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Policy Updates: ASCO 2019

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From the Oncology Care Model to the possibilities of cannabis, policy issues drew big crowds at the 2019 Annual Meeting of the American Society of Clinical Oncology.

Oncology Reimbursement Reform Leaves Stakeholders With More Questions Than Answers

Oncologists and representatives from UnitedHealthcare and the Center for Medicare and Medicaid Innovation (CMMI) took the stage at the 2019 Annual Meeting of the American Society of Clinical Oncology to discuss oncology reimbursement reform and possible changes on the horizon for the promotion of higher-value care.

Jennifer Malin, MD, PhD, FASCO, senior medical director of oncology and genetics at UnitedHealthcare, started off the session by explaining what oncologists and patients already know:

Healthcare costs are unsustainable.

“When we talk about the cost in healthcare, oftentimes we focus on just the pricing of the drugs and what individual out-of-pocket costs are. But the overall impact on the total cost of care is what impacts people’s premiums and what the federal or state government has to pay for Medicaid. That impacts the overall affordability for people to buy insurance in the first place,” said Malin.

She then reviewed some strategies oncologists are all too familiar with that payers use to improve the value of cancer therapy, such as clinical pathways, episode-payment shared savings, bundled payments, and shared-risk capitation.

UnitedHealthcare utilized each of these strategies in creating their own cancer episode program. The program, first implemented by Malin’s predecessor Lee Newcomer, underwent a proof-of-concept pilot study from 2009 to 2012. Afterward, results showed that the program had a 34% reduction in costs for the 5 practices that were enrolled.

“Our cancer episode program is a new payment model based on the treatment of cancer episodes instead of drug margins. The program removes an oncology practice’s dependency on drug margins and rewards physicians for improved quality and reduction in the total cost of cancer treatment. It also builds a learning system to identify best practices for improved quality and value,” she said.

After the results of the initial pilot, UnitedHealthcare rolled the program out to 250 practice sites. Due to the larger number of practices enrolled, collaboration between UnitedHealthcare and the practices went from monthly interactions in the pilot to less often. This, in part, contributed to the lower amount of savings—13%—seen once the program expanded.

In talking about the revolution toward value-based care, the faults with traditional fee-for-service (FFS) programs are often discussed. Karen Hoffman, MD, MPH, of The University of Texas MD Anderson Cancer Center, presented provocative data regarding practices that use FFS costing more money and more often referring their patients for more expensive treatments.

“In a model where physicians and healthcare providers are reimbursed for each service rendered, it may provide financial incentives to increase utilization of services or recommend services that are more expensive,” said Hoffman.

She explained that while physicians are prohibited by national statute from referring Medicare patients for designated health services at entities with which they have a financial relationship, study results show more services are used by physician “owners” versus nonowners.

“Specifically, the data show that there is an increase in anatomic pathology services by self-referring providers. In 2010, it was estimated that self-referring providers made 918,000 more referrals for pathology, which ended up costing Medicare $69 million,” she said.

Finally, Lara Strawbridge, MPH, of CMMI, presented about an effort to address costs that oncologists are quite familiar with: the Oncology Care Model (OCM). The OCM, which was implemented in 2016 as a 5-year model, is an episode-based payment model that targets chemotherapy and related care during a 6-month period that begins with a patient’s receipt of chemotherapy.

“The OCM has 176 practices, about 7000 practitioners, and sees 200,000 unique beneficiaries per year, with 260,000 episodes of care per year,” said Strawbridge. She provided an overview of some of the positive outcomes of the program, including an anecdotal story from a provider saying that “[the OCM] enables us to provide the care we’ve always wanted to do.” However, as the program nears the end of its 5-year pilot phase and CMMI looks to implement changes for the next version of the program, what spoke louder in Strawbridge’s presentation were the unanswered questions.

The OCM has generated a lot of actionable, valuable data for practices, although this has come at a cost of a high administrative reporting burden. Strawbridge didn’t mention those reporting burdens when discussing the challenges the OCM has seen over the past few years. What was mentioned, such as the limitations of the Medicare claims system and the complexity of practice business and coding models, are multifaceted issues that may not be addressed by the next rendition of the program.

For example, in a recent meeting of the Institute for Value-Based Medicine®, Jessica Walradt, manager of Managed Care of Government Programs, Value-Based Care at Northwestern Memorial Healthcare, explained there’s a lot of confusion around how episodes are triggered with the OCM due to an episode starting at the receipt of chemotherapy. This is because patients could be administered chemotherapy as maintenance therapy as well as an active treatment. Due to this, Waldradt said her institution is sometimes unsure which patients are even meant to be included in the OCM. This too, was not mentioned by Strawbridge.

In terms of the future of the OCM, much remains unclear. Strawbridge said, “We’re working on the next version of the model to include further improvement in quality of care and health outcomes, moving farther away from fee-for-service infrastructure for payments, considering chemotherapy and supportive care, and looking into the adoption of 2-sided risk.”


ASCO Town Hall Brings Tense Conversation on Drug Pricing

The American Society of Clinical Oncology (ASCO) held a town hall meeting to discuss drug pricing at its 2019 meeting, with moderator Jeffrey Ward, MD, FASCO, hematologist at the Swedish Cancer Institute, joining Rodney Whitlock, PhD, of McDermott+Consulting. 

Drug pricing seemed like an appropriate topic for ASCO’s town hall as the Trump administration has made lowering the cost of medications a major objective. The administration has put out a series of proposals looking to address the cost of drugs, such as the International Pricing Index (IPI) and the recently finalized rule around direct-to-consumer advertising for pharmaceutical companies.

“What we have is 3 types of issues out there that you see policymakers discussing,” Whitlock said. “There are blockbuster drugs coming out with significant price tags attached, speculation issues around astronomical drug price increases given the ‘villian’ made-for-our-time Martin Shkreli, and finally, there’re regular drug price increases where drug companies raise their prices in January. Why? Because it’s January. And then again in June. Why? Well, because it’s June.”

However, the issue of drug pricing has not yet been linked to a single direct, surefire cause. It’s no secret that patients are feeling the effects of out-of-pocket costs of drugs, whether it’s in co-pays or co-insurance costs, but who is to blame? “There’s a tremendous amount of ‘not it’ and finger pointing going on. Drug makers want you to believe that the issues are the $700 aspirins at the hospital—that it’s everyone but them. But on the other side, you see other stakeholders who set the prices and they’re also saying it’s not them, but we don’t know because it’s not a transparent system,” he said.

When asked if he believes the politics will change around whether the government should have a place in instituting drug prices, Whitlock said there’s definitely renewed interest in and openness now to say that if the marketplace isn’t working for consumers under the current system, then the government will come in and set pricing.

“An example would be, look what’s happening with surprise billing. Congress has given that great interest, and once they heard about it, they took it on and basically said, ‘Well then, let’s just stop this right now,’” said Whitlock. “It’s a gateway drug to larger price controls. Once you do it there, can’t you go other places to set price controls? I mean, the government has been doing that in the Medicare space for quite some time now.”

Regarding the IPI model, Whitlock offered a word of caution for what the drug companies’ response to such a model would be. He hypothesized whether the companies would try to get underneath the IPI and raise costs in other countries, so as to not lose money in the United States, or would they simply accept the lower payments?

“[This is something] that hasn’t been discussed with this issue. It’s the point that there is clearly a trade issue at hand here. Other countries are able to tell drug companies, ‘You have to sell at this price to sell in our countries.’ Now, yes, drug companies could get out of [the problem the IPI poses] by raising the prices in other countries. But what isn’t being addressed—and this is truly a trade issue—is the inability of drug companies to raise prices in other countries even a nickel,” said Whitlock.

The question remains, “What will the administration do regarding the IPI? Although there was a final rule put out, it has yet to take an effect. Whitlock floated the notion that the administration is using this proposal, and others, as a bargaining chip for what may come together in the fall as a larger deal with Congress. Perhaps not. Either way, Whitlock stressed that healthcare stakeholders need to pay attention to what’s happening in Washington, DC, and stay clued in as to what’s to come. “As they say, if you’re not at the table, you’re on the table.”

In an attempt to bring the conversation back to the oncology stakeholders in the room, Michael Kolodziej, MD, vice president and chief innovation officer at ADVI Health, Inc, poised his question in earnest: “We, as oncologists, are floating on the Titanic, and we’re worried about what next song the orchestra will play because all of the stuff we’ve been doing forever is going to become incredibly irrelevant as we move into combination I-O [immuno-oncology] therapy, CRISPR [Clustered Regularly Interspaced Short Palindromic Repeats], and CAR T [chimeric antigen receptor T-cell therapy].

These are therapies that will cost, per patient, $500,000 to $1 million…. Help me understand why we’re not interested in pursuing outcomes-based contracting—through a model, through legislation, anything—because as we move technology forward, and the prices will go up with that advance, we need to find a way to pay for it.”

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