On June 30, 2022, the Centers for Medicare & Medicaid Services (CMS) released a proposed regulation establishing the Conditions of Participation (CoPs) for a new hospital provider type, Rural Emergency Hospitals (REHs). The REH concept was first developed by the Medicare Payment Advisory Commission (MedPAC) and subsequently mandated by Congress through the Consolidated Appropriations Act (CAA) of 2021 to address the growing concern over closures of rural hospitals.

REHs provide an opportunity for Critical Access Hospitals (CAHs) and rural hospitals to improve the way care is delivered in their communities, maintain access, and avert potential closure by choosing to focus on the service offerings that are most essential to their communities, such as emergency services, observation care, and additional medical, behavioral, and maternal outpatient services. Importantly, the REH concept enables facilities to maintain a hospital designation absent inpatient capacity thereby ensuring that rural communities retain access to services. This proposed regulation is a significant milestone in CMS’ work to implement the REH designation and their novel payment methodology by their mandated start date of January 1, 2023.

The REH concept is expected to help address the observed health inequities that arise when rural communities lack access to hospitals and other providers. Obtaining an REH designation could be an opportunity for many independent hospitals and delivery systems to strategically reshape themselves in line with their community’s needs while receiving payments from Medicare for doing so.

Within CMS’ proposed regulation, the agency proposes to establish a novel set of REH CoPs which will define the parameters of the REH designation. The REH CoPs closely align with the current CAH CoPs in most cases, while considering the uniqueness of REHs and the statutory requirements. In some instances, the proposed REH policies closely align to the current hospital and ambulatory surgical center standards, such as the polices for outpatient services’ requirements and life safety code, respectively.

As a part of this proposed regulation, CMS seeks input from the rural community on a few key aspects of the REH designation, including:

• The specific proposed REH standards, including the ability of an REH to provide low-risk childbirth-related labor and delivery services and whether the agency should require REHs to provide outpatient surgical services in the event that surgical labor and delivery intervention is necessary.
• Whether it is appropriate for an REH to allow a physician, physician assistant, nurse practitioner, or clinical nurse specialist, with training or experience in emergency medicine, to be on call and immediately available by telephone or radio contact and available on site within specified timeframes.

Updates to CoPs for Critical Access Hospitals

Also within this draft regulation CMS proposes to update the CoPs for CAHs by: (1) adding a definition of primary roads to the location and distance requirements; (2) establishing a patient’s rights CoP; and (3) allowing CAHs that are a part of a larger health system (containing other hospitals and/or CAHs) to unify and integrate their infection control and prevention and antibiotic stewardship programs, medical staff, and quality assessment and performance improvement programs (known as QAPI) to ensure consistent and safe care.

What’s Next

CMS is accepting comments on this rule until August 29, 2022. CMS intends to propose additional policies related to Medicare enrollment, payment, and quality reporting in the upcoming Calendar Year 2023 Outpatient Prospective Payment System/Ambulatory Surgery Center proposed rule. CMS will develop final policies for this program later this year.

For more information about this proposed regulation including how to submit comments and how the REH concept may impact the hospital industry and patients in rural communities please contact our Medicare team who have knowledge in Congressional, MedPAC and CMS policy and operations – Zach Gaumer (HMA Principal) (zgaumer@healthmanagement.com), Amy Bassano (HMA Managing Director, lMedicare) (abassano@healthmanagement.com), or Andrea Maresca (HMA Principal) (amaresca@healthmanagement.com). To access CMS’s proposed Rural Emergency Hospital and Critical Access Hospital Conditions of Participation, visit: https://www.federalregister.gov/public-inspection/current.

This week, our In Focus section reviews the new Center for Medicare and Medicaid Innovation (CMMI) model named the Enhancing Oncology Model (EOM), released on June 27, 2022, by the Centers for Medicare & Medicaid Services (CMS). This new physician specialty model builds off the previously implemented Oncology Care Model (OCM). The EOM incentivizes the coordination of care and the improvement of care quality for Medicare patients undergoing cancer treatment. The model also seeks to reduce Medicare fee-for-service spending for oncology services, because oncology services are an area of high spending within the Medicare program. As a part of the EOM model participating physician practices will be held accountable for financial and performance targets during six-month episodes of care for systemic chemotherapy administration to patients with common cancer types. The EOM will run for five years beginning on July 1, 2023. Applications to EOM are currently open and will close on September 30, 2022.

CMS indicated that EOM supports President Biden’s Cancer Moonshot initiative to improve the experience of people and their families living with and surviving cancer. EOM aligns with the Cancer Moonshot pillars and priorities of supporting patients, caregivers, and survivors, learning from all patients, targeting the right treatments for the right patients, and addressing inequities.

Consistent with CMS priorities, EOM also has a strong health equity focus and oncology practices who care for underserved beneficiaries are encouraged to apply.

Design of EOM

EOM is built off the foundation of OCM which ran from July 1, 2016, through June 30, 2022. CMS previously solicited feedback from the oncology community and other interested stakeholders on an OCM successor model. Those lessons plus an alignment with CMMI’s strategy refresh priorities of moving to total cost of care accountable models and making cancer care more affordable and accessible created the foundations for the design of the model.

Under EOM, participating Physician Group Practices (PGPs) will take on accountability for their patients’ health care quality and for total Medicare Parts A and B and certain Part D spending during six-month episodes of care.  Eligible Medicare patients are those with certain cancers (breast cancer, chronic leukemia, small intestine/colorectal cancer, lung cancer, lymphoma, multiple myeloma, and prostate cancer) receiving chemotherapy treatment.

• Participating practices may bill for a Monthly Enhanced Oncology Services (MEOS) ($70 per month) payment for Enhanced Services provided to eligible beneficiaries. The MEOS payment will be higher ($100 per month) for beneficiaries dually eligible for Medicare and Medicaid.
• Enhanced services are
  • Provide EOM beneficiaries 24/7 access to an appropriate clinician who has real-time access to the EOM participant’s medical records.
  • Provide patient navigation, as appropriate, to EOM beneficiaries
  • Document a care plan for each EOM beneficiary that contains the 13 components in the Institute of Medicine (IOM) Care Management Plan applicable to the EOM beneficiary
  • Treat EOM beneficiaries with therapies in a manner consistent with nationally recognized guidelines
  • Identify EOM beneficiary social needs using a health-related social needs screening tool
  • Gradual implementation of electronic Patient Reported Outcomes (ePROs)
• Participants will be required to take on downside financial risk from the start of the model (with the potential to owe CMS a performance-based recoupment). If participants successfully meet quality and savings targets, they will have the opportunity to earn a retrospective performance-based payment (PBP). These amounts will be based on actual practice performance.
• CMS has not yet specified the quality measures for this model. Instead, the application says the EOM quality strategy will focus on the following domains: patient experience, avoidable acute care utilization, management of symptoms toxicity, management of psychosocial health, and management of end-of-life care. CMS will prioritize measures that; reflect national priorities for quality improvement and patient-centered care, are outcomes-based measures (including those collected from patients), minimize EOM participant burden where possible, and align with CMS and Innovation Center quality strategy.
• Health equity provisions of the EOM include requiring oncology practices to screen for health-related social needs (HRSNs), CMS providing data reports on patient expenditures and utilization for to help health care professionals identify and address health disparities, and CMS increasing reimbursement for the provision of Enhanced Services to patients who are dually eligible for Medicare and Medicaid.
• CMS also will issue payment waivers and benefit enhancements to provide additional flexibility to practices in the way they deliver care to patients. Expected enhancements include telehealth, post-discharge enhancements, and care management home visits.

CMS has designed EOM as a multi-payer model. Medicare Advantage plans, state Medicaid plans and other payers are invited to apply to enter into a Memorandum of Understanding with CMS to align on incentives for oncologists to improve care to their patients and increase participation in value-based care arrangements.

What’s Next

CMS intends to release additional information about EOM payment methodologies later this summer. CMS also will be hosting several upcoming webinars regarding the payment methodology, quality strategy and general application support office hours before the application due date of September 30, 2022. CMS intends to select participants later this year or early next year and will implement the EOM on July 1, 2023.

For more information about this new model and how providers and payers can apply to it, please contact our Medicare team who have knowledge in CMS and its value-based payment programs, Amy Bassano (HMA Managing Director, Medicare) (abassano@healthmanagement.com), Julie Faulhaber (HMA Managing Director, Medicare) ( jfaulhaber@healthmanagment.com) Andrea Maresca (HMA Principal) (amaresca@healthmanagement.com), or Zach Gaumer (HMA Principal) (zgaumer@healthmanagement.com). To access the EOM application and other model materials, you may visit https://innovation.cms.gov/innovation-models/enhancing-oncology-model.