The Oncology Care Model: Evaluating a Decade of Value-Based Cancer Care

The Centers for Medicare & Medicaid Services (CMS) concluded the Oncology Care Model (OCM) in 2022, a five-year pilot program that aimed to reduce Medicare spending while improving the quality of cancer treatment. Although the program resulted in a net decrease in total Medicare spending of approximately $482 million, this was offset by $529 million in performance-based payments to participating practices, leading to a net loss for the agency. Despite the fiscal outcome, the model established a foundational framework for value-based oncology, shifting the focus from fee-for-service medicine toward coordinated, patient-centered care.

What was the Oncology Care Model?

Launched in 2016 by the CMS Innovation Center, the OCM was a voluntary program designed to test whether providing financial incentives for high-quality, coordinated care could lower costs for beneficiaries undergoing chemotherapy. According to the official CMS program summary, participating practices received two types of payments: a monthly Enhanced Oncology Services (EOS) payment for each patient and the opportunity to earn performance-based payments for reducing costs below established benchmarks.

The model required participating clinics to provide 24/7 access to clinicians, utilize patient navigators, and adhere to evidence-based clinical guidelines. By formalizing these requirements, the OCM moved oncology practices toward standardized care pathways, a significant departure from the traditional volume-based reimbursement model.

Did the OCM reduce healthcare costs?

Financial results from the OCM were mixed. An evaluation by Abt Associates, commissioned by CMS, found that while the OCM successfully reduced hospitalizations and emergency department visits, the cost savings were not sufficient to cover the administrative and performance-based payments made to participating practices.

The following table illustrates the financial impact of the model over its duration:

While the program did not achieve net savings for Medicare, proponents argue that the investment served as a necessary “tuition” for the industry. The model forced practices to invest in infrastructure—such as electronic health record optimization and nursing staff for care coordination—that remains in place today.

Why did the program end?

The OCM concluded as planned in June 2022. The CMS transition reflects a broader shift toward the Enhancing Oncology Model (EOM), which launched in July 2023. The EOM refines the OCM’s approach by focusing on specific cancer types, mandating the reporting of social determinants of health, and requiring more rigorous monitoring of patient-reported outcomes.

The transition highlights a key lesson learned from the OCM: scaling value-based care requires more granular data. By narrowing the scope to specific cancers, the EOM aims to address the complexity of modern immunotherapy and targeted treatments that were less prevalent when the OCM was designed in 2015.

What are the lasting impacts on oncology practice?

Beyond the balance sheet, the OCM transformed clinical workflows. According to the Community Oncology Alliance, the model empowered independent practices to formalize “care coordination,” a service that was rarely reimbursed under traditional fee-for-service arrangements.

• Standardized Care: Practices adopted evidence-based guidelines, reducing unnecessary diagnostic testing.
• Patient Navigation: Dedicated staff roles were created to assist patients with financial counseling and symptom management.
• Data Infrastructure: Clinics upgraded their analytical capabilities to track patient outcomes and cost metrics in real-time.

The legacy of the OCM lies in its proof of concept: oncology practices demonstrated that they could manage the total cost of care without compromising clinical outcomes. As the healthcare system continues to prioritize value over volume, the operational lessons from this decade-long experiment remain the blueprint for future initiatives.