Why Radiation Oncology Needs an APM

Anne Hubbard
Published: Friday, Nov 03, 2017
The handwriting is on the wall: alternative payment models (APMs) are the future of Medicare payment.

In April 2015, the Medicare and CHIP Reauthorization Act (MACRA) was enacted. It effectively replaced the flawed Sustainable Growth Rate with the Quality Payment Program (QPP), which is designed to transition from the current fee-for-services system to one based on value and quality performance. MACRA was a bipartisan effort and enjoyed broad support by members of Congress, including then-Rep. Thomas Price (R, Georgia), who now serves as the Secretary of the US Department of Health & Human Services (HHS).

QPP involves 2 tracks: the Merit-based Incentive Payment System (MIPS) and APMs. Although many physicians will participate in the MIPS program at the outset of QPP, MACRA was designed to move as many physicians as possible into APMs.

An APM is a payment model that requires physicians to take responsibility for cost and quality performance and receive payments for providing high-value care, defined as high quality at a low cost. APMs are designed to drive down costs by making physicians financially accountable for costs of care. APMs also improve care through the application of quality measures. In return for their participation in advanced APMs and the additional risk involved, clinicians will receive a 5% increase in payment. In addition, after the initial years of QPP, practices participating in APMs will see higher payment increases than those who remain in MIPS.

Why Does Radiation Oncology Need an APM?

The American Cancer Society estimates there were 1.7 million new cancer cases in 2016.1 Of those, 250,000 patients were diagnosed with breast cancer; 225,000, lung cancer; 181,000, prostate cancer; 95,000, colorectal cancer; and 72,100, head and neck cancer. An unpublished, Medicare Surveillance, Epidemiology, and End Results (SEER) data analysis indicates that, of the Medicare patients receiving radiation therapy, 83% had 1 of these 5 primary disease types, accounting for 93% of total Medicare spending on radiation therapy services between 2007 and 2011 Radiation oncology clinics have experienced significant reductions in payment over the past decade. The pinch has been felt in both freestanding and hospital-based settings, with threats of further cuts on the horizon.

Freestanding radiation oncology clinics experienced Medicare payment cuts of approximately 20% from 2008 to 2015. Hospital-based facilities continue to see declines as the Comprehensive Ambulatory Payment Classification system expands, bundling more services and reimbursing them at lower rates.

In 2015, the American Society for Radiation Oncology (ASTRO) worked with Congress to pass the bipartisan Patient Access and Medicare Protection Act (PAMPA), which brought much-needed payment stability to freestanding radiation oncology clinics. The resulting freeze on rates is set to expire January 1, 2019, and ASTRO is strenuously lobbying CMS and Congress to ensure no further payment cuts.

At the same time, ASTRO has formulated a Radiation Oncology APM (ROAPM) that we believe meets MACRA requirements and provides radiation oncologists with an opportunity to meaningfully participate in an APM.

An APM for Radiation Oncologists

The RO-APM is designed to protect access to care and improve the quality of care for patients with cancer. For practices, this model will help stabilize payment rates for a 5-year period.Without it, many eligible radiation oncologists would be relegated to participating in the MIPS program, which could lead to more significant cuts in payment over time.

The RO-APM establishes episode-based payments according to a practice’s historical payment rates, as well as regional and national averages. The resulting base rate is fixed for 5 years and enables participants to secure a 5% bonus for participation under QPP, an added incentive for delivering efficient, high-quality care.

The RO-APM provides radiation oncologists an alternative to the Oncology Care Model–currently the only oncology care advanced APM eligible for bonuses—and was developed in collaboration with other radiation oncology stakeholder groups. Its features:
  • Adherence to existing radiation oncology clinical practice guidelines to reduce waste and unnecessary care, resulting in better patient outcomes and lower costs
  • Application of a common episode-based payment framework applicable to each of 7 disease types: breast, lung, prostate, colorectal, head and neck, brain metastases, and bone metastases
  • Establishment of shared savings for meeting meaningful, relevant quality benchmarks
  • Incentives to deliver the most appropriate care, regardless of modality and payment levels

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