First Evaluation Report of CMS’ Enhancing Oncology Model Shows Early Episode Payment Reduction, Net Loss to Medicare
Key Clinical Summary
- The Enhancing Oncology Model (EOM) Performance Period 1 (July-December 2023) evaluation found reduced total episode payments for 6-month oncology episodes, driven chiefly by lower Part B systemic therapy costs.
- Despite the payment reduction, after accounting for incentive and monthly enhanced oncology services (MEOS) payments, the model likely produced a net loss to Medicare in its first 6 months.
- Practices joining EOM tended to have prior value-based oncology experience (most had participated in the legacy Oncology Care Model (OCM), were community-based, located in the South, and had higher baseline episode volumes than non-participating practices.
The Centers for Medicare & Medicaid Services (CMS) and independent evaluators have released the first annual evaluation report of the Enhancing Oncology Model. The report, prepared by The Lewin Group in partnership with Westat and submitted in August 2025, assesses early impacts of the EOM payment model for Medicare-fee-for-service (FFS) beneficiaries receiving systemic therapy for 7 high-risk cancers.
Study Findings
The EOM launched on July 1, 2023, covering 6-month episodes for Medicare FFS beneficiaries treated for high-risk breast cancer, chronic leukemia, small intestine/colorectal cancer, lung cancer, lymphoma, multiple myeloma, and high-risk prostate cancer.
Across the first performance period (episodes initiated July 1, 2023 through December 31, 2023), EOM practices showed measurable movement. The evaluation team reports that total episode payments declined, and the drop was principally tied to decreases in Part B systemic cancer therapy drug spending.
Systemic therapy drugs accounted for about 58% of episode costs and participating practices emphasized value-based pharmacy interventions (eg, alternative dosing or regimen choices) and reducing avoidable acute care utilization.
However, when CMS factored in the MEOS payments (monthly per-beneficiary payments to practices for care transformation) and incentive payments to participants, the net result for Medicare in that first six-month performance period was likely a net loss, albeit with a range of uncertainty that includes the possibility of savings.
The report also found that of the 44 initial participating oncology practices, 31 had been in the earlier OCM model. Participating practices had nearly 3 times the number of oncology practitioners and almost 4 times the episode volume as non-participating practices, and were more commonly community-based and located in the Southern US.
Clinical Implications
For oncology leaders, clinicians, and payers tailoring clinical pathways, the early EOM results carry important lessons. The reduction in systemic therapy costs indicates that value-based strategies (eg, regimen optimization, dose modification, biosimilar adoption) may have traction under episode-based payment models. The fact that practices focused on pharmacy interventions highlights the leverage point of high-cost drug spend in oncology episodes.
However, the net loss to Medicare suggests that cost savings from reduced therapy spend did not yet offset the upfront investments incentivized by the model (MEOS payments and incentives). For pathway developers, this signals that while drug cost containment is a core element, broader cost drivers—such as acute care utilization, hospital admissions, social-needs support and patient navigation—may need stronger focus or longer time horizon to yield net savings.
Moreover, the selective participation of higher-volume, value-based experienced practices raises questions about generalizability as smaller or less experienced practices may face steeper transformation barriers. For payers and pathway governance, these findings point to the need for realistic benchmarking, attention to upfront investment in redesign activities (ePROs, social needs screening, navigation), and ongoing monitoring of both cost and quality. The fact that acute-care avoidance strategies were reported but not yet clearly translated into savings also suggests that pathway design should emphasize whole-patient coordination beyond drug spend alone.
Conclusion
The first evaluation of the EOM reveals promising reductions in systemic therapy costs for high-risk cancer episodes but underscores that early cost cuts have not yet translated into net savings for Medicare. Oncology pathway stakeholders should monitor forthcoming performance periods, refine pathway design to engage whole-patient care, and align incentives accordingly as the EOM evolves through 2030.
Reference
Henke R, Castro J, Chan A. The Enhancing Oncology Model First Annual Evaluation Report. The Lewin Group, Inc. August 2025. Accessed November 18, 2025. https://www.cms.gov/priorities/innovation/data-and-reports/2025/eom-1st-eval-report
