Value-Based Care With Two-Sided Risk a Preference in Upcoming Oncology Care Model

Bo Gamble

Oncology practices that are participating in the Centers for Medicare & Medicaid Innovation’s Oncology Care Model (OCM) are willing to take on two-sided risk with value-based care and shift from a fee-for-service approach, according to results of a survey conducted by the Community Oncology Alliance (COA).

Findings showed that 47.1% of practices chose to remain in the OCM with one-sided risk, 36.8% chose to remain and enter into two-sided risk, 32.4% of those practices chose two-sided risk and had not received a single performance-based payment, and 16% said they were receding from the OCM.

Moreover, 10 of the 11 practices leaving the OCM had not received a performance-based payment over the previous 4 performance periods, and 1 practice received at least 1 performance-based payment but opted to leave the OCM.

“The last 3.5 years have done much to educate and prepare teams for new models for cancer care,” Bo Gamble, director of initiatives of COA, stated in a press release. “No longer are incentives purely about utilization. Now, there are numerous attempts to design a model with emphasis on quality, value, and meaningful quantifiable outcomes. The OCM, and the 20-plus other models, are consistent with that message.”

Participants who were a part of the OCM were surveyed between December 4 and December 20, 2019. In the survey, practices had to decide whether to continue in the OCM program, as well as to commit to a two-sided risk going forward. Sixty-eight OCM practices responded to the survey.

After the deadline, only OCM teams that had received at least 1 performance-based payment (out of a possible 4) could remain in the OCM without accepting two-sided risk. Those who chose to remain in the OCM had to decide between one- or two-sided risk. Additionally, practices that chose or were assigned two-sided risk would have to pay back Medicare if they did not achieve the required cost savings. Practices that have not received a performance-based payment, but wanted to remain in the OCM, were required to enter a two-sided risk agreement.

“We believe we will be forced into two-sided by 2025, and this is a low-risk entry into a two-sided model for our practice,” a participant had stated in the survey. “Entering into two-sided risk will re-energize our physicians and practice to take things to the next level for success. We were already successful in the model and this could make us even more successful.”

A total 679 physicians chose to remain in the OCM and take on two-sided risk. The average practice size taking on two-sided risk has 29.5 physicians, and the largest practice taking on two-sided risk has 160 physicians versus the smallest practice of 2 physicians.

Approximately 4.4% of practices achieved a performance-based payment during the previous 4 performance periods and chose the two-sided risk arrangement. A total 32.4% of practices had not received any performance-based payments but chose to remain in the OCM and take on two-sided risk.

The Centers for Medicare and Medicaid Services (CMS) also introduced the “safe zone,” which is used when a practice’s costs fall between the OCM’s targeted and benchmark costs. The practice does not earn a performance-based payment, but it is also not responsible for any costs surpassing the target amount. Through this, the practice does not owe money to the CMS.

In the survey, COA also brought up reinsurance to participants. Twenty-four percent of practices taking on two-sided risk said they would purchase reinsurance, 68% of them said they would not obtain reinsurance, and 2 were undecided. One practice said it may withdraw from the OCM if it is unable to obtain reinsurance.

Moreover, the average practice size that is purchasing reinsurance, which is 17 physicians, is smaller than the average practice size opting for two-sided risk.

“This suggests the smaller practices have more to lose if they do not do well and therefore need some financial security,” concluded Gamble in the press release.

COA survey finds OCM participants willing to take on two-sided risk [news release]: Washington, D.C. Community Oncology Alliance. Published January 30, 2020. https://bit.ly/2UhHIOC. Accessed February 3, 2020.