Publication

The Centers for Medicare and Medicaid Services (CMS) has recently reiterated its commitment to transition more providers to two-sided risk alternative payment models (APMs). Ever mindful of CMS’s direction and leadership in payment reform, oncologists and commercial payers developing their own APMs in oncology are increasingly focused on the role of risk in incenting a shift to value-oriented care without threatening practices’ financial viability. 

The question of whether and how much risk is needed for accountable care was top of mind for participants in the oncology APMs advisory council, which gathered in March 2019 in Washington, DC. The council serves as a platform for leading designers and implementers of oncology APMs to learn from one another and catalyze new thinking and approaches to improve pilots in this space. The broad issue of accountability in oncology care underlay other meeting topics. These included the need to meaningfully measure provider performance and inducing effective care delivery through use of clinical pathways, which are quality-focused treatment protocols for specific types and subtypes of cancer. 

During the meeting, participants considered the following questions:

• In two-sided risk models, can reinsurance  protect practices from catastrophic loss?

• How can outcomes-based quality measures be practically implemented?

• What is the near-term direction for clinical pathways in promoting effective, value-based care?

• What new APMs are being developed? And do they still matter in today’s dynamic policy environment? 

To address these questions, the council welcomed experts from Milliman and the Tufts Center for the Evaluation of Value and Risk in Health (CEVR) to share findings from new research on the value of reinsurance and outcome measures, respectively. At the time of the meeting, both pieces of research had not yet been published. Additionally, representatives of leading oncology guidance organizations discussed their organizations’ views on clinical pathways. Key takeaways from these conversations are as follows:

• Some types of reinsurance can protect practices from significant loss, but the business case is murky. Representatives from large and small practices agreed that because the analysis by Milliman suggested that the cost of reinsurance would result in a loss even in good years, there was likely little value to such products for individual providers. A minority noted that it could be worth exploring captive insurance pools, which could protect providers at a lower cost to individual practices. Finally, many were concerned at the model’s revelation that reinsurance could not prevent consistently understated financial targets in an APM from significantly reducing expected gains—and they therefore questioned the rationale for risk altogether. 

• Many outcome measures still face barriers in practical implementation. Participants proposed several revisions to a set of core outcome measures proposed in Tufts’ research. Provider representatives were concerned with measures that may encompass care decisions that are outside of the treating oncologist’s control, as well as the limited availability and interoperability of relevant data sources. Others proposed ways to streamline performance measurement across payers, such as examining how Medicare performance might correlate with performance in commercial populations. 

• Pathways have a valuable role to play in enhancing and streamlining the quality of medical care. While participants debated pathways’ ability to significantly reduce costs over the long term, all stakeholders present agreed that high-quality pathways have value. Some, however, proposed more granular compliance recommendations. These could help direct providers to regimens that should, based on the strength of the clinical evidence, be followed more than the often-quoted “80/20 rule, or where 20 percent of the time it is appropriate to go off-pathway.” Some regimens, participants noted, should be followed 95% of the time in cases where the standard of care is well established.

• APMs in this specialty are proliferating and are here to stay. Many APMs are being designed for oncology care in local or regional markets. Despite several policy proposals that may change the trajectory of drug pricing and provider reimbursement, participants affirmed that they expect APMs to continue to be a prominent part of the United States’ transformation to value-based care.

In light of these observations, the group offered several reflections on next steps for the council:

• On risk and reinsurance:

  • Publish the commissioned reinsurance analysis for the broader oncology community to better understand the benefits and drawbacks. 

  • Consider educating reinsurers on the specialty APM market to better define their role and what they can offer.

  • Explore further how much risk, if any, makes sense as part of new APM designs, and also explore other ways to manage it.

• Investigate further the extent to which Medicare data could be used as a proxy for overall provider performance, to improve quality measurement.

• Explore further how the council can support use of high-quality pathways, given participants’ agreement that pathways have value.

• Continue to collaborate as a group, share lessons, and identify opportunities to work with one another.