JANUARY 10, 2020

Welcome to the Bundled Payment Update eNewsletter
Editor: Philip L. Ronning
This issue is sponsored by the National ACO Summit, the National Bundled Payment Summit,
the National Medical Home Summit, the National MACRA MIPS/APM Summit,
and the National Medicare Advantage Summit

Data Sharing, Teamwork Essential to Pediatric Value-Based Care
Cooperation with providers and data sharing are key to success in pediatric value-based care, Horizon Blue Cross Blue Shield New Jersey (BCBSNJ)'s 2018 care quality results show. "Horizon and our provider partners are able to achieve better outcomes together because we freely exchange knowledge and expertise, and we share claims data and resources that help doctors better understand their patients and our members," Allen Karp, Horizon BCBSNJ's executive vice president for healthcare management and transformation, said in the press release. "We also all believe that by working together as a team, versus separately in silos, we have the best chance at delivering better care, a better patient experience and lowering costs for the patients we serve." In 2018, the payer invested over 60 percent of its medical care spending, or $100.8 million, in value-based arrangements. Specifically, the payer engaged in shared savings payments, where providers form accountable care organizations (ACOs) that are willing to take on financial risk based on patient outcomes. These arrangements are thought to cut costs and improve outcomes. Horizon BCBSNJ says it saw an improvement in one year alone due to these measures. In its value-based pediatric program, the payer increased immunizations by 11 percent. It saw a 21 percent rise in child well visits as well as a nine percent increase in weight counseling and monitoring visits. Moreover, the company's immunizations of two-year-olds were seven percent above the national average and 14 percent above the national average for adolescents. (HealthPayer Intelligence, January 2, 2020)

How Should We Pay for Cancer Care? Not This Way
In November, the Center for Medicare and Medicaid Innovation (CMMI) released the initial details of "Oncology Care First," its proposal for a new Alternative Payment Model (APM) for cancer care that would replace the current Oncology Care Model. Cancer patients and those who care about them should be worried, because if Oncology Care First is actually implemented, it could prevent cancer patients from receiving the treatments they need and cause community oncology practices to close.

Over the past three years, the CMMI Oncology Care Model (OCM) has helped many Medicare beneficiaries with cancer to receive better care by filling in a key gap in the Medicare fee-for-service system -- the lack of payment for care management services. Thanks to the significant new payments provided in OCM, nearly 200 oncology practices across the country have been able to provide greater support for their patients and to respond more quickly and effectively when patients experience side effects from their treatment so they don't need to go to an emergency department or be hospitalized.

But rather than building on that success by filling in additional gaps in fee-for-service payments, "Oncology Care First" would go in the exact opposite direction -- making cancer care worse by penalizing physicians for using new cancer treatments and paying them bonuses if they withhold the treatments that cancer patients need. Instead of fixing the problems in the methodology used in OCM for "performance-based payments," CMMI wants to use the same methodology in Oncology Care First to impose penalties on oncology practices that could force them out of the program or out of business entirely.

These problems are explained in more detail in A Better Way to Pay for Cancer Care: The Problems with CMS Oncology Payment Models and How to Create Patient-Centered Cancer Care Payment.

(Center for Healthcare Quality and Payment Reform, December 2019)

Medicare Oncology Care Model Needs Refinement to Boost Reach
Medicare's Oncology Care Model (OCM) is a promising start to payment reform for oncology care but the model needs several vital changes to improve the model's effectiveness and reach across providers and payers, according to a group of industry experts. In a new report, the workgroup convened by Remedy offered CMS five recommendations for improving the Oncology Care Model, a bundled payment arrangement for episodes of chemotherapy treatment. The model launched in 2016 and set to expire in 2021 has enabled 190 practices to develop care plans, coordinate care, and improve survivorship planning, and implement other patient-centered care capabilities. However, the model has yet to realize overall cost savings and measurable quality improvements, CMS reported in the latest evaluation report. (See Resource Section below.) The workgroup led by Remedy highlighted that OCM already accomplished a few goals thus far. For example, the model enabled accurate identification of most of the elements of cancer care management and introduced transparent pricing. Most importantly, the model also moved practices away from fee-for-service and toward value-based care. But the current episode definitions in the OCM are "highly constraining," which causes concerns for partnership and local commercial plans, the workgroup stated. Specifically, there are not many payers that have integrated the OCM model, which forces practices to make choices about transformation for all patients or just those in the OCM, the industry experts explained. Furthermore, just a few payers have decided to expand the model, and when they did, they focused on the upside-only payment models, which fails to meet the goal of shifting financial accountability to providers. (RevCycle Intelligence, December 19, 2019)

Spending And Quality After Three Years Of Medicare's Voluntary Bundled Payment For Joint Replacement Surgery

Medicare has reinforced its commitment to voluntary bundled payment by building upon the Bundled Payments for Care Improvement (BPCI) initiative via an ongoing successor program, the BPCI Advanced Model. Although lower extremity joint replacement (LEJR) is the highest-volume episode in both BPCI and BPCI Advanced, there is a paucity of independent evidence about its long-term impact on outcomes and about whether improvements vary by timing of participation or arise from patient selection rather than changes in clinical practice. We found that over three years, compared to no participation, participation in BPCI was associated with a 1.6 percent differential decrease in average LEJR episode spending with no differential changes in quality, driven by early participants. Patient selection accounted for 27 percent of episode savings. Our findings have important policy implications in view of BPCI Advanced and its two participation waves.

(Health Affairs, January 2020)

Business Case for Providing Patient Navigation Services in Cancer Care
This article reviews the successes of three oncology programs utilizing Patient Navigation (PN) strategies. Cancer is among the deadliest illnesses in the United States, according to the American Cancer Society. In 2017, ACS estimated there were 600,000 cancer deaths. Cancer also is among the costliest illnesses to treat. The Agency for Healthcare Research and Quality estimated total cancer treatment costs in 2015 were $80.2 billion.


  • The University of Alabama at Birmingham achieved lower care utilization rates for cancer patients such as hospitalizations through navigation services.
  • A North Carolina-based cancer institute lowered hospital readmission rates for cancer patients through navigation services.
  • HCA Healthcare's Sarah Cannon Cancer Institute posted patient loyalty gains through navigation services.

(HealthLeaders, January 2, 2020)

Patient Navigation in Cancer: The Business Case to Support Clinical Needs


PURPOSE: Patient navigation (PN) is an increasingly recognized element of high-quality, patient-centered cancer care, yet PN in many cancer programs is absent or limited, often because of concerns of extra cost without tangible financial benefits.

METHODS: Five real-world examples of PN programs are used to demonstrate that in the pure fee-for-service and the alternative payment model worlds of reimbursement, strong cases can be made to support the benefits of PN.

RESULTS: In three large programs, PN resulted in increased patient retention and increased physician loyalty within the cancer programs, leading to increased revenue. In addition, in two programs, PN was associated with a reduction in unnecessary resource utilization, such as emergency department visits and hospitalizations. PN also reduces burdens on oncology providers, potentially reducing burnout, errors, and costly staff turnover.

CONCLUSION: PN has resulted in improved patient outcomes and patient satisfaction and has important financial benefits for cancer programs in the fee-for-service and the alternative payment model worlds, lending support for more robust staffing of PN programs.

(American Society of Clinical Oncology, 2019)

Evaluation of the Oncology Care Model: Performance Period One

Bundled Payment Update e-Newsletter is one of a family of free e-Newsletters providing a complimentary video presentation and regularly updated news and key resources on major health care issues such as ACOs, patient safety, pay for performance, comparative effectiveness, readmissions, and Medicaid. To view and subscribe to other e-Newsletters go to www.HealthCareeNewsletters.com.

Case Study of BlueCross BlueShield of North Carolina's Value-based Payment Initiatives

James P. Sharp, MPH, JD
Director, Health Care Strategy and Transformation, BlueCross BlueShield of North Carolina; Former Policy and Strategy Advisor, Office of the Director, Center for Medicare and Medicaid Innovation, Washington, DC