Practices participating in CMS' Oncology Care Model had 2 percent to 4 percent higher actual Medicare costs per episode, on average, compared to nonparticipants during the bundled payment program's first two performance periods, according to a new analysis.
CMS' oncology model launched in 2016 as a five-year, voluntary bundled payment program that spurs practices to improve care at a lower cost via episode-based cost performance and quality measures. Practices receive performance-based payment if costs per episode do not exceed their spending objective during a six-month performance period.
For the analysis, healthcare consulting firm Avalere examined the care model's first two six-month performance periods — spanning July 1, 2016 to June 30, 2017 —using federal Medicare Part A/B fee-for-service claims and Part D prescription drug event data.
The analysis found that actual Medicare costs per episode during the two performance periods were 2 percent to 4 percent higher compared to those not participating. CMS' prediction model for the program projected the difference would be 0.5 to 1 percent.
The difference between the actual and predicted per-episode costs might be because of key risk factors missing from CMS' prediction model, Avalere said.
The prediction model was established by CMS to estimate how risk factors, such as type of cancer and the patient's chronic conditions, affect each episode’s total Medicare costs.
"If the OCM's prediction model underestimates actual costs, then success for practice participants becomes more difficult," said Lance Grady, managing director at Avalere, in a news release. "We expect CMS to continue to improve the model, as it recently said it would incorporate stage-of-tumor information for breast, lung and prostate cancers into the prediction model."
Read more about the analysis here.
Morgan Haefner contributed to this report.
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