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Lessons From the Field: How Practices Are Succeeding Under OCM

Jaime Rosenberg
As rising drug costs continue to take up a larger portion of the total cost of care, practices in the Oncology Care Model find themselves in control of a shrinking portion of total costs, according to anecdotes from an academic medical center and a community-based practice during the National Comprehensive Cancer Network’s Policy Summit held September 12 in Washington, DC.
Three years into the Oncology Care Model (OCM) and with feedback now from 4 performance periods, practices participating in the value-based model continue to strive for successful practice transformation that drives appropriate utilization and contains costs while keeping the patient and oncologist at the forefront.

However, as rising drug costs continue to take up a larger portion of the total cost of care, practices find themselves in control of a smaller portion of costs, according to anecdotes from an academic medical center and a community-based practice during the National Comprehensive Cancer Network’s (NCCN’s) Policy Summit held September 12 in Washington, DC.

In the last decade, there has been a more than 5-fold increase in incremental anticancer drug costs; average annual costs rose from $30,000 in 2006 to $161,000 in 2015. However, there has not been a corresponding increase in the measure of efficacy, according to scores from both the American Society of Clinical Oncology and the European Society of Medical Oncology,1 explained Kerin Adelson, MD, associate professor, chief quality officer, and deputy chief medical officer for Smillow Cancer Hospital at Yale New Haven/Yale Cancer Center.

Despite the challenge, approximately one-third of practices have been able to lower their total costs and achieve savings under the OCM. Adelson and Diana Verrilli, MS, senior vice president of Strategy and Practice Solutions at McKesson Specialty Health, which is part of the US Oncology Network, shared their experiences the model and what they’ve learned since they entered.

Addressing What You Can
Comparing costs of care from 2012 through 2015—before the OCM was implemented—with performance periods 1 through 3, overall cost of care increased from $28,000 to over $32,000 for Smilow Cancer Hospital; however, this was less than what CMS expected, so the network was able to achieve savings. To date, it has received over $6 million in performance-based payments.

Looking within the total cost of care, spending significantly increased for drugs, which accounted for 53% of costs between 2012 and 2015 and jumped to 60% in performance period 3. However, by focusing on the remaining 40% of other healthcare costs, Smilow Cancer Hospital was able to exert tighter control. The hospital did this by honing in on utilization patterns, specifically in the emergency department, with inpatient care, and in postacute care use. Through a new revenue stream under OCM, Smilow Cancer Hospital implemented infrastructure focused on those areas, by building a care management program, increasing access to palliative care, and opening an urgent care center.

The US Oncology Network has also seen success with the model. With 15 practices participating in the OCM, 14 fell below the benchmark during performance period 4; 5 practices received performance-based payments. Together, the practices achieved $36 million in Medicare savings, totaling $89 million in savings over 2-year period, explained Verrilli.

While most of the network's efforts also largely focused on reducing utilization, practices were able to target certain areas where they noticed large variation in utilization, including supportive care drugs. Looking at pegfilgrastim, for example, the group implemented appropriate use policies, which yielded positive results and brought the practices closer in line to, and even below, other OCM practices’ utilization rates.



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