Becker's Hospital Review

10 Sign up for the COMPLIMENTARY Becker's Hospital Review CEO Report & CFO Report E-Weeklies at www.BeckersHospitalReview.com or call (800) 417-2035 Hospitals, Insurers Devote More Attention to the Cost of Cancer Care (continued from page 1) More than 1.6 million people will receive a cancer diagnosis this year, according to the American Cancer Society. The startling diagnosis often leaves patients pursuing the most promising forms of treatment with less consideration for cost. A recent study led by researchers from Dana-Farber Cancer Institute in Boston and Duke Cancer Institute in Durham, N.C., found few patients ask about the costs of cancer treatments — many noted they want the best care regardless of its price tag, while others said they thought their physician should not have to worry about cost. While the clinical aspects of cancer have always been substantial, the financial aspects of the disease are increasingly coming to light. Medical expenditures for cancer are expected to reach at least $158 billion by 2020, according to estimates from the National Institutes of Health. Another recent study published in Health Affairs found cancer patients were 2.65 times more likely to go bankrupt than their peers without the disease. Finally, a study published in the Journal of the National Cancer Institute in March found no clear association between the survival rate of patients with advanced cancer and the amount Medicare spent on their care. The study also found significant variation in Medicare spending on cancer care — a difference ranging from 32 to 41 percent, depending on the region. Payors and providers are shining a brighter light on cancer costs Traditionally, payors and providers have been more cautious to manage the costs of cancer care compared to other conditions and specialties. There are two components to this. One is the highly specialized and sophisticated nature of oncology. There are more than 200 types of cancer, not to mention the specialty's cutting-edge technology, newly approved drugs, continual study findings and groundbreaking treatment options. The second factor is the sensitivity around the emotionally charged disease. When trying to reign in costs, health plans and providers have generally followed an old saying: Kids and cancer are off limits. Questioning the medical necessity of services in pediatrics and oncology was long treated as a last resort, as payors and providers thought it would be demonizing and stir negative publicity. In some instances, when payors did try this technique, lawmakers intervened, says Igor Belokrinitsky, principal with Booz & Company. "In some areas where health plans tried to say a treatment wasn't medically necessary, state legislatures would mandate that health plans cover a particular treatment, whether necessary or not." But more recently, in the move from fee-for-service to pay-for-performance, payors and providers seem genuinely interested in meeting each other halfway when it comes to cancer care and costs. Whether through clinical protocols, provider-patient counseling sessions, genetic testing or oncology-specific accountable care organizations and bundled payments, oncology presents several collaborative opportunities for providers and payors to better align incentives. Janene Culumber, senior vice president of finance and CFO for Moffitt Cancer Center in Tampa, Fla., says she's seen interest on both the provider side and the payor side for cancer care management. "Because we treat patients from all over the state, a lot of insurers have been approaching us. But we've also reached out to our biggest payors and said we want to participate in this together. We need to be partners." Moffitt partnered with Florida Blue in late 2012 to form a cancer-specific accountable care organization, and Ms. Culumber says the center is currently in active discussions with three other payors and expects to close deals soon. There is an agreed-upon scale by which payors and providers match their priorities. The first consideration is quality, or the effectiveness of the available treatments. Second is the patient experience and comfort of the treatment. Finally is cost. By aligning their concerns, care management arrangements can defy criticism of care rationing, as well. Ms. Culumber said care plans will never be altered in Moffitt's ACO for cost purposes; rather, the model is encouraging physicians to keep a closer eye on the prices of certain care processes. As Mr. Belokrinitsky says: "Cost being last is better than cost not being in the consideration at all." Coming soon: Bundled payments, ACOs and quality reporting — specific to cancer Michael Kolodziej, MD, began his role as national medical director for Aetna's oncology strategies in February. Before then, he worked on the provider side as medical director for oncology services for US Oncology, which Aetna partnered with in 2010. In the past, Dr. Kolodziej says oncology was not so much a sacred cow to payors and providers as a black box with little transparency or dialogue. "I think the reason people were afraid to tinker with it was they simply didn't understand how things were done," he says. "That is changing." Aetna and US Oncology launched a pilot program for Aetna members treated by physicians with Texas Oncology from June 2010 through April 2012. Under that pilot, providers used guidelines for evidence-based medicine. Patients were able to discuss and make end-of-life plans with clinicians, and nurse navigators were made available to help manage patients' symptoms and side effects. By its end, the Aetna-US Oncology pilot reduced costs for lung, breast and colorectal cancers by 12 percent; decreased emergency room visits by 40 percent; and decreased hospital admissions by 16.5 percent among 184 enrolled members. Aetna found the results promising, and Dr. Kolodziej says he expects the insurer to begin offering bundled payments for subsets of oncology services within the next three years. Aetna also is looking at oncology-specific strategies for ACOs. Dr. Kolodziej also expects more transparency around oncology quality metrics in the next few years, and for that information to drive more patient decision-making. "Oncology has had a problem because there have not been formally adopted quality metrics. I think we'll see a very rapid expansion of public reporting to quality measures, including patient satisfaction," he says. "It's something we're experiencing now in the Medicare world, but I think it will go far beyond that. It will be one of the metrics that determines appropriate reimbursement for practices, and patients will look it up." On the provider side, Ms. Culumber says Moffitt has seen more scrutiny from payors for cancer care reimbursement, including more difficulty in obtaining authorizations. Insurers or benefits managers are asking many more questions that require a finer level of clinical detail. "Oftentimes, our nurses can't quite answer all the questions. We have to go to the physicians," she says, and payors sometimes request peer-to-peer review process between physicians. Ms. Culumber said the main goal for its cancer-specific ACO with Florida Blue is to both improve the quality of care and reduce the cost of care. "We're also looking to ensure our physicians are not only following clinical pathways, but also have their eye toward costs. If there are three drug regimens and all are equally effective with low toxicity for the patient but one is less expensive, we're trying to drive behavioral change to pick the lower cost drug," says Ms. Culumber. Noting that "once one of anything is created, looks to be successful and meets the needs of organizations," Ms. Culumber said she believes cancerspecific ACOs are likely to catch on, as well. Emerging, and mutually beneficial, cost management strategies Cancer care management programs can be structured in a way that is beneficial to everyone involved by eliminating processes that have no clinical

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