American Oncology Network (AON) has withdrawn from the CMS Innovation Center’s Enhancing Oncology Model (EOM), citing opaque benchmarks, delayed payments, and shifting rules. Stephen “Fred” Divers, MD, Chief Medical Officer of AON, explained the decision during a podcast appearance with Navista’s Dr. Lalan Wilfong. The network, which operates across roughly 21 states with about 400 providers, initially viewed the model as executable given its experience with the earlier Oncology Care Model (OCM). However, the EOM required practices to accept downside risk and enroll before seeing their benchmarks. The Inflation Reduction Act subsequently altered model performance requirements after enrollment.
Financial and Operational Barriers
Divers described the payment lag as a behavioral economics problem. When rewards arrive 12 to 18 months after the work is done, it becomes difficult to maintain engagement across a large network or convince finance leaders to forgo short-term revenue. Navigation and other unreimbursed services built on OCM’s per-member-per-month payments now run at a loss. Tension was also high around 505(b)(2) drugs, which carry separate J-codes. These drugs generate immediate buy-and-bill margins but raise costs in a value-based framework where cheaper alternatives exist. AON implemented separate workflows and relied on pharmacy and therapeutics committees to balance practice finances against model performance without restricting patient access.
Practices that were already performing well often received tougher benchmarks. Variables like trend factors, novel therapy adjusters, radioligand therapies, and a single disease state such as myeloma in one performance period could swing results. Appeals added months to the process. As participation dwindled and CMS signaled limited resources behind the model, AON exited. Other payers did not follow Medicare’s lead because they were already benefiting from AON’s care approach. The network has since shifted to other value-based arrangements with payers and intermediaries that offer greater clarity.
These new deals aim to capture outcomes and quality alongside cost, remove pain points like prior authorization, and rely on real-time data. Divers noted that the EOM never delivered this kind of responsiveness. Future models should not penalize the early adoption of novel therapies, he advised, and practices should stay willing to pivot. “You can’t be right all the time, but we want to show continuous, steady improvement,” Divers said.