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As Prospect of Risk for Doctors Looms, Cost Conversation Shifts in Cancer Care

Evidence-Based OncologyPatient-Centered Oncology Care 2015
Volume 22
Issue SP3

Oncologists now face a cost discussion that was not part of their medical training. It's a balancing act between the big picture of understanding the burdens on the system and "the patient in front of you."

More than 3 years have passed since the famous episode at Memorial Sloan Kettering Cancer Center, when the pharmacy committee’s oncologists told Peter S. Bach, MD, MAPP, that they would not put the colorectal cancer drug Zaltrap on the hospital’s formulary. It cost twice as much as a similar drug and offered no real advantage. An op-ed that Bach wrote with 2 fellow physicians for The New York Times forced Zaltrap’s manu­facturer to cut its price—and kicked off a national conversation about the cost of cancer drugs that continues to this day.

That discussion continued when Bach joined the panel, “Re­imbursement Chal­lenges for Oncology In­novations: Who Pays?” which opened the sec­ond day of Patient-Cen­tered Oncology Care 2015, presented by The American Journal of Man­aged Care in Baltimore. Also taking part were S. Yousuf Zafar, MD, MHS, an oncologist and health services expert at Duke Cancer Institute, who studies the cost of cancer care; John Fox, MD, MHA, senior medical director and as­sociate vice president for medical af­fairs at Priority Health; and Dan Klein, MHS, president and CEO of the Patient Access Network Foundation, which helps patients fund co-payments for expensive specialty therapies. Bruce Feinberg, DO, an oncologist and chief medical officer at Cardinal Health Spe­cialty Solutions, served as moderator.

Since the Zaltrap episode, Bach has introduced the DrugAbacus” an on­line tool to help patients think about a drug’s value. Both the American So­ciety of Clinical Oncology and the Na­tional Comprehensive Cancer Network have introduced value calculators. Discussions of cost, once off-limits for doctors, are considered essential when it’s clear that a 6-figure therapy will only offer a few weeks, perhaps months, of life.

But that doesn’t mean that doctors enjoy having those conversations, Zafar said. “As an oncologist who’s interested in value, I’m in a really in­teresting position,” he said, describing how he’s found himself in the clinic prescribing drugs he knows will offer marginal value.

When it comes to discussing cost and value of cancer drugs, he said, “There’s 2 conversations.” “First, you think about the value to society…we love the idea of performance-based coverage. But there’s that second dis­cussion in the clinic, where I’ve got to put some of that out of my mind as I discuss the cost with the patient.”

Like many other physicians, Zafar said, he finds himself having to ad­dress cost. “But we weren’t trained to do that. It’s our job to protect the patient from harm.” The definition of “harm” is shifting, however. Zafar’s own research, and that of others, shows that patients with cancer expe­rience financial stress that leads to other prob­lems, which can include poor adherence to oral therapies they take at home.


“I come from a market-oriented background, and for some period of time, I believed that we could get the market to function,” said Bach, as he started the discussion of what’s happened to cancer drug prices. “It doesn’t seem to be working out that way.” He described how many have used the example of the different hepatitis C drugs—how Sovaldi came on the mar­ket at $1000 a pill, but once the drug had competition, pharmacy benefit manag­ers were able to strike exclusivity deals to pay much less. That doesn’t really apply in cancer care, Bach said.

Drug development is advancing quickly, so substitutions aren’t always possible. In ad­dition, drugs that have been on the market for years keep rising in price. Bach cited the example of Gleevec, a standard treatment for forms of leukemia, which he said has gone up in price 5% each year, except for a 1-time 2% drop when a competitor reached the market. When it comes to cancer thera­py, he said, “We have too few purchasers and too few providers.”

Fox, the payer on the panel, intro­duced the idea of paying for outcomes. “We pay a lot of money for drugs that aren’t appropriate and don’t work,” he said. Payers would welcome relation­ships with drug manufacturers who would agree to prices based on wheth­er the drug worked, not “whatever price they demand.”


Feinberg asked whether patients are ca­pable of taking an active role in shared decision-making about value. “Is it too much of a burden?” he asked.

Klein said that a conversation about value implies there are high- and low-cost options, but that that’s not always true. “In oncology or hepatitis C, there aren’t always substitutions available, so it’s not a fair questions to ask,” he said.

Today, an insured patient typically still has plenty to pay out-of-pocket. The Affordable Care Act has given mil­lions health coverage, but Klein said many individuals with modest incomes also have high deductibles and co-in­surance and drugs in the specialty tiers can have high cost-sharing for cancer or hepatitis C.

The Patient Access Network (PAN) Founda­tion exists because too many people could not gain access to innova­tive therapies, even with insurance. “PAN plays a role that no one else fills,” he said. Some have asked whether patients truly feel the burden when a charity helps pay part of their costs, but Klein says that’s absurd. “The deductibles and co-pays are so high, it’s not even a question of a moral hazard anymore.” For a patient on Medicare earning 200% of the fed­eral poverty line, they’re spending 15% of their income “just to get through the donut hole,” he said.


Fox wondered whether choices about therapies would change as reimburse­ment formulas shift, requiring physi­cians to assume more financial risk. “What decisions will physicians make when they have some skin in the game?”

Feinberg, and then Bach, raised the possibility that there might be an in­centive to withhold therapy in some cases, just as some wonder if physi­cians have incentives to prescribe too much under the “buy-and-bill” formula that exists today.

Zafar said incentives and disincen­tives work today, but not always in the way people think. “I see it every day. The vast majority of the community oncolo­gists are treating patients the way they need to be treated,” he said. There have been times when a community oncolo­gist has referred a patient to Duke, be­cause the small practice could not af­ford to cover an expensive medication a patient needed. Zafar has been told, “Duke’s going to cover it.”

If there’s more focus on what patients want, Fox said, he believes more atten­tion will be paid to palliative care. “We need to understand what patients want, what families want, and eliminate what patients and families don’t want.”

Bach returned to a theme that set off the national conversation: the drug prices are simply too high. “Oncology is the only sector where the manufactur­ers set their own price,” he said.

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