February 2014, Vol 3, No 1
Need for Innovative Strategies for Quality Care Will Continue to Grow
Oncology Reimbursement Requires New Approaches, Says Lee Newcomer
Current economic trends mandate the development of innovative strategies to effect quality and efficiency in cancer care, applying the same rigor as used in clinical trials, according to Lee N. Newcomer, MD, MHA, Senior Vice President, UnitedHealthcare, who addressed cost issues and barriers in provider reimbursement at the 2013 ASCO Quality Care Symposium.
Less Money for Patient Care
Within 2 to 3 years, consumersâ€™ out-of-pocket costs will consume half of the average household income, Newcomer said. Another 10 or 15 years down the road, healthcare costs will require the entire household income, according to a study published in 2012 (Young RA, DeVoe JE. Ann Fam Med. 2012;10:156-162).
Such an impossible situation will mean that providers at every level will have to get by with less. â€śNo one will be exempt from having less money available to take care of even more patients,â€ť said Newcomer. â€śIt wonâ€™t matter whether youâ€™re a social worker or a nurse or a physician, a hospital, a pharmacy institute, or a payer. We will all have less money to work with,â€ť he emphasized.
â€śOne of the things we have to learn to do is to eliminate all of the waste. The things that donâ€™t make as much difference to us as quality-of-life money. We have to figure out how to deliver the best outcome with the limited resources we have available.â€ť
Currently, approximately 22% of every UnitedHealthcare oncology dollar goes to pharmaceuticals, the cost of which is increasing by 10% to 15% annually. Hospital costs account for 54% and are also increasing at a rate of approximately 10% annually. Physicians â€“ all physicians, not just oncologists â€“ account for the remaining 24% of the cost, and their costs are in a negative-
inflation status, said Newcomer.
Innovation in Reimbursement
Innovation in payment strategies focuses on 3 basic models: the pay-for-performance model, bundling or episodic payment, and capitation. Pay-for-performance is by far the most popular strategy and is usually tied to clinical pathway adherence. At UnitedHealthcare, currently 80% of the patients with cancer are treated based on predetermined pathways, according to Newcomer.
Measuring the performance and outcome of various payment strategies faces several barriers, he says. The first relates to enrollment of a sufficient number of patients to conduct quality-of-care studies. The majority of patients do not qualify as â€śtypicalâ€ť patients that would be needed for a study of different reimbursement models. Related to study enrollment is the time required to conduct studies, which require several years to complete.
Identifying an appropriate control or comparison group can also be problematic, including the decision to compare outcomes and costs on a year-to-year basis, or to use a control group followed over the same duration of time as the study group.
Finally, the funding of clinical trials is complicated because everyone wants a share of the savings that result from improved care efficiency and lower costs. Moreover, most healthcare organizations already have relatively slim margins from which to trim additional costs.
â€śItâ€™s very difficult to find a lot of money to fund pay-for-performance programs,â€ť said Newcomer.
As another example of the difficulties involved in finding reward money for pay-for-performance initiatives, he described an oncology practice that performed better than the national average for virtually all types of cancer; however, that practice already received a 33% premium on payments as a result of a higher fee schedule, and the groupâ€™s performance was only slightly better than the national average.
â€śFor pay-for-performance to work, we not only need to get good results, but we need to get results that are proportionate to the payment,â€ť said Newcomer.
Measuring Quality and Cost-Effectiveness
The difficult realities associated with the pay- for-performance approach have led Newcomer, and possibly others, to reconsider the approach to measuring quality and cost-effectiveness. Specifically, he questions whether payers have had the wrong focus in their efforts to achieve cost-efficiency and good outcomes.
Payers can easily compare chemotherapy regimens, he continued. As part of preauthorization, detailed clinical information can be obtained, and then a payer can initiate an intend-to-treat study, specifying the regimen during preauthorization. Within a couple of years, a large organization can accrue hundreds, if not thousands, of patients using various chemotherapy regimens for different types of cancer.
â€śThis would give us a very good start toward comparative effectiveness studies, comparing regimens against each other,â€ť said Newcomer.
Such studies could help fill the void that has resulted from the disappearance of phase 3 cooperative group trials that compared chemotherapy regimens in various types of cancer.
Quality Care Research
To reduce costs, payers need to know which regimens provide the best results at the lowest cost and lowest toxicity. â€śThat is something payers can do and can do effectively, and with a large enough volume that we could start parsing out those regimens that are ineffective, and lowering cost in the process,â€ť Newcomer said.
Moving forward, he concluded, quality care researchers must continue to test solutions, because the need for better quality and efficiency will always be relevant. At the same time, payers, clinicians, researchers, and other interested parties must be realistic about the financial results that can be expected from improvements in quality and efficiency.
Finally, quality care researchers must apply the same rigor as clinical researchers use in clinical trials. â€śThe scientific method applies to business applications as well,â€ť said Newcomer.
PROGRESS REPORT: Implementation of ASCOâ€™s Blueprint for Transforming Clinical and Translational Cancer Research
In November 2011, ASCO issued a prescription for transforming clinical cancer research in the United States and speeding the creation of effective new therapies for patients. In its report, Accelerating Progress Against Cancer: ASCOâ€™s Blueprint for Transforming Clinical and Translational Cancer Research, ASCO laid out a vision for a cancer [ Read More ]
The Importance of the Multidisciplinary Team in Personalizing Care
Dear Colleague, One of the things that sets oncology care apart from the care of other illnesses is the necessity for the patient to be under the care of a multidisciplinary team. A patient with a cardiac issue may be managed just fine by a cardiologist. A patient diagnosed with [ Read More ]