOM aims to advance health equity through a series of program requirements, including collecting and reporting beneficiary-level sociodemographic data, using health-related social needs (HRSN) screening tools to address health disparities, providing patient navigation, and establishing a health equity health plan. Providers can use the patent-pending Vizient Vulnerability Index™ as a foundation to develop a comprehensive, sustainable plan to address gaps in health equity and meet continuous quality improvement goals. Please reach out to us for more information on the insights it can provide.
How will my practice address drug-related costs and other levers for savings? Part B nd Part D drugs together are anticipated to represent a majority of spending in EOM. Providers that incorporate high-value prescribing may be well-positioned to achieve success in this model. To optimize success, organizations should align high-value prescribing, site of care optimization, inpatient utilization reduction strategies, pathway adherence and other levers for performance improvement with existing population health efforts.
Is my organization prepared for future payment changes? In late 2021, the CMS Innovation Center (CMMI) issued a strategy refresh that outlines their goal of having 100% of Medicare FFS beneficiaries and a “vast majority” of Medicaid beneficiaries in an accountable care relationship by 2030. Further, CMMI Director Liz Fowler has indicated the Innovation Center could make participation in models mandatory. When evaluating whether to participate in EOM, organizations must consider both the program-specific implications and their long-term strategy for success amid future payment policy changes.
If you are unsure if EOM is appropriate for your organization, consider submitting a nonbinding application by September 30, 2022, to preserve your opportunity to participate, especially considering CMMI has not indicated there will be another opportunity to apply. By applying, you are expected to receive valuable claims data that can be used to make a more informed decision about participation.Additional information about the model is available via Sg2’s educational web series.
About the author
Keely Macmillan leads engagements that assist healthcare organizations transition to value-based payment and delivery models. Drawing on deep payment policy expertise, she partners with provider organizations to identify and implement strategies for success in alternative payment models (APMs) including shared savings arrangements, capitation and episodic payments.