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Dr Michael Kolodziej on the Challenges of Value-Based Payment Models in Oncology

There are a number of challenges with implementing value-based payment models in oncology, but it's an exciting time and offshoots of the Oncology Care Model (OCM) can "revolutionize" cancer care delivery, said Michael Kolodziej, MD, national medical director of managed care strategy at Flatiron Health.

There are a number of challenges with implementing value-based payment models in oncology, but it's an exciting time and offshoots of the Oncology Care Model (OCM) can "revolutionize" cancer care delivery, said Michael Kolodziej, MD, national medical director of managed care strategy at Flatiron Health.


What are the challenges of implementing innovative payment models in oncology?

The first challenge is identifying the populations that you wish to include. Now, the Oncology Care Model (OCM), selected the initiation of systemic therapy as the trigger event, and they decided upon an attribution model where the provider with the plurality of visits was the responsible care delivery person. And they decided to include as many cancers as they possibly could. So that's the first challenge, and, God, we could debate this all morning. What's right about one, what's right about the second.

The second challenge is this: what do you include? Now, they have chosen a total cost of care model. I think there were reasons they chose a total cost of care model; I'm not sure they're right. Every physician knows that in a total cost of care model, there are things that happen to patients you have absolutely no control over. You have no control over the occurence of those events, and you have no control over the cost of those events, or who's providing care for thoser events. You are downstream. Models that include only certain elements, like cost of chemotherapy, hospitalizations, and emergency room, might be more attractive, but they were not attractive to CMS. They wanted a cost-of-care model. 

You have to decide on quality metrics. And that is not trivial in oncology, since nobody has come up with a good list of quality metics. I have said, publicly, maybe the people at CMMI [Center for Medicare and Medicaid Innovation] don't like it, I have said that I don't like the quality metrics in the OCM. I think they're silly. First of all, they were not constructed with an eye toward the collection of that information electronically. So we know now that 85% of physicians in America are on electronic medical records. Now, you can argue that that hasn't changed a thing except how much doctors look at patients when they talk to them. But there's a wealth of information there that we have to figure out how to harness. And you have to ask the questions right to get the right answers.

So there are issues with the quality measures. We need better quality measures. And when you're constructing quality measures in alternative payment models, you need to be sensitive to both the quality of care the patient receives, and being sensitive to the fact that the model might incentivize withholding care for financial reasons. And we've been burned on this in American medicine before, we should not make the mistake again.

Then the payment model has to be decided on. So payment is a challenge. OCM gave you money upfront, the MEOS [Monthly Enhanced Oncology Services], the management fee, which was designed to provide the fuel to allow the engine of innovation to start care delivery reform. And then offered the opportunity for shared savings. That, I think, is going to prove to be a very challenging model for a lot of practices. We'll see. And the reason for that is my final comment, which is the analytics around this whole delivery model, particularly this total cost of care model, have really been slow, and that's because of a couple of reasons. One is practices never saw claims before, it's amazing, right? And when they got the data dump from CMS, there was a ton of good stuff there, but it was not in a language that practices spoke. So they had to sort it and figure it out. And there are things missing from claims that are critical to understanding physician performance. And the most important one is case mix.

So I gave a talk here, at the OncoCloud meeting yesterday, where I talked about the fact that in breast cancer, if you have a patient who needs to receive herceptin, that patient's drug costs will be 450 times greater than a patient receiving tamoxifen. Now just think about that for a second. If you're in a model where all the breast cancer patients are lumped together, and let's say you have 2% more HER2-positive breast cancer patients than you had before, you can't win. I mean, the math simply does not allow you to win. So we will need refinement and that refinement will come on the heels of a good analytic model that really lets us identify subsets of patients. And that's great for the practice, because, among other things, you can't do everything for everybody. It's just not possible. And every oncologist knows that certain patients are at higher risk of hospitalization, they need more intensive care and this will be a way to quantify that and lead to some really innovative ways to intervene.

This is a great time for this. There are so many potential offshoots of what the Oncology Care Model can do, it's going to revolutionize the way we deliver cancer care.

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