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8 takeaways for cancer programs from Medicare's 2023 final rules

By Lindsey PaulAshley Riley

November 10, 2022

Last week, CMS released the Calendar Year (CY) 2023 Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System final rule and the 2023 Medicare Physician Fee Schedule final rule. Here we've summarized the most important implications for cancer programs, along with one takeaway you might have missed from the Inflation Reduction Act.

2023 OPPS/ASC final rule

1. The 340B payment rate is increasing to ASP +6%

Though CMS initially proposed to continue the payment rate of ASP -22.5% for 340B-acquired drugs for CY 2023, the agency raised the rate to ASP +6% in final rule. This announcement comes after the Supreme Court's recent decision in American Hospital Association v. Becerra to invalidate the 340B payment reduction to ASP-22.5% that CMS implemented back in 2018. In the ruling, the Supreme Court said the payment reduction was illegal because CMS did not survey hospitals to determine their average drug acquisition costs.

This is a win for hospitals participating in the 340B program that will see nearly $2 billion in additional revenue from cancer and other drug reimbursement. However, to achieve budget neutrality, CMS had to reduce the payment rates for non-drug services by 3.09%, which will affect both 340B and non-340B hospitals.

2. Modified radical mastectomy and lymph node biopsy or excision are being added to the ASC Covered Procedures List (CPL)

Through its analysis of the procedures and consultations with stakeholders and clinical advisors, CMS determined that modified radical mastectomy (including axillary lymph nodes but excluding the pectoralis major muscle) and biopsy or excision of the lymph node(s) can both be safely performed in the ASC setting.

CMS initially proposed that only lymph node biopsy or excision be included on the CPL but added modified radical mastectomy in the final rule after receiving the recommendation from commentators. While the addition to the CPL means that these procedures can be conducted in the ASC setting, it doesn't mean they have to be.

It'll be interesting to see to what extent these procedures shift to the ASC setting in coming years. CMS noted that adding these procedures to the CPL can free up hospital capacity and promote site neutrality.

3. The new Breast Cancer Screening Recall Rates OQR measure (OP-39) reporting period starts in CY 2023

The three-year reporting period for the Hospital Outpatient Quality Reporting (OQR) Program's new Breast Cancer Screening Recall Rates OQR measure (OP-39), which was finalized last year, starts in CY 2023.

This is a claims-based measure, so providers don't have to report any specific data for this measure. It's calculated at the facility level as the percentage of screening mammography and digital breast tomosynthesis (DBT) studies that are followed by a diagnostic mammography, diagnostic DBT, breast ultrasound, or breast MRI study performed in an outpatient or office setting on the same day or within 45 days. There is no financial penalty for facilities performing outside the target recall rate range of 5-12%.

2023 MPFS final rule

1. Hematology/oncology and radiation oncology payments are being cut

Payments to both hematology/oncology and radiation oncology physicians are expected to decrease by 1% in 2023 due to RVU changes. For hematology/oncology, this is because of changes in the practice expense (PE) RVUs, while the radiation oncology impact can be attributed to work RVU changes.

The impact on oncologists may be exacerbated by the concurrent end of the temporary 3% increase in payments that physicians saw in 2022 to help mitigate the impact of the pandemic.

2. CMS is launching a new, oncology-specific MIPS Value Pathway (MVP) called Advancing Cancer Care

The voluntary Advancing Cancer Care MVP focuses on providing fundamental treatment and management of cancer care and is aimed at oncology and hematology clinicians. It includes 10 cancer-related quality measures and two Qualified Clinical Data Registry measures that focus on patient experience, end-of-life care, and appropriate diagnosis and treatment. It also includes 13 improvement activities and a Total Per Capita Cost measure.

There is some overlap in the improvement activities of the Advancing Cancer Care MVP and the requirements of CMS' new Enhancing Oncology Model (EOM), such as guideline-concordant treatment, 24/7 access to clinicians, and advanced care planning. It's also likely that there will be overlap between the quality measures for the two programs, since we know the EOM quality measures will focus on patient experience, management of end-of-life care, and other similar areas.

For cancer programs, the Advancing Cancer Care MVP is an opportunity to participate in MVP reporting, where CMS says it's headed in the long-term, rather than reporting through traditional MIPS. It also provides quality reporting and care transformation experience that could help clinicians prepare for participation in alternative payment models, like the EOM, without having to take on financial risk.

Cancer programs will need to decide whether it makes most sense for their organization to participate in the Advancing Cancer Care MVP, the EOM, or traditional MIPS reporting. They should compare the respective requirements, financial implications, and other potential participation benefits (e.g., access to data) of each program before deciding which one to move forward with.

3. CMS is expanding Medicare coverage for colorectal cancer screening

In accordance with a recommendation by the U.S. Preventive Services Task Force (USPSTF), CMS is lowering the minimum age at which it will cover certain colorectal cancer screening tests from 50 to 45 starting in CY 2023. Covered screening tests include barium enema tests and blood-based tests not recommended by the USPSTF.

CMS is also considering colonoscopies conducted after positive non-invasive stool-based screening tests to be screening tests rather than diagnostic tests or treatment, meaning beneficiaries won't have any cost-sharing responsibilities. These policies will help more beneficiaries access screening, allow for earlier cancer detection and treatment, and reduce cancer mortality.

4. CMS finalized new cancer-related MIPS quality measures

CMS added new cancer-related MIPS quality measures for the CY 2023 performance period/2025 MIPS payment year. One of the new measures looks at how many colorectal, endometrial, gastroesophageal, and small bowel carcinoma patients have been tested for mismatch repair or microsatellite instability, one monitors whether patients taking checkpoint inhibitors have been prescribed medication for diarrhea or colitis, and one tracks screening for social drivers of health.

The agency also added screening for depression and follow-up plan, use of high-risk medications in older adults, CAHPS for MIPS clinician/group survey, and adult immunization status measures to the Oncology/Hematology Specialty Set and a tobacco screening and cessation intervention measure to the Radiation Oncology Specialty Set.

Lastly, CMS removed individual immunization and vaccination measures and a measure of cancer patients who received ICU care in the last 30 days of life, as it was difficult for providers to retrieve ICU data.

The Inflation Reduction Act

1. CMS is raising reimbursement for biosimilars

The Inflation Reduction Act, passed in August 2022, raised the add-on fee for biosimilars from 6% to 8% through December 2027 in attempt to encourage competition and lower drug spending. As a result, cancer programs can expect to see increased reimbursement for biosimilars.

To learn more about how the Inflation Reduction Act will impact oncology stakeholders, check out our recent blog post

For more information on the final payment updates, read Advisory Board’s Daily Briefing article on the 2023 MPFS and OPPS final rules.

2022 Oncology State of the Union


While the pandemic has had very real—and at times painful—consequences already, many of the decisions that will shape the future of oncology have yet to be made.

View the recorded 2022 Oncology State of the Union, which took place on June 7, where we examined the most important strategic questions facing oncology leaders across the industry during the peri-Covid-19 era and discussed which structural elements of the oncology landscape remain in flux, and what steps various oncology stakeholders can take to influence the direction and pace of change of those shifts.

Download now

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