The Oncology Care Model and Two-Sided Risk: Make an Informed Decision

Later this month, the Centers for Medicare & Medicaid Services (CMS) will distribute Performance Period 4 (PP4) reconciliation reports for providers in Oncology Care Model (OCM). For the 175 practices participating in OCM, reconciliation reports are the moment of truth for each performance period in value-based payment programs. These reports reveal whether or not providers have beat their target prices and earned a Performance-Based Payment (PBP).

But, PP4 isn’t all about the potential to bring in more revenue. Participants’ PP4 performance will bear much weight in determining whether they will be required to take downside risk to remain in the program moving forward.  

The Impact of PP4 Reconciliation Reports

The five-year OCM program kicked off in July 2016 with an upside-only risk arrangement. Participants have thus far been rewarded with a PBP for providing quality care and staying within the bundle pricing target set by CMS, but were not required to be financially responsible for exceeding it. The option to take two-sided risk first became available in 2017.

For participants that haven’t yet earned a PBP, the fourth performance period was the final opportunity before two-sided risk becomes mandatory. Practices that have not made money as of the PP4 reconciliation report must enter a two-sided risk arrangement or leave the OCM program by October 3, 2019. Practices that have earned at least one PBP by PP4 can still choose to stay in the upside-only risk arrangement, though they can opt for the opportunity to earn more upside by adding downside risk in Performance Period 8, when it begins in January 2020.

The Benefits of Taking Risk

While downside risk may seem a daunting prospect, there are benefits that may help practices move forward confidently. Two-sided risk provides practices the ability to: 

  • Qualify for the 5% Advanced Alternative Payment Model (AAPM) bonus

  • Avoid Merit-based Incentive Payment System (MIPS) requirements

  • Increase potential upside with lower OCM discount of 2.5% or 2.75% instead of 4% in upside-only risk arrangement

  • Get ahead of CMS’ risk transference and shift to exclusively value-based payment programs 

Making an Informed Decision

Many practices in OCM, including some of those now obligated to take downside, are well-suited to move forward with two-sided risk on October 3. Archway encourages OCM participants to evaluate their options and make an informed participation decision:

  • Weigh the pros and cons unique to your organization

  • Quantify the potential AAPM bonus

  • Consider downside loss protection

How Archway Can Help

Archway’s value-based analytics team is available to help participants analyze performance and collaborate on a recommendation for how to proceed in Period 8.

Our team is also helping practices determine their ability to protect against downside risk based on their risk tolerance and performance trends. For practices taking on downside risk, voluntarily or not, Archway offers stop-loss insurance through a partnership with an A-rated carrier. We price based on predictable value-based care data and unique national provider data sources. The result is more accurate and realistic premiums for downside protection.

We’re here to ensure that providers in the Oncology Care Model are equipped to maximize their upside opportunity, and minimize their risk of loss, in order to succeed in value-based payment programs.

 

For help evaluating your OCM PP4 performance, contact Mike Fazio at mfazio@archwayha.com.

For information on value-based risk protection, contact Vince Micucci at vmicucci@archwayha.com.