What is the Oncology Care Model?

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The Oncology Care Model (OCM) is the name of a pilot Medicare project carried out under the Affordable Care Act that aims to make cancer treatment less expensive while also improving the quality of care.

Currently, Medicare uses a system known as fee-for-service: a physician performs some service for his or her patient, and they are paid for it. This system only pays doctors for doing something, whether it is prescribing more drugs or ordering more scans and tests. Thus it rewards high-volume doctors, no matter whether what they're ordering is actually doing any good or not.

The Oncology Care Model would instead establish a top price for doctors when treating a cancer patient; if they can keep the price under the established amount, they would be rewarded financially for doing so.

The idea is not to encourage doctors to do less for their patients, but rather, to encourage them to avoid making treatment decisions that are considered wasteful and pointless.

The way it would work is this: A target price is determined that would cover the complete cost of care for a single patient over a time frame of six months. That time frame would begin when the patient is prescribed chemotherapy.

That target price is determined by looking at a doctor's historical costs for treating patients with similar cancer diagnoses.

After six months, Medicare adds up all the costs for that patient—costs that include chemotherapy, other drugs, scans, tests, everything—and they would compare it to the target price. If the doctor treated that patient for less than the target price, they would be paid the difference. In other words, if treatment costs totaled $20,000 and they only accrued $18,000 in costs, Medicare would pay the doctor $2,000.

The Centers for Medicare and Medicaid Services (CMS) hopes to recruit 100 oncology practices by the time this pilot project is scheduled to launch in spring of 2016. It is intended to run for five years.

Participating practices will receive a payment of $160 per month per patient to help to cover the costs associated with managing a patient's care [note: this is not a payment to patients, nor is it a payment meant to directly help these oncology offices reduce the financial burden on patients].

This project will include CMS monitoring the quality of care delivered as well, although the measures they will use to determine quality of care have not been fully determined.

The Patient Experience

Benefits for patients would include receiving a detailed treatment plan that shows them what they can expect, although otherwise experts say the patient experience won't change much, if at all.

However, in order for an oncology practice to participate in OCM, they must meet some requirements, which include:

  • Providing 24/7 patient access to a clinician who has real-time access to the practice's medical records
  • They must use ONC-certified electronic health records (Office of the National Coordinator for Health Information Technology (ONC) Certification Program: more info HERE)
  • They must treat patients with therapies "consistent with nationally recognized clinical guidelines".

Cancer Types Included

OCM will not apply to all cancer types, but this has less to do with cancer type and more to do with standard treatments for cancer types. Specifically, cancers that are treated exclusively with surgery, radiotherapy, or topical chemotherapy will not be included.

All cancer types treated with non-topical chemotherapy in an outpatient setting will be included.

More Information

This program is essentially designed to reward doctors whose cancer patients continue to live while under their care, as opposed to a system that rewards doctors for ordering as many tests and prescribing as many drugs as possible.

There is a detailed FAQ by CMS HERE (opens as PDF).

To read more about OCM in general, visit the CMS Innovation Center page dedicated to explaining it, which can be found HERE.

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