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Cost savings do not justify use of CMS oncology alternative payment model: study

by John R. Fischer, Senior Reporter | November 17, 2021
Insurance Rad Oncology
Drops in imaging for Medicare patients did not result in significant savings with the use of CMS' alternative oncology model
Drops in imaging for Medicare patients did not result in significant savings for the use of the Centers for Medicare & Medicaid Services’ oncology alternative payment model.

The first three years were associated with 46 fewer imaging services used per 1,000 care episodes. The decrease was attributed to greater coordination among 200 physician practices, as was agreed upon when the five-year model was first enacted in 2016, along with efforts to reduce unplanned care for patients undergoing chemotherapy, according to new research published last week by researchers at Harvard Medical School.

But when it came to the model’s impact on healthcare spending, the researchers found that it did not produce enough of a decrease to substantiate CMS’ investment into it, with Medicare episode payments falling by only $297 per episode (about $18 fewer on imaging).

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“In its first three years, the OCM was significantly associated with modestly lower Medicare episode payments that did not offset model payments to participating practices, and there were no significant differences in most utilization, quality, or patient experience outcomes,” wrote the authors in their study.

They compared care for more than 483,000 Medicare fee-for-service beneficiaries during six month episodes at 201 model-participating practices to 557,000 cared for by 534 practices that did not use the model. Participating practices saw total episode payments go up from $28,681 to $33,211, while non-participating ones saw an increase from $28,421 to $33,249. Average imaging costs rose from $812 to $824 in the intervention group and from $814 to $843 in the comparison group, with a difference-in-differences of $18 (-2.2% change). The authors estimated a roughly 1% decrease in the use of imaging services per episode versus the comparison group.

In a corresponding editorial, Raymond Osarogiagbon, of Baptist Memorial Health Care Corp., says that while a disappointment, the negative finding does not mean that the model is not helpful. “One of the chief concerns of value-based payment models is the theoretical risk that financial incentives will induce restrictions in essential care. The OCM had no demonstrable adverse effects on care quality, and in that important respect represents a positive outcome.”

The findings were published in JAMA.

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