Laura is the editorial director of The American Journal of Managed Care® (AJMC®) and all its brands, including The American Journal of Accountable Care®, Evidence-Based Oncology™, and The Center for Biosimilars®. She has been working on AJMC® since 2014 and has been with AJMC®'s parent company, MJH Life Sciences, since 2011. She has an MA in business and economic reporting from New York University.
Data and collaboration are necessary ingredients to succeed in the transition to value-based care models, and the money saved under these models will create room to pay for unconventional therapies and services in healthcare, according to panelists at The Institute for Value-Based Medicine meeting in Seattle, Washington.
Although the United States now spends almost twice as much on healthcare compared with peer nations, just a few decades ago the country’s spending was much closer to other nations. The biggest culprit: prices, explained Sibel Blau, MD, medical oncologist at Northwest Medical Specialties, PLLC, at the November 7 meeting of The American Journal of Managed Care®’s The Institute for Value-Based Medicine. The dinner discussion, “Advancing Quality in Oncology Care” was held in Seattle, Washington.
Blau kicked off the meeting with an overview of the economics of cancer care in the United States, highlighting that the cancer market is lucrative for investors and that when looking at all healthcare expenditures, cancer care far exceeds any other disease, with drug costs and hospital prices as major contributors to cost inflation.
By 2026, there will be an estimated 20.3 million cancer survivors, an increase of 16% from 2016, and those survivors will be feeling the burden of the cost of their treatments.
“There are a lot of cancer patients that are going to be living longer because of all the discoveries and drugs and advances; but it’s expensive, so up to one-third of those patients will incur medical debt, and up to 78% will face financial hardship,” Blau said.
While CMS has mandated the transition from volume- to value-based care, these programs are not perfect, as the panelists discussed.
The Value Equation
Ray D. Page, DO, PhD, FACOI, medical oncologist at The Center for Cancer and Blood Disorders (CCBD), noted that the old system was definitely not working. Not only did it drive up costs for patients, but the traditional system also led to community oncology practices closing at a fast rate. Data from the Community Oncology Alliance have shown that more than 400 practices closed a site in 2017 and more than 600 were acquired by a hospital.
“In the traditional buy-and-bill system, if you’re going to stay in that system and not make transformational changes…an oncology practice will die under a fee-for-service, buy-and-bill method alone,” Page said.
Currently, practices are stuck between 2 worlds, said Tom Gallo, MS, executive director of Virginia Cancer Institute (VCI) and president of the Association of Community Cancer Centers. As long as the transition to value-based care is incomplete, some of what practices do for value-based care could hurt them in fee-for-service and vice versa. So while people are trying to be encouraged to seek care at lower-cost sites of care, hospitals are still incentivized by having bodies in the beds.
“You really have this dichotomy going on as we go through this transition,” Gallo said.
The challenge, as practices continue to get squeezed between the colliding universes of fee-for-service and value-based care, is that the equation for calculating value has gotten more complicated. The simple, widely held view is that value equals quality at the lowest cost. But the government has far more difficult equations to calculate value according to the Medicare Access and CHIP Reauthorization Act and the Oncology Care Model (OCM).
“It’s not unlike your IRS tax forms,” Page said. The final equation becomes a massive calculation across multiple lines on a spreadsheet with equations to figure out individual aspects of a larger, final equation.
He ran through multiple slides that outlined how if practices want to figure their target price for a given episode, they first have to calculate the baseline price, the trend factor, the novel therapies adjustment, and the OCM discount rate.
What the OCM equation misses are things like the art of medicine, compassion, personalized medicine, and social determinants of health, Page noted.
After 2 performance period results from the OCM, he admitted that his practice, which worked with UnitedHealthcare for an episode fee pilot program, was 1 of 3 practices in Aetna’s Medical Home Shared Savings program, and was 1 of 7 practices in the COME HOME program, was still in the red. While they’re currently in performance period 5, practices just received results from the second period, highlighting the huge lag time until practices receive data about what they’re doing. Once performance period 7 hits, CCBD will have to entertain going into a 2-sided risk model as part of the OCM’s structure that moves practices out of 1-sided risk and into 2-sided risk if they have not achieved performance-based payments by the time of performance period 4 reconciliation (expected to take place around the middle of 2019).
Both Gallo and Page noted that participating in OCM and other value-based models requires large practice transformation in order to be successful.
“When you start thinking about [value-based care], the first question is: do you first go out and get value-based care contracts? Or do you undertake practice transformation and process improvement first?” Gallo asked. “It’s a really difficult question to answer.”
He pointed out that since a lot of programs use historical costs as a benchmark and to create a target, practices with higher costs have the most potential for shared savings.
“So, if you do process improvement first, you reduce your costs, you’ve already taken care of a lot of the low-hanging fruit,” Gallo. “It actually makes it more difficult for you to achieve success, at least financial success, in a number of these models.”
Ultimately, Gallo’s group had made many changes before the first value-based care contracts and well before OCM. The practice introduced financial counselors to help patients make payments, instituted a same-day clinic and weekend hours, utilized National Comprehensive Cancer Network distress assessments, and implemented follow-up calls after the first chemotherapy session.
VCI also formed an accountable care organization with 20 other practices in the market. Not only does this improve care, but it allows practices to stay independent, which maintains a strong referral base.
“What we’ve done through this organization is really be able to communicate much better with each other in terms of looking at our overall costs, brainstorming ways to reduce those costs, and actually implementing it,” Gallo said.
Some of the major practice transformations CCBD has made to manage its cancer patients, included implementing oncology clinical pathways and triage/symptom management pathways; hiring nurse navigators to educate patients on insurance requirements, the triage process, and support services; gotten actuarial support to understand the OCM data and make improvement changes; utilized a risk-stratification tool that uses artificial intelligence to analyze 30-day mortality, decline in 6 months, depression, pain, and emergency department (ED) risk; and added support services to mitigate risk from peripheral problems.
Now that the practices have implemented changes, both Page and Gallo noted that they are using the data from CMS under the OCM to identify new opportunities. Gallo called OCM a “treasure trove of data.”
He said that VCI is now more cognizant of the cost of prescription drugs and has a pathways committee that looks at efficacy, cost, and financial burden, and has taken a look at end of life care, including deaths in hospital with no hospice and the proportion of patients enrolled in hospice while in the hospital.
Page acknowledged that his practice doesn’t maximize the evaluation and management codes to get paid for all the services it provides. It also wants to improve palliative care coordination and utilize more telemedicine, especially in rural areas since the analysis of OCM data showed issues among rural patients who go to the ED when they have issues because they don’t have access to the right resources where they live. The practice is also investigating home visits and how to better coordinate care with specialists.
He finished by emphasizing the need for collaboration. CCBD and VCI are both part of the Quality Cancer Care Alliance, one of a number of national supergroups that have formed to pool information and share best practices.
“To stay alive…you can’t do it on your own,” Page said. “This is a team sport, so we have to share our knowledge…”
Gallo added that collaboration is important because the value-based care movement is affecting everyone. It isn’t just affecting oncology, either, and practices in the community can learn best practices from one another.
“We’ll try anything when it comes to these programs to see what works and what doesn’t when it comes to reducing costs,” he said.
Both Page and Gallo noted that OCM, and most value-based care programs, are not perfect. Page said that OCM has a lot of flaws and still needs to be tweaked. Gallo agreed, saying that his group finds flaws with the program every day. Regardless, participating in it is critical.
“None of these programs are perfect, but we thought it was important to be involved in the beginning,” Gallo said and quoted the old maxim, “if you’re not at the table, you’re on the menu. We wanted to be at the table.”
The Payer's Role
The meeting closed out with a payer perspective as Lili Brillstein, MPH, director of episodes of care at Horizon Blue Cross Blue Shield of New Jersey, highlighted how the payer had collaborated with its providers to build a model for value-based care.
She explained that under fee-for-service all parties would come to the table with their “dukes up,” fight, negotiate, and come away with a decision that made no one happy, all without mentioning the patient. Then the parties don’t speak for another 3 years, until they go through the process again. The focus in this type of contracting is on all the care rendered by 1 physician or practice without considering whether or not the patient got better or had a good experience,
In contrast, value-based care relies on communication and collaboration between all parties in order to be successful. Instead of focusing on care from 1 physician, these contracts focus on “care rendered to 1 patient across the continuum,” Brillstein explained.
Under the episodes of care model Horizon uses to engage specialists, physicians are accountable for all care rendered to the patient, which is much more difficult and requires more information, which the payers provide in a format that allows physicians to see across the continuum of care and where there are opportunities to make changes.
However, Brillstein acknowledged that, still, nothing is built to support value-based care models. “Everything is still built on the fee-for-service chassis.” As a result, Brillstein is a big proponent of upside-only models, which allows for extra time for all parties to work out the kinks.
The Horizon episode of care model sits on a fee-for-service chassis that began as a retrospective, upside-only model. If there are no savings, Horizon and the providers can work together to find out where opportunities were missed. The next stage is to move to a low-risk model that has downside risk capped.
Horizon is also working on an oncology medical home that is in response to New Jersey providers in OCM who weren’t performing well. Horizon built an OCM-like model with no risk that provides a per member per month payment. There will also be a stage with low risk, and if all goes well, the model may move to full risk. Although, Brillstein acknowledges they may never get to that.
She also took time to discuss that value-based care provides opportunities, although people rarely talk about it, to bring in complimentary therapies. However, if these value-based care models are done right, there should be enough money saved from some of the activities done to be successful that healthcare can fund things like Uber to get patients to the doctor’s office, medical nutrition, meditation, and yoga.
“All sorts of things that in a fee-for-service model would never even be considered,” Brillstein said. “But in a value-based model the focus is on the outcomes. What has the biggest impact on the patient’s outcome for the lowest cost?”