Prepare for the Looming Mandatory Risk-based Payment Model in Oncology

Over the summer, as anticipated, the Trump Administration announced several upcoming risk-based payment models, including a mandatory model focused on radiation oncology. Slated for early next year, the proposed model is expected to impact 40 percent of traditional Medicare beneficiaries receiving radiation therapy services.

Providers chosen to participate in the mandatory program will be forced to implement both operational and clinical changes while simultaneously receiving reduced reimbursement from the government.

The Radiation Oncology Model is expected to begin in early 2020.

The proposed Radiation Oncology Model, which is expected to begin by spring 2020 and end in December 2024, will be based on 17 cancer types commonly treated with radiation therapy. The site neutral prospective payment model is based on a 90-day episode of care triggered by the initial radiation treatment planning visit.

The Model is solely inclusive of radiation therapy services as opposed to a total cost of care bundled payment model. Payment will be split into a professional component for physician groups and a technical component for hospital outpatient departments or freestanding radiation oncology centers. Delivered in two installments, providers will be paid half at the beginning and half at the end of the episode, subject to performance on patient experience and quality metrics.

Providers should engage in preparation efforts now to learn how to manage risk in advance of future mandatory arrangements.

It is critical for organizations to effectively evaluate and proactively plan for the impact of value-based models taking on more risk. With millions in savings generated through Medicare accountable care organizations (ACOs) and bundled payment programs, these payment models are proving to be successful. As such, the Administration’s desire for risk-based payment models continues to escalate.

As it’s currently designed, day one of the Radiation Oncology Model will place providers at financial risk. The Model is evidence of the movement to align multiple provider types within a single value-based payment model. All providers will be reimbursed based on hospital-outpatient department rates. Having a solid understanding of the associated financial risk along with required administrative and clinical tasks is a key driver for achieving success.

There are four critical strategies for managing risk to consider as these payment models continue to roll out.

1. Conduct a financial and operational analysis to assess the impact of the new model. This can help your organization understand how to incorporate the new model into your overall population health and value-based payment strategy. Contrast historical performance with the proposed prospective model design to identify areas of opportunity. Evaluate the ability to leverage existing workflows or the need to implement change to drive cost efficiencies across population health activities.
2. Ensure timely and accurate documentation and coding. Perform a clinical documentation and coding analysis to ensure providers are fully documenting patients and using codes that are required for the model. The model may use specific codes for patient risk adjustment or for documenting performance on quality metrics. Clinicians need to understand the impact of complete documentation and ensure they have the capabilities in place at the organizational level for accurate documentation. Electronic systems need to make the process straightforward and less burdensome for providers.
3. Employ effective care management and communication. A high-functioning care management program is contingent upon alignment across providers, access to data that appropriately risk-stratifies patients, a culture of openness and communication, and the proper infrastructure to support it. It is critical for the care team to have access to vital information in order to provide high-quality patient care. For example, applying a process to identify high-risk patients in order to manage their symptoms and complications is pivotal in reducing high-cost care. Additionally, creating and implementing a data-driven, clinically-managed process for treatment delivery options and plans will create an element of standardization and lessen the burden on the care team. Care management programs that identify patient risk-factors and predict future outcomes will be able to reduce unnecessary treatments, which may result in improved quality of life for the patient and potential cost savings for the providers.
4. Engage and educate providers, staff and patients. Participation in a new payment model can require a major culture change that needs effective preparation, education and training. It is important to design and implement strategies and tools to support patients, providers, staff and corporate functions throughout the transition. Engage providers at the beginning stages of care redesign efforts to enable a smoother transition to improved patient care. Involve patients through a shared decision-making process to establish a personalized care plan. At first glance, managing care delivery across an entire episode may seem overwhelming. The key is to break it down and focus on incremental progress within a few key strategic areas, while remaining mindful of the potential impact on other population health initiatives.

Like other risk-based payment models have proven, when effectively implemented, they can be a powerful means to deliver highly-reliable care.

Learn more about building a successful risk-based payment strategy.