CMS Oncology Care Model: How Big Was the Leap of Faith?

Dawn Holcombe, MBA, FACMPE, ACHE
President, DGH Consulting, South Windsor, CT

June 30, 2015, was the deadline for submission of practice-based applications to the Center for Medicare and Medicaid Innovation (CMMI) for the Oncology Care Model (OCM). The dust has settled. Those who were going to apply have done so, and those who decided not to, have watched the hustle and bustle during June with some amusement.

I worked closely with a number of oncology practices that had decided to submit their application, and, as usual, have had the good fortune to talk with many groups across the country in the past few months during the submission process.

There are several lessons to be learned from the process, and some implications for all those involved in oncology. Whether any given oncology provider or payer chose to submit a Letter of Intent (427 groups did), and whether they followed up with a full application, the oncology market has now forever been changed by events of the 3 months related to the CMMI OCM. This includes care coordination, patient navigation, patient care management, as well as the other elements discussed below.

Care Coordination

Care coordination fees are now on the table. Although the payment rate will still be up for negotiation and debate, when the nation’s largest single payer put forth a proposal to pay oncologists a per-patient per-month payment for coordinating care, they set a very visible precedent.

The lesson for practices is that if they are willing to meet specific care access and technology capability requirements, they will qualify for care coordination payments for all patients for defined episodes of care. The lesson for payers should be that care coordination payments should be just that, and should apply to all patients regardless of the treatment choice or a drug regimen.

Care coordination is for the cognitive and physical resources expended in the care of patients. Some “care management” fees have been offered to practices but have been tied to specific treatment regimens and only paid for certain patients. Those fees suffer in comparison to a true care management fee that encompasses care provided to all patients.

Patient Navigation

Defined as the core functions of patient navigation from the National Cancer Institute (NCI), patient navigation is now presented as an expected element of practice-based care. Patient navigation has often been associated with hospital systems or payer systems. Although many practices believe they already performed good patient navigation, when faced with the itemized list from the NCI, it became clear that this was going to be a more focused effort that would require dedicated staff and functions.

The oncology medical home model brings in some of these elements. The CMMI OCM program pulls these core functions into the heart of the oncology practice, and puts a spotlight on each of the elements—for the first time in the practice of everyday medicine. How many practices now arrange for transportation and/or child or elder care instead of leaving that responsibility to the patient?

Patient Care Management

More than a decade ago, the Institute of Medicine (IOM) published a report on the state of quality in cancer care. In its 2013 report, Delivering High-Quality Cancer Care: Charting a New Course for a System in Crisis, the IOM commented that we have not come very far yet compared with a decade ago. The IOM identified 13 elements of care management. By including these specific elements of care management in the OCM model, CMMI has now forced a national spotlight on those elements, causing all practices to assess how they were going to be able to deliver those elements. Most oncology practice systems do not have fields to track the details of those elements, let alone allow for trend reporting and benchmarking. Most practices would likely happily attest that they fulfill this requirement, but will be challenged to prove and act upon that fulfillment.

Few oncology practices today actually provide their patients with a complete care plan that includes a prognosis, identification of treatment goals, expected response to treatment, the patient’s likely quality of life with this treatment, and the estimated total and out-of-pocket costs of cancer treatment, among other elements. If we start to provide patients with all those elements, it will become a transformative event in the history of cancer care.

Identifying Patients

It may sound strange, but so many oncology practices and even large hospital-based cancer centers found it challenging to produce a complete patient cost (all patients, active patients, active patients with chemotherapy). Billing systems and electronic medical records are not set up for population reporting and management. This was usually the first hurdle that practices faced when attempting to complete an OCM application, and the CMMI OCM model was a wake-up call to many oncology practices that something that seemed so obvious should be so difficult to attain.

Projecting Total Costs of Care

To estimate performance-based payments, practices had to calculate what they receive from Medicare and what Medicare probably incurs in total costs for the practice’s Medicare beneficiaries. Hospital-based programs would seem to have an advantage, because they bill Medicare for a higher volume for Part A and Part B services for their patients. Physician practices only have direct knowledge of Part B costs they bill out of their own offices.

It will be interesting for CMMI to read the applications and see how differently these costs were estimated across all applicant practices. There is a hope that CMMI will make its actual total costs for Medicare beneficiaries available to selected practices before the final agreements are signed. The concept of understanding the total costs of care, and the ripple effect that individual care choices and patient care management can have on those total costs is the very foundation on which this OCM program was developed. Putting not only awareness of total costs of care but also actual data on those costs for benchmarking and continuous improvement could be the most effective part of the project.


We still do not have the tools we need to perform under even the most basic expectations of the CMMI OCM model, let alone advance to greater sophistication. Some practices borrowed from software and solutions now exclusive to the managed care market, whereas others relied on Excel spreadsheets and more complicated reporting. Great pressure will be placed on the oncology technology vendors to up their game and deliver modifications that will allow for this new performance model.

Projecting Performance-Based Payments

Practices were operating under a complete unknown in this scenario, because CMMI has not yet defined the specifics of the benchmarks and any adjustments that will affect the total dollars available for distribution. In addition, oncology practices had to estimate their likely success and percentages of meeting the quality and performance measures.

Many practices realized that although they had been successfully participating with the American Society of Clinical Oncology Quality Oncology Practice Initiative (QOPI), and some were even certified QOPI practices, QOPI participation was achieved through chart review. Chart review is fine for episodic sampling but not for full reporting of performance measures. Technology solutions to meeting these quality and performance measures were a challenge to the practices and a strong eye-opener, regarding how far we still have to go in terms of measuring and improving quality care.

Practice Culture Commitment and Transformation

Some practices approached the CMMI OCM application as a group effort, parsing out different respon­sibilities and learning through the team discussions, leading to a transformative energized commitment from the whole group. More often, 1 person (usually an administrator, occasionally a physician) was tasked to complete the application, making final drafts available to the practice physicians for review and minor commentary. Are those practices waiting for the final signing component to decide to move forward or not? Are they fully engaged mentally, but holding off expending too many resources until they know if they have been accepted as one of the 100 groups for which CMMI is looking? Or do they see this as yet another healthcare reform experiment, and will play along until the performance reporting years kick in?


A different level of practice competition was introduced in the CMMI OCM program. By broadcasting that there were more than 400 Letters of Intent filed for just 100 accepted application slots, CMMI created a competitive application process. Even phone groups and practice associations that were built to help practices understand and craft their responses saw an element of restraint. Practices were observed by this author as willing to talk about their strategy and approach to the implementation plan only after the June 30, 5 pm, submission deadline had passed. Each was looking for a different hook to draw the attention of the CMMI reviewers.

This was a scary project to attempt. The reporting and projection of total costs of care, in addition to the development of detailed patient navigation and care management, was new to most practices that responded. Many estimates and assumptions had to be made. Most practices would agree that the $160 per-patient per-episode per-month payment is not sufficient to cover the true costs of implementation of the applications. Our current technology systems do not come close to providing the data that we are being asked to track and, more important, report on and review for continuous quality improvement. It is clear, though, that no matter how many applications are finally and completely submitted, any accepted practice is going to operate in a different way from the first day of the contracted period.

Payers and physicians on the private side are going to change their discussion points as a result of the practice going through this process and better understanding the concepts of patient navigation, care management, performance, and benchmarking.

Care coordination and care management fees will become more commonplace in contract negotiations. Total cost of care will become far more important to providers and to payers and a starting platform for collaborative oncology management discussions. With apologies to L. Frank Baum’s The Wonderful Wizard of Oz, “Toto, we are not in Kansas anymore,” the conversations and rules between payers and providers have now changed dramatically and permanently, and all as a result of these 3 months of flurried activity surrounding the CMMI OCM project.

The oncology practices that submitted their applications—CMMI will not yet reveal how many applications they received—made tremendous leaps of faith. They built those applications on estimates, projections, and held the faith that if they change x, y will happen, and they will be rewarded. That was a huge leap of faith. The success of that leap remains to be seen.

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