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J Oncol Pract. 2006 January; 2(1): 25.
PMCID: PMC2794642

CMS Announces 2006 Medicare Oncology Demonstration Project

The Centers for Medicare & Medicaid Services (CMS) has announced a new 1-year, voluntary demonstration project for office-based oncologists, effective January 2006. CMS's intent in implementing the new demonstration is to (a) support care that has been shown to lead to better outcomes for patients with cancer, (b) determine how and whether oncology practices follow well-established evidence-based practice guidelines, and (c) associate reporting of quality by evaluating physician services rather than chemotherapy administration. CMS estimates that this new demonstration will result in $150 million in allowed charges for oncology services.

How the New Demonstration Project Works

Office-based hematologists and oncologists will receive an additional payment of $23 in conjunction with level 2, 3, 4, or 5 established patient office visits for patients with one of 13 specified cancer diagnoses when they report on (a) primary focus of the visit, (b) extent to which management of patient adheres to relevant clinical guidelines established by ASCO and the National Comprehensive Cancer Network, and (c) current disease state.

The 2006 demonstration program focuses on the physician's evaluation and management service; therefore, there is no longer a requirement that the patient encounter be related to chemotherapy to qualify for the demonstration. CMS has established a series of new Medicare G-codes in each of the three required categories to enable reporting (available online at; see resources sidebar). Physicians will be required to bill one code from each section for each encounter to receive payment. Up-to-date guidance on the demonstration project is available at

Quality Reporting Program for All Physicians

The Centers for Medicare & Medicaid Services (CMS) is also launching another Medicare quality-reporting initiative affecting physicians, the recently announced Physician Voluntary Reporting Program (PVRP). CMS is implementing G-codes for reporting of 36 quality measures, which include smoking cessation intervention in patients with chronic obstructive pulmonary disease, influenza vaccination, and mammography. With the stated intent of “help[ing] physicians obtain information they can use to improve quality and avoid unnecessary costs,” CMS plans to provide feedback to physicians on their level of performance. This program is distinct from the 2006 oncology demonstration project and is not currently linked to any additional payments from the Medicare program.

Diagnoses Included in the 2006 Oncology Demonstration Project

  • Breast cancer
  • Chronic myelogenous leukemia
  • Colon cancer
  • Esophageal cancer
  • Gastric cancer
  • Head and neck cancer
  • Multiple myeloma
  • Non-Hodgkin's lymphoma
  • Non–small-cell/small-cell lung cancer
  • Ovarian cancer
  • Pancreatic cancer
  • Prostate cancer
  • Rectal cancer

Essential Resources for New Medicare G-Codes Available Online

Visit for printer-friendly breakdowns of the new Medicare G-codes (released November 23, 2005)*:

  • Codes for primary focus of visit and practice guideline adherence
  • Codes for current disease state for
    • cancers of the lung, breast, prostate, colon, rectum, esophagus, pancreas, and head and neck
    • GI and ovarian cancers
    • non-Hodgkin's lymphoma
    • multiple myeloma
    • chronic myelogenous leukemia
  • 2006 Coding changes for Drug Administration Services: A cross reference between 2006 CPT codes, Medicare's 2005 G-codes, and 2005 CPT codes.


*All resources up to date as of press time

Articles from Journal of Oncology Practice are provided here courtesy of American Society of Clinical Oncology