CMS introduces new payment model for radiation oncology

CMS introduces new payment model for radiation oncology

by John R. Fischer, Senior Reporter | September 22, 2020
Insurance Rad Oncology
CMS has finalized a new payment model for radiation oncologists administering radiotherapy to Medicare beneficiaries
CMS has unveiled a new payment model to improve cost efficiency in radiation oncology. The model is scheduled to take effect on January 1, 2021, but ASTRO and the ACR have called for delaying implementation so providers can have at least six months to prepare.

“Today, Medicare payment for radiotherapy is based on the number of treatments a patient receives and where they receive it, which can lead to spending more time traveling for treatment with little clinical value,” said CMS administrator Seema Verma in a statement. “That’s why the Trump administration has developed a new, innovative model that allows patients and providers to focus on better outcomes for patients.”

The new Radiation Oncology (RO) Model is expected by the agency to create simpler, more predictable payments and reduce Medicare expenditures through bundled payments across a 90-day episode of care for 16 different cancers. It is estimated that the model will save Medicare $230 million over five years.

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The model requires participation from radiotherapy providers and suppliers that offer their services within randomly selected geographic areas that contain approximately 30% of all eligible Medicare fee-for-service radiotherapy episodes nationally.

In a statement, ASTRO argued that such a requirement goes too far for an untested model and goes against its recommendation that CMS establish a voluntary model and then transition it to a mandatory one with opt-outs for low volume practices and hardship exemptions. It plans to ask Congress to delay the RO Model before the end of the year.

“Requiring practices to participate and then forcing them to start the model on January 1, 2021, is untenable for practices already enduring staff shortages and other challenges due to the COVID-19 pandemic,” it said in a statement. “The transition to value-based payment will require significant practice changes and investments to comply with the model's requirements. ASTRO strongly urges CMS to significantly delay the start date rather than foster unnecessary chaos and burden for the practices this model is designed to support.”

Medicare currently reimburses providers and suppliers for each individual service they complete, and pays for radiotherapy depending on whether a patient receives care in a hospital, outpatient department or free-standing radiation therapy center. The payment systems for these different locations offer different rates, which can incentivize Medicare providers and suppliers to provide radiotherapy over more visits or deliver it in one setting over another. This can create extra costs for patients, even though the actual treatment and care is the same.

Participant-specific payment amounts are determined based on national base rates, trend factors, and adjustments for each participant’s case mix, historical experience, and geographic location. This enables the model to use the value of services as incentives for payments over volume, which is currently the basis for payments to entities and physicians that offer radiotherapy services. Such incentives according to CMS do not always fit what is clinically appropriate for beneficiaries, such as in cases that require a shorter course of radiation therapy treatment with more radiation per fraction.

In its own statement, the ACR echoed ASTRO's call to delay implementation of the rule. "Despite recommendations from ASTRO and the ACR to allow providers at least six months from the publication of the final rule to implementation due to the impacts of the COVID-19 public health emergency, CMS’ final rule only allows providers three and a half months to prepare for implementation," it wrote.

CMS did not respond for comment.

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