Market access update
Market access update
To address these challenges, the Centers for Medicare and Medicaid (CMS) has announced an evolution of the 2015 Oncology Care Model (OCM) with the Enhancing Oncology Model (EOM). The EOM is a new payment model “intended to transform care for cancer patients, reduce spending, and improve quality of care.”1
“The EOM is a voluntary, 6-month, total cost of care episodic payment model that, like OCM, focuses on beneficiaries with cancer who receive chemotherapy,” reports Milena Sullivan, Managing Director at Avalere.
“The EOM builds on the structure and learnings of the OCM but does not incorporate the foray into prospective bundles floated under the Oncology Care First proposal. The CMS Innovation Center (CMMI) leadership is laudably prioritizing health equity, but participants will need to balance between new responsibilities and more aggressive financial risk.”
“The new model will have a variety of implications for industry stakeholders” said Shalini Parekh, Principal at Avalere. “With participants assuming risk immediately while also receiving lower enhanced services payments per beneficiary, providers will likely face increased pressure to reduce the total cost of care under the EOM. Manufacturers should determine how the EOM may impact access to higher-cost regimens and formulate tailored value messaging strategies for engagement with providers.”
“While the new EOM maintains fee-for-service payments and drug reimbursement based on Average Sales Price, it lowers the monthly enhanced oncology services (MEOS) payment and moves providers into 1 of 2 different downside-risk arrangements. In addition to looking at clinical efficacy and safety when evaluating drug regimens, providers will need to have good visibility into their drug spend and payer mix. Life sciences companies will have to understand these considerations, and how they vary by provider segment and site of care,” explained Omar Hafez, Managing Director at Avalere.
“With the EOM maintaining its anchor point to a 6-month episode, the ability for this model to assess how patients respond and the differential costs associated with care for patients who respond to innovative therapy and management remains unanswered,” said Lance Grady, Practice Director at Avalere. “Certainly, costs in the first 6 months of care do not always equate to costs in a subsequent 6-month period. As such, this brings the calculation of the value of a therapy or regimen into question.”
Regarding the payer impact, Grady said: “Oncologists continue to lead in advancing innovative value-based payment arrangements and in many instances often shape how risk-based commercial contracts with payers are established. CMMI attempting to extend an all-payer model in the market could perhaps be more easily accomplished via the EOM than other models.”
The US team at PRMA Consulting has in-depth experience and thought leadership in oncology market access, HEOR, RWE, and policy solutions for clients commercializing oncology assets, from early-stage development to pre-launch and beyond.
If you have a question about how these new EOM policy changes might impact your product development and launch preparations, please contact us for an informal chat.
1. “Enhancing Oncology Model” An update from the Centers for Medicare & Medicaid Services.
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