Ed Bassin, SVP Provider Specialty Solutions, discusses the key components, benefits, challenges and financial incentives involved in the CMS Oncology Care Model (OCM).
David Schafer: Welcome to the Specialty Care ValueCast, where we explore the evolving landscape of specialty care management through the lens of value-based care, insurance risk, and the patient and provider experience. In our first series of episodes we'll be focused on the Oncology Care Model. We'll cover topics including improving care quality and reducing costs through the CMS Oncology Care Model, providers taking on risk for oncology populations, controlling drug and care costs for patients, and helping to reduce the burden on providers so they can focus on patient care.
I'm your host, David Schafer, and in this first episode we'll be covering the CMS Oncology Care Model with Ed Bassin, a PhD statistician working as New Century Health's Senior Vice President of Provider Specialty Solutions. The Oncology Care Model, or OCM, is a voluntary healthcare payment and delivery model in that improving coordination of care for cancer patients and lowering costs in the Medicare program. The CMS Center for Medicare and Medicaid Innovation, or CMMI, launched this five-year model in July of 2016, and today there are 176 oncology practice participants, as well as 11 private payers who have committed to aligning with the model. So, Ed, I'll turn it over to you now, and I think it would be helpful if you could start out by talking a little bit about New Century Health. Who is New Century Health, and what do they do?
Ed Bassin: Hi, David. Thanks for having me here today. I enjoy being here. Let me tell you a little about NCH, New Century Health. We are a specialty care management company. We focus on helping both payers and providers to look at how best to provide care to patients with cancer, patients with cardiac disease, and other areas in ways that improve the quality of care. We'll also try to address the cost. We've been doing that for a little over 15 years now, and we've been successfully taking risk, both in oncology, cardiology, and other specialties.
David Schafer: Thank you, Ed, for that helpful overview. So, it makes sense that since one of New Century Health's specialty areas is oncology that the company is focused on the Oncology Care Model, and so I think it'd be helpful if we could start with the basics. What is the problem or problems that CMS is seeking to solve through the Oncology Care Model program?
Ed Bassin: First off, I think if you talk to different people, you'll probably get some different answers to that, but I think there are two core problems that they're trying to address. One is a fragmented care delivery model for patients, one that can be inefficient, one that can make the patient's cancer journey more difficult, one where there isn't somebody who's responsible, necessarily, for the patient's entire journey. So, it's trying to align the care delivery system more with the patient's experience, and thereby to improve the patient's experience overall. Meanwhile, CMS is also looking at oncology and saying that it's the fastest growing specialty in terms of cost, so they need to figure out ways to improve the care, but also to recognize the imperative of budgetary responsibility and to address the rising costs, or at least try to, that are occurring within cancer care.
David Schafer: Great. What are the basic parameters of the model? How does it purport to change the way cancer care is delivered and how care is paid for in Medicare?
Ed Bassin: So, the first part is how does it try to change the way that cancer care is delivered. For that, there are both prescriptive and incentive-based, so from a prescriptive perspective, there are a number of requirements for what practices have to do. They're required to provide care navigation, and all the practices who are participating have some level of care navigation that they're doing. It's trying to change the focus again to be more holistic, so there's a requirement of having a 13-point IOM care plan. Practices are required to use an electronic medical record. They're required to talk about advanced directives with their patients. They're required to talk about survivorship planning, two extremes of the outcomes.
They're required to share more information with the patients about expected costs of care, although it's very, very difficult to know exactly what it's going to cost, or even to estimate what it's going to cost. So, there are a number of requirements that the program starts with. At the same time, the program creates incentives for the practices that if they're able to reduce the total cost of care for their patients that they can get a share, up to 100%, of the savings after a discount, up to 100% of the savings for the patients. So, there are incentives for practices to innovate, to identify places where they can improve the cost and quality of their patients' care and experience, and thereby to achieve Medicare's ultimate goals.
For instance, most of the practices who are participating recognize that reducing unneeded emergency department visits and reducing inpatient stays for complications of treatment is a goal, and it's an imperative if they're going to reduce cost. So, many of the practices have done some form of risk stratification to identify the patients at highest risk. It may be social determinants of care, it might be the treatment regimen that the patient's following. We work with practices, we have our own model for doing that. They're able to identify patients who require more proactive care management resources to use their resources more effectively.
The second thing that I remember seeing in practices is... In fact, one of my favorites that I saw was a practice that gave every patient an armband that said, "Call us first," and had the practice's phone number. So, if the patient had complications of care — unless they're life threatening — but if they were suffering from extreme nausea or diarrhea, or any of the other common complications that aren't necessarily imminently life-threatening, instead of calling 911 they call the practice. The practice could give them an experienced oncologist or an experienced oncology nurse who could then talk them through the process and help them maybe to avoid an ER visit, potentially avoid an unneeded inpatient stay, maybe bring them into the office, maybe even give them some home remedies that they can use. So, that's one area that they've dealt with.
The second area in that incentive... It's very hard to ignore the elephant in the room, or the 800-pound gorilla, or whatever you want to call it. Over half of the costs in these episodes are the drugs, and what we know is that if you don't reduce the cost of the drugs or you don't prescribe more efficiently, or you don't prescribe in a way that helps to address that, you're going to have a hard time getting a lot of savings. In effect, this program does change the incentives. If you're able to provide the same cost or even better quality care at a lower cost, that money flows back to the practice, and that's an important part of it, is that the practice now has an incentive to find more cost effective ways.
I emphasize the word effective; not just lower cost, but more cost effective ways to treat their patients. We, at New Century Health, have been managing chemotherapy and other forms of cancer treatment costs for over 15 years, and we have a track record of being able to help providers and help payers to reduce those costs and to use them more effectively through a combination of consulting that we do with the practices, through the use of of value-based treatment pathways, evidence-based treatment pathways, education. We've been able to help people to reduce their drug spend. We're helping people now to reduce their inpatient spend and to give the patient a better experience.
David Schafer: Thank you, Ed, for that comprehensive answer. I think it's great to hear about all of the good work that New Century Health is doing, not only for the practices, but also for those being serviced in the Oncology Care Model program. Now, I'd love to talk a little bit more about the OCM opportunity for oncology practices. You briefly talked about that in your last answer, but I'd love if you could specifically talk about how some of the practices are doing so far, and what are the considerations for practices as they look at and participate in this model, both now, but also going forward?
Ed Bassin: So, when I first came into oncology, one of the things that struck me is how many services oncology practices provide for which they're not compensated; that aren't billable. One of the things that this program does is to give those practices money and incentives to think about how best to treat their patients, whether it's improving the financial counseling, adding social workers... One relatively small practice that I saw had full-time chaplain services available to their patients. That was something that they paid for out of their own practice general funds; they couldn't bill Medicare for it.
This is a way for them to have incentives to provide a comprehensive and a thoughtful set of services to meet their patients' needs. That, to me, was the most striking thing when I first learned about oncology and OCM and really started thinking about how misaligned the historical fee-for-service reimbursement model has been with what practices do. So, this is a way for practices to get paid for the things that they do and that help their patients. That's number one. I think one of the considerations that practices have to go through is — this is a business question — they have to be financially solvent. It doesn't help their patients if they become insolvent.
So, they have to think about how is it that they can provide services that improve the patient's cancer care journey, or cancer journey? How is it that they can change what they're doing to better align with the needs of their patient? In a world that's more than how many visits can you have that are billable, and what kinds of drugs can you prescribe, and what are your margins, it's really trying to help practices do what oncologists really want to do, which is to treat patients and be paid for treating their patients. That, to me, is that the opportunity that lies in front of them. It is a real change, and I met with over 20 practices, worked with over 20 practices in this role and in prior roles, and one of the hardest things is that a fee-for-service world is about getting up in the morning, seeing as many patients as you can, doing as many things as you can, being billable.
This is a consideration for how best can I have that patient get treated? How do I think about my patient holistically? Especially if we look at a two-sided risk model, the practices are going to get a specific episode-based payment, and out of that episode-based payment it doesn't matter if they bill for more office visits or more infusion services. They're going to get the same basic payment. So, what they have to think about is to think about that patient's care journey holistically. How do we improve it? Not only what can we get paid for, but what are the things that are happening that aren't necessary?
The inpatient and the ER visits is a classic case of that, but there are others. How do we make that patient's care journey more effective, and think about themselves as being responsible for the quality of the patient experience, but also stewards of the money? There is a fixed pool of money out there, and if they use that pool well, if they use services efficiently, practices can benefit substantially. At New Century Health we believe that because we've done it for 15 years and we know that there are inefficiencies in the system that we can improve. That's the opportunity that lies in front of the practices, improving their patients' experience and profiting at the same time.
David Schafer: Great. Thank you so much. I think the light you shed on the OCM program is very interesting and hopeful for its ability to drive improvements in the journey for people going through cancer care treatment. Well, Ed, thank you so much for your time. That's all we have for today. Stay tuned for our next episode, where we'll dive deeper into the OCM model and how it looks from the perspective of a participating oncology practice.
The Specialty Care ValueCast is produced by New Century Health, a specialty care management company focused on oncology and cardiology, with nearly two decades of experience improving health outcomes and reducing costs for provider and payer organizations.