Today, the CMS Innovation Center posted the transcript for awebinar announcing a new innovation model which creates incentives to furnish efficient, high quality care by enhancing services for Medicare beneficiaries undergoing chemotherapy for a cancer diagnosis. The Oncology Care Model (OCM) will be a five-year program for physician group practices and practitioners in solo practice that provide care for oncology patients undergoing chemotherapy for cancer. Payers can also participate in the OCM by partnering with CMS.

The CMS Innovation Center was created by the Affordable Care Act to test innovative payment and service delivery models to reduce CMS expenditures while preserving or enhancing quality of care for CMS beneficiaries. Cancer is one of the most common diseases in the U.S. and about half of those diagnosed with cancer are Medicare beneficiaries. This new model will be consistent with HHS Secretary Burwell’s “Better, Smarter, Healthier” approach to improving U.S. healthcare, by moving Medicare toward paying providers based on the quality, rather than quantity, of care.

Model Design

The OCM will use aligned financial incentives, including performance-based payments, to improve care coordination, appropriateness of care, and access for beneficiaries undergoing chemotherapy. The model intends to improve health outcomes, produce higher quality care, and lower costs. Other payers would also benefit from savings, better outcomes for their beneficiaries, and information gathered about care quality. Payers that participate will have the flexibility to design their own payment incentives to support their beneficiaries, while aligning with the Innovation Center’s goals for care improvement and cost reduction. About 100 practices are expected to participate in the model and practices must participate for the entire five-year period. If a practice doesn’t achieve savings by the end of the third performance year, it will be disenrolled from the model.


The OCM will target beneficiaries receiving chemotherapy and the spectrum of care provided to a patient during a 6-month episode following the start of chemotherapy. Physician practices that provide chemotherapy treatment may participate in the OCM. To participate in the OCM, practices must abide by other requirements including documenting a care plan; providing 24 hours a day, 7 days a week patient access to an appropriate clinician who has real-time access to the practice’s medical records; and using data to drive continuous quality improvement.

Concurrent participation in shared savings programs, such as Pioneer Accountable Care Organizations (ACOs), the Medicare Shared Savings Program, or Comprehensive Primary Care, will be allowed. Provider-based departments of prospective payment system (PPS)-exempt cancer hospitals and other physicians not paid off of the Medicare Physician Fee Schedule for physician services may not participate in the OCM.

Payers that participate should share the Innovation Center’s opportunity to improve care for their beneficiaries and realize cost savings while enabling practices to make broader changes. Commercial payers, Medicare Advantage plans, state Medicaid agencies, and other governmental payers such as TRICARE, FEHBP, and state employee health plans may participate in the OCM through a Memorandum of Understanding with CMS.


The OCM will use a two-part payment approach to furnish enhanced services for beneficiaries undergoing chemotherapy and to incentivize improved quality of care: (1) A $160 per-beneficiary-per-month (PBPM) payment and (2) a performance-based payment, based on the practice’s achievement and improvement on quality measures listed in the Request for Applications. Participants will receive regular Medicare FFS payments during the model. Performance-based payments will be calculated retrospectively following the completion of a 6-month episode. 

Application Process

Physician group practices and solo practitioners that provide chemotherapy for cancer and are currently enrolled in Medicare may apply to participate in the OCM. Other payers, including commercial insurers, Medicare Advantage plans, state programs, and Medicaid managed care plans, can also apply. Interested payers must submit a letter of intent (LOI) to by March 19, 2015. Interested practices must submit LOIs by April 23, 2015. The names of those submitting LOIs will be posted publicly to facilitate cooperation between payers and practices prior to model implementation. Payers and practices must then separately apply to participate in the OCM before June 18, 2015. 

For more information on this model, visit the OCM website. If you have any questions or would like our assistance when considering whether to apply to the OCM or analyzing how the OCM will affect your practice or business, please contact one of the Hogan Lovells lawyers listed in the “Contacts” section.