Site of Service Significantly Impacts Cost of Chemotherapy

Dana Taylor

August 2015, Vol 6, No 7 - Economics of Cancer Care


Chicago, IL—An analysis of chemotherapy infusion by Aetna shows that approximately 75% of their patients still receive chemotherapy in a community oncology setting, suggested Michael A. Kolodziej, MD, National Medical Director for Oncology Strategy, Aetna at the 2015 American Society of Clinical Oncology meeting.

Chemotherapy is expensive, and one of the factors influencing the cost of treatment is site of service,” he said. Treatment is increasingly being delivered in hospital-based settings, which costs more, but the reasons are not well-understood, which is an area of concern for payers.

“We are presenting data that confirm the site-of-service differential. The most expensive hospital-based site of service was more than 280% more expensive per patient than the most expensive office-based site of service,” Dr Kolodziej reported. He explained that for Aetna, “about 75% of patients are getting chemotherapy in the office setting.”

Aetna evaluated 56,422 members who received chemotherapy between August 2013 and July 2014, of whom 76% received chemotherapy in an oncologist’s office and 24% in a hospital-­based setting.

Significantly more women received treatment in the hospital setting, and significantly more elderly patients received chemotherapy in the office. Risk scores were higher in the hospital-based setting for breast cancer and some other tumor types, but there were no differences in site of service for colon and lung cancers.

The cost of chemotherapy and the total cost of care were significantly higher in the commercial population that received treatment in the hospital-based setting for all cancer types before and after risk adjustment.

The concept that sicker patients are the ones being cared for in hospital outpatient departments “is just not true,” Dr Kolodziej said. “There’s still a substantial impact of site of service,” regardless of comorbidities.

The chemotherapy costs were 50% to 60% higher with hospital-based site of service, and there was tremendous variability in the average chemotherapy allowed and the average total cost of care by site of service.

The average annualized chemotherapy costs ranged from $8788 to $55,820 for hospital-based delivery, and from $7272 to $19,692 for office-based delivery. The total costs of care varied from $81,616 to $293,814, and from $51,733 to $106,868, respectively.

The variability from state to state was notable, according to Dr Kolodziej. The most expensive state was Kansas, because “almost all chemotherapy delivery in Kansas has moved to the hospital, and hospitals have leverage,” he said.

The “hospital allowed per patient” was $55,820 in Kansas; other high-cost states included South Carolina, Arizona, Georgia, and New Jersey. By comparison, the states with the lowest ­“hospital allowed” for chemotherapy included Maine, Connecticut, Florida, Virginia, and Oklahoma, with amounts of less than $20,000.