To date, none of the Medicare bundled payment programs have included oncology episodes of care, other than the OCM pilot. In August 2012, Humana and 21st Century Oncology, a large for-profit radiation oncology multi-site provider, executed the first agreement to reimburse radiation therapy services on an episodic basis for almost all cancer cases. Four years later, Anthem Blue Cross of California contracted with Valley Radiotherapy Associates Medical Group for a bundled payment for patients with a breast cancer diagnosis requiring radiation therapy treatment.
Now, the American Society for Radiation Oncology is promoting an alternative payment model for radiation oncology therapy services known as RO-APM. This model proposes a common payment framework for five primary disease-sites (breast, lung, prostate, colorectal, and head and neck) and two secondary disease-sites (bone and brain metastases).
Like other bundled payment models, RO-APM would be triggered by an initial radiation therapy treatment code and end 90 days after the last radiation therapy treatment. Throughout treatment, participating physicians would be required to adhere to specific, nationally accepted radiation therapy treatment guidelines.
The target price for radiation therapy services would be based on the provider’s historical reimbursement rate, as compared to regional and national benchmark rates for the same episode of care. But rather than receiving normal fee-for-service reimbursement throughout the patient’s treatment, radiation oncologists would be paid a portion of the target price at the beginning of the episode, along with a monthly patient engagement and care coordination fee.
If total payments made through the course of treatment are below the target, the radiation oncologist then would receive the difference, provided specified performance standards are met. Conversely, a provider would be responsible for repaying any overages (up to a certain amount) should payments exceed the target price.
At present, there is no specific timeline for Medicare to proceed with any new mandatory bundled payment model. If Medicare does go forward with a radiation oncology model, it may or may not resemble RO-APM. Based on prior experience, impacted providers likely would have about six months following the model’s announcement to prepare for its implementation.
What’s happening in radiation oncology has an immediate impact on the 20 percent of community medical oncologists whose practices offer that service. It also is a bellwether for how CMMI is likely to approach chemotherapy beyond OCM. Medical oncologists will likely claim episodic bundles are problematic due to the complexity of the service they provide, the significant variance in their patients’ clinical scenarios, and the lack of medical record interoperability limiting their ability to affect costs they neither prescribe nor are aware of. Irrespective of the validity of such claims, CMMI has signaled that the episodic payment models are a proven methodology that that they intend to expand upon.