New Payment Systems in Oncology: Aligning Incentives for Value and Accountability

Linda D Bosserman, MD, FACP

Medical Oncologist and PresidentWilshire Oncology Medical Group

Affiliated with US Oncology

Disclosures

• President and stockholder of Wilshire Oncology Medical Group

• Consultant for US Oncology• Received grant/research support from Pfizer

Pay Differently for Different Outcomes: Aligning Information and Incentives Current System Pays for Volume and Drugs and has

inadequate data for meaningful evaluations of care, quality, costs or value

New Payment Systems Need to Align Goals: Patients need:

Ability to evaluate quality and cost of care by different groups Access to high comprehensive care, clinical research and support

services Practices with approaches that achieve high patient satisfaction Lowest costs for best outcomes and choices on how to spend their

money Payers need:

Lowest Costs for Highest Quality of Care in most appropriate Site Targeted reports on delivered care, outcomes and costs Lower administrative burden for auth and UR, lower MLR Payers needs to work closely with Provider Delivery Network BUT: Payers need new systems and relationships to meet these

needs

Pay Differently for Different Outcomes: Aligning Information and Incentives

New Payment Systems Need to Align Goals: Oncology Delivery Networks Need:

Support tools and engagement by providers Evidence based care prompting at the bedside with

warranted variations Clinician leadership for high quality care coordination

and documentation for analysis & reporting Comprehensive approaches to lower costs of doing

business: supplies, HR management, benefits, networking, contracting, data analysis and business management

UR, UM and Authorization functions within the care delivery model

New Payment Systems Need to Align Goals: Clinicians need to Lead the Care Delivery Model

Development & Implementation of Evidence based Guidelines and warranted variations (tools and techniques)

Coordinate all aspects of cancer-related evaluations and care

Lead the delivery team: Mid Levels, RN, MA, Admin Staff

Oversee/Coordinate the sites of care: office, urgent care, ER, Hospital, Hospice, Home Care

Supported by oncology delivery networks to leverage expertise and cost savings benefits

Hematology & Oncology ChallengesSignificant growth in cancer incidence expected in

next 5 and 10 yearsCARE COORDINATION NEEDED for complex cancer

patients throughout the continuum:Primary care, specialists, infusion, after hours, disability,

rehabilitation, urgent care, ER, Hospital, tertiary care, clinical trials, psychosocial support, palliative care & hospice,

Prevention, Screening, Diagnosis, Therapy, Support, Recovery , Survival Plans, Palliative Care and Hospice

Data Needed to analyze quality, value and care needsPartnership between Payers and Oncology leadershipPartnership between patients, payers and providers

New Contracting needed to align incentivesCancer Care Management to achieve quality and value

Findings from Milliman Report 1*Cancer patients are less than 1% of a commercially

insured population, but they account for over 10% of costs

The variation in medical utilization and costs for cancer patients highlights an opportunity for better management

In particular, cancer patients receiving chemotherapy have high costs averaging $111,000 annually, approximately 4x the cost of cancer patients not receiving chemo

Opportunities for quality and cost improvement for cancer patients on chemo include:Reduction in chemo costs Reduction in chemo sensitive admissionsReduction in ER sensitive admissions

*Commissioned by US Oncology 10/09; Source:Milliman Analysis of Medstat 2007, 14 million commercially insured lives

Cum

ulati

ve %

Incr

ease

$55 B

$123 B

Cancer Medical Cancer Medical

Cancer DrugsCancer Drugs

HealthcareHealthcare

US GDP US GDP

-2.4%

9.2%

15.0%

15.1%

AnnualIncrease

$15.5 T

$2.5 T

$93.0 B

$42.0 B

2009

US GDP1

Healthcare2

Cancer Medical3

Cancer Drugs4

Sources1 Bureau of Labor and Statistics2 Kaiser Family Foundation, CMS National Health Expenditures data3 American Cancer Society, US Oncology data4 Medco Health Solutions 2009 Drug Trend Report

Oncology Drugs are leading the Drug Development Horizon400 new oncology drugs in pre-clinical or clinical

development171 in late stage trialsMarket projected to double from $26 B in 2004 to $55 B

in 2010

136

167

171

91

91

Drugs in Clinical Trials

Oncology & Hematology

Central Nervous System

Cardiovascular

Respiratory

Infectious Disease

Cancer Incidence Concentrations Vary Significantly:IE: Eastern LA-San Bernardino, & Riverside Counties

10

The 2008 adjusted cancer incidences within defined area is 11,991

The compound annual growth rate of cancer incidence is 2%

250

125

0

2008 Adjusted Cancer Incidences by Zip Code:

Wilshire Oncology

Cancer Incidence by Cancer Typein Eastern LA, San Bernardino and Riverside Counties

11

Breast, prostate, lung & colorectal cancer incidences represent 54% of all cancer incidences in the Inland Empire region

The “Other” cancer category includes all cancer specific ICD-9 codes (140-208 & 230-239), however, is not included within the above cancer definitions, as the majority of these “other” cancers are identified as malignant neoplasms of uncertain behavior whose point of origin could not be determined.

Cancer Type 2008 Incidence% of 2008

Incidence Total 2013 Incidence% of 2013

Incidence Total CAGRBREAST 2,809 18% 3,116 18% 2.1%PROSTATE 2,153 14% 2,452 14% 2.6%OTHER 1,900 12% 2,133 12% 2.3%LUNG 1,826 12% 2,072 12% 2.6%COLORECTAL 1,709 11% 1,943 11% 2.6%NH LYMPHOMA 684 4% 762 4% 2.2%MELANOMA 582 4% 620 4% 1.3%BLADDER 561 4% 630 4% 2.4%UTERINE 451 3% 503 3% 2.2%LEUKEMIA 446 3% 492 3% 2.0%THYROID 405 3% 439 2% 1.6%ORAL CAVITY 392 2% 443 3% 2.5%KIDNEY 392 2% 440 2% 2.3%PANCREAS 391 2% 446 3% 2.7%STOMACH 339 2% 396 2% 3.1%OVARIAN 285 2% 316 2% 2.1%BRAIN 226 1% 245 1% 1.6%CERVICAL 193 1% 211 1% 1.8%

Totals 15,742 100% 17,657 100% 2.3%

Data to Understand PopulationWhat is your Hematology-Oncology population?

Prevention and Genetic Risk: Assess and return to primary with care plan

Screening Programs coordinated with primary careNew abnormalities with possible cancer

Initial diagnostic work up with primary and specialists, oversight of tertiary care referrals and care coordination

Patients with Cancer or blood diseases Early/Curable Patients Advanced or Recurrent Cancer Patients Patients on follow up Palliative or Hospice Patients

Data for Therapy Population-1Patient Info

Disease, Stage, TNM, Tumor Features, Dx DateTreatment Plan: medical, surgical, XRT, otherPerformance Status and co-morbiditiesTherapy Regimens

Name, # cycles, Goal, Start/Stop, Guideline compliant, Cost vs. Alternative, Reason for any variances

Type and Line of Therapy with goal (cure/palliation) Support Regimens: Nausea and Growth factor

Regimen, #cycles, guideline compliant, cost vs. alternative

Data for Therapy Population-2Adjuvant/Neoadjuvant Therapies

Guideline adherence vis a via tumor features ER/PR/Her2 for Breast, OncoDx or MammaPrint risks Adenocarcinoma vs. squamous cell for lung K-ras for Colorectal

Metastatic or Recurrence TherapiesCost of regimensResponse to regimenDuration of response to regimenPerformance statusHospice discussion documented for 2nd line and

beyondHospice and Palliative care costs and benefit analyses

Data Can Help Us Improve Care Which Patients with which characteristics benefit? How do performance status and co-morbidities factor in? How do we coordinate cost effective prevention

strategies? What is cost effective for diagnostic and follow up studies? What are the cost effective evidence-based therapies? What are the cost effective support medication regimens? How are clinical trials integrated and at what

cost/benefit? How do we coordinate care cost effectively?

Med Onc, Rad Onc, Surgery, Reconstruction, Rehabilitation, Support

What can be done in office and extended urgent care vs ER and hospital care?

How are palliative care and hospice introduced and used?

Tracking Total Cost of Care Track Total Cost of Care for Patients

Cost effective prevention and diagnostics Cost effective therapy and support with care coordination Cost effective site of care management Cost effective end of life care management

Coordinate and manage out migration to tertiary care Clinical Trials: Integrate in network, track trial patients

Regimen standard vs. investigational care given Track savings from free investigational drugs vs.

standard Track any ‘extra’ care on trial and ensure billed to trial

If metastatic disease Track therapy, PS, lines of therapy and outcomes Discussion of palliative and hospice care, Track time off Therapy and time on Hospice Track time off therapy to death

Oncology Medical Home PilotComprehensive Reporting on Accountable Care

Demographics, diagnoses, co morbidities, performance status

Initial Consult, Prevention, Recurrence, Follow up, Transition back to primary and Hospice-Palliative care

Therapy: Cost Effective therapies and supportive care Clinical trials integration Care management: symptoms and side effects Care Coordination: surgery, XRT, tertiary care, others Site Optimization: ER/hospital vs. clinic/urgent care End of Life Care ASCO QOPI quality measures

Oncology Medical Home PilotPay differently for Different Outcomes

Partnership with payers to understand issues of patients, providers and payers: many challenges

Identify key issues, validation needs and costs for both sides

Develop incentives to align goals Tiered drug pricing/supports greater Pathways adherence

Pilot: Pay for desired servicesE&M, Therapy, Drugs: oral and IVCare Planning and Care Management Code PaymentsManagement: UM, UR, Authorization and Reporting

Track: projected savings from cost effective, coordinated care driven by payment for comprehensive planning and care management

Oncology Payment PilotsUnited Health Care

5 Sites, bundled payments for Breast, Colon and LungEvidence based pathways, tracking of care

costs/savings Aetna -USON Innovent Via Health: U Pittsburg PathwaysP4 Health: drug payment differentialsABC-Wilshire Oncology

Comprehensive care delivery and cost reportingPathways, Care Management, End of Life careStandard payments + Care Management & Care

Planning

Health Plan & IPA Support Community Oncology Networks Can:

Bring practitioners together for common care pathways Provide evidence based pathways – monitor & measure

Support practitioners Regional tumor boards and expert consultations Program and update Oncology EMR for Care Pathways Standardize IPA and health plan reporting and care tracking Regionalize urgent care, hospital and tertiary care referrals Share Clinical trials at regional sites to avoid outmigration Standardize cost effective care and support regimens Standard clinic processes: education, consent, delivery,

reporting Lower supply costs by enlarging the specialized network

Support Medical Directors and Administrators Financial and Care Delivery reporting for contracting support Utilization management tools

Questions & Discussion