Los Angeles, CA—The cost of cancer care is a major cost driver for payers, who are actively engaging in the management of this complex disease state. Payer approaches to cancer care continue to evolve, with new reimbursement methodologies key to maintaining affordability, said Gary M. Owens, MD, President, Gary Owens Associates, Ocean View, DE, and John Fox, MD, MHA, Senior Medical Director and Associate Vice President of Medical Affairs, Priority Health, Grand Rapids, MI, at the Fourth Annual Conference of the Association for Value-Based Cancer Care.
Cost and Value Based on growth in spending and the aging of the US population, medical expenditures for cancer in the year 2020 are projected by the National Institutes of Health to reach at least $158 billion (in 2010 dollars), representing a 27% increase from 2010. “That number could be as high as $207 billion if other new and unanticipated changes in medical technology occur, or if cancer patients continue to live longer and require more treatment,” said Dr Owens.
Cancer drugs are a portion of the 27% increase in cancer expenditures since 2010, and therefore represent a component of cancer care that payers are looking to actively manage, Dr Owens noted.
Healthcare is consuming more of the workers’ pay as workers’ contributions to health insurance premiums are increasing at a much more rapid rate than are inflation and wages. The result is a gap in the affordability of care. “Payers are challenged to balance access to care with responsible stewardship of their customers’ financial resources,” Dr Owens pointed out.
Payers are also challenged with the difficult task of assessing the value of new technology, including drug therapy, diagnostics, surgical treatments, advances in radiation therapy, and others. Robotic surgery is one such treatment that requires assessment of its value, as do the molecular and genetic diagnostics that are sprouting up, he said.
Other challenges to payers are consolidation of practices under hospital systems, creating shifts in the sites of care and its associated cost consequences. “The same care you got yesterday can cost 2 to 3 times as much tomorrow,” said Dr Owens. “That’s a direct factor in the way healthcare services are contracted for under payers, but, nevertheless, it’s the cold reality that payers are dealing with.”
Payers are also looking at new methods of reimbursement, such as reimbursement for following guidelines or pathways, reimbursement on a risk-based model, or the use of accountable care organizations. “It’s a huge living laboratory out there right now, and we’re trying a number of models,” he said. The addition of new healthcare consumers through the Affordable Care Act has also created an uncertain landscape of the health insurance marketplace.
Expect some limitations on access to some types of care, Dr Owens advised, and enhanced consideration of comparative effectiveness research and the cost-effectiveness of treatments in deciding this access.
Payer–Provider Collaboration and Payment Reform Dr Fox discussed the challenges of payer and provider partnerships, using Priority Health’s oncology medical home initiative as the example for a new approach to cancer care and the changes occurring in access to oncology care as a result of mergers, acquisitions, and facility closures.
Priority Health’s oncology medical home initiative has instituted payment reform, so that the plan pays community-based oncologists the acquisition cost for drugs and a flat care management fee independent of the stage and type of cancer, for patients receiving oral or intravenous chemotherapy (Table 1). Its fee recognizes a larger number of nurses, pharmacists, social workers, and financial planners in oncology practices than in other physician practices, Dr Fox said.
The plan also pays a $1500 annual infrastructure development fee, as well as a fee for treatment planning and advance care planning. There are also shared savings for reductions in emergency department visits and hospitalizations.
“We also agreed that there were elements that were important for high-quality care, and those included implementation of preferred therapeutic regimens,” said Dr Fox. “We agreed that we were going to have standardized care management programs, including nurse navigators, and patient engagement programs with a ‘call-me-first’ policy instead of calling their primary care physician or cardiologist. Finally, a critical element to providing high-quality care was enhanced access to same-day and next-day services.”
A number of performance metrics were also agreed on. End-of-life care was a critical domain for which measurements were established, such as the percentage of patients with cancer admitted to the hospital during the last 4 weeks of life, and the percentage prescribed chemotherapy in the last 2 weeks of life. Other performance domains agreed on were office triage, care access, and case management measurements; how to measure compliance with preferred regimens for first- and second-line chemotherapy; and patient satisfaction (Table 2).
“We’re in the third year of this program, and all of the practices have agreed to continue participation, because there was good collaboration and it was consistent with the way they wanted to practice,” said Dr Fox. The downside is the difficulty that practices have to comply with multiple payer strategies.
Statewide eligibility criteria for oncology medical home accreditation have been developed in Michigan. To be accredited, the practice must use a certified electronic medical record, its leadership must have oriented the staff on the importance and significance of the oncology medical home, the practice must be willing to share practice and aggregate patient data, and the practice must administer the Community Oncology Alliance patient satisfaction survey at least every 6 months.
