How Do You Establish Value in Cancer Care?

While the incidence of cancer continues to grow, novel and targeted therapies being developed have seen much improved survival for even the deadliest of cancers. New innovations in cancer diagnosis and treatment are associated with high cost. Cancer therapy constitutes nearly 11% of the total healthcare budget, and it is rapidly growing.

While the incidence of cancer continues to grow, novel and targeted therapies being developed have seen much improved survival for even the deadliest of cancers. New innovations in cancer diagnosis and treatment are associated with high cost. Cancer therapy constitutes nearly 11% of the total healthcare budget, and it is rapidly growing.1 On the opening day of the 50th annual meeting of the American Society of Clinical Oncology (ASCO), held in Chicago, a late afternoon session, "Can we find common ground? Stakeholder perspectives on value in cancer care," defined value in cancer care and discussed the current problems and possible solutions facing the healthcare system.

The session was kicked off by Neal J. Meropol, MD, Case Comprehensive Cancer Center, Case Western Reserve University, who recently co-authored an article on best practice approaches for designing decision-support tools.2 The article describing the rigorous development process and initial feedback of the PRE-ACT (Preparatory Education About Clinical Trials) web-based-intervention designed to improve preparation for decision making in cancer clinical trials.

In his talk entitled "Value in cancer care: what’s the problem," Dr Meropol defined value as the ratio of benefit over cost. Benefit, he said, is a combination of survival, progression, quality of life, avoidance of toxicity, whereas cost is determined by biomarkers, the therapy received, therapy avoided, management of toxicity, and other indirect costs. “Value versus cost-effectiveness is the elephant in the room.”

Dr Meropol laid out the problems currently facing the United States:

· Approval based on “safety and efficacy”

· Producer sets the price for new innovation

· Payers cannot negotiate cost

· Consumers cannot be choosers

· Financial protections by insurance is eroding as cost-burden shifts to the patient

“The current system is unsustainable as it prevents access to high quality cancer care,” said Dr Meropol. However, he pointed out that recession, increased cost-sharing, payment reductions to providers, increased provider efficiency and slowed innovation have somewhat moderated healthcare spending. An uptick in spending growth is anticipated as the economy improves, insurance coverage improves, and the ageing population can increase healthcare spending.

However, we do need to note that oncology drug expenditures lead the way in spending among the various therapeutic areas—a 9.2% growth at $27.9 billion according to an IMS Institute of healthcare informatics study published in 2014. High cost of care can increase disparities in care and patient outcomes, primarily driven by co-pays, tiered formularies, part D donut hole in Medicare, and oncology drug shortages. The result? Patients delay in seeking treatment, they limit/alter their treatment, and hospitals reduce their spending on charity care. Financial concerns and problems of cancer patients influence their overall health.

Dr Meropol concluded that “The stakeholders need to work together to find solution(s), to drive policy, and achieve reform.”

In his ensuing talk, "Defining value: an ASCO initiative," Lowell E. Schnipper, MD, chief of Hematology/Oncology at the Beth Israel Deaconess Medical Center provided insight into ASCO's strategic initiative to define value in cancer care. Dr Schnipper, who is also the chair of ASCO’s Value in Cancer Care Task Force,3 talked about the unsutainable trends observed in the United States: Medicare is a major reason for deficit projections. Additionally, cancer costs are rising at 15% to 18% annually. Patient-centered should be one of the key elements of valued care. Dr Schnipper encouraged the oncologists in the audience to discuss the financial implications of therapy with their patients.

The main threats to value in healthcare, according to Dr Schnipper, include unwarranted variation in quality and outcome, harm to patients, wastefulness of resources and failure to maximize value, health inequalities and inequities, and failure to prevent disease. He believes the Quality Oncology Practice Initiative (QOPI)4 by ASCO will enable us to know in real-time the real variation in clinical practice as it speaks directly to the quality of care delivered. Additionally, payment reform can address the health inequality issue.

The goal of ASCO’s value initiative is to evolve a transparent, clinically driven method for defining and assessing relative value of cancer care options; providers will be provided with necessary skills and tools and the patients will have ready access to necessary information, including to cope with co-pays that can drive them to bankruptcy. The task force aims to find a balance between clinical benefit, toxicity, and cost.

“We are not caring about the dollars spent, rather how well we are caring for the patient. Patient-centric is the best way to go.”

Representing the patient voice in this discussion was Diane Blum, MSW, a former executive director at CancerCare, an organization that provides emotional and financial support to cancer patients and their families.5 Her talk, entitled ‘The patient perspective’, defined value in various terms.

Her favorite definition was the one by Scott Ramsey: An intervention in cancer care can be described as having value if patients, their families, physicians and health insurers all agree that the benefits afforded by the intervention are sufficient to support the total sum of resources expended for its use.

“Value is a dynamic process—hopes and expectations change through the continuum of illness and must be assessed regularly. Perception changes from cure to palliation. Value rests not just in clinical response, but also in trying.”

How do you help the patient assess value? ASCO’s choosing wisely campaign aids the process. Encouraging a conversation between the physician and the patient and a shared decision making process also prove very useful.

Blum suggested the following plan of action: more and an improved measure of value, increased education of providers about patients and about value, increased communication, and tools to aid the discussion.

Lee N. Newcomer, MD, United Health Group, was supposed to provide the payer perspective on the issue of increasing costs of diagnosing and treating cancer patients that faces our healthcare system. Newcomer recently published his perspective on innovative payment models and measurements in cancer care, where he introduced the models being evaluated by payer and physician groups for cost-effective care.1 The approaches include: (1) payment for performance programs (P4P) that reward physicians for meeting prespecified goals, (2) bundles or episode payments, and (3) capitation.1 However, he wasn’t present in person to deliver his presentation; he did it virtually via telephone.

Dr Newcomer emphasized that currently, healthcare costs take up 50% of an average household income, a number estimated to touch a 100% by 2020. When we talk about insurance benefit design issues, we realize that benefits are not cancer specific, value-based insurance design is hard to implement and site of service distorts benefit. Value-based insurance (VBI) is trying to create a differential between high-value and low-value services.

Barriers to VBI include access to an external, independent source of measurement to define value, such as ASCO's Value in Cancer Care Task Force. Additionally, consumer literacy is extremely important. Value-based programs expect consumers to digest a lot of information which can be overwhelming, especially when survival decisions are in question. Where and how do you draw the line for benefit gradients? But drawing a line will help set pricing. The most difficult option to choose would be to not pay at all—eg the payer will say: no PET surveillance post-therapy, no PSA testing for men with less than a 10 year life expectancy, no targeted therapy without a predictive biomarker etc.

Resources are limited: using high value resources and/or eliminating low or no value resources is the need of the day and decisions are not optional, said Dr Newcomer. AstraZeneca’s Vice President for Payer and Real World Evidence, Gregory P. Rossi, PhD, overlooks coverage and reimbursement submissions for the company, and is responsible for outcomes studies as well as fulfilling payer evidence requirements.6 In his presentation, entitled "Industry perspective: drug development, costs, and return on investment," he talked about the cost of innovation and research and development (R&D) investment decisions, value-based pricing, patient affordability, and common ground.

There is significant value in collaboration between research communities and patient communities to provide valuable cancer treatment said Dr Rossi,

What dives the cost of innovation and investment decision making? Success rates in pharmaceutical drug development are about 5%, driving costs per new molecular entity to $3 billion. (1 molecule/year for 3 billion spent/year). Technical risk, time, and market assumptions all impact investment decisions. So considering these investment costs, treatments directed at small patient populations require higher drug prices, to gain returns!

So what is the main issue? Value-based pricing of the last 17 oncology drugs approved in the United States found an average of 3 months of survival improvement. The monthly cost of care is an average at $65,000. Is this beneficial? NICE (in the United Kingdom) will definitely say ‘No’! It’s not cost-effective and it becomes difficult to define the willingness to pay threshold. Patient affordability is obviously a big issue, said Dr Rossi. It is inappropriate to tax the patients with high co-pays. The pharmaceutical industry has set up assistance programs, but this Band-aid is not sufficient to fix the current broken system.

"How should oncologists become value-based providers?" was the final talk of this really insightful session. Presented by Ezekiel J. Emanuel, MD, PhD, Vice Provost for Global Initiatives and chair of the Department of Medical Ethics and Health Policy at the University of Pennsylvania, said “Let’s be honest, it is about cost. We are concerned about value but we are also concerned about cost. Let’s all be honest as a community about where the real cost of cancer care is.”

More expensive treatments are being prescribed when cheaper treatments are available to us. The obligations of the oncologists: avoid unnecessary testing; when therapeutically equivalent treatment is available-prescribe the cheaper one (eg, advanced gastric cancer: 50-fold difference in price in NCCNs preferred therapy list; 20% difference for ovarian cancer-choose the cheaper one. Exclude options that do not add value. “This is not a victimless crime— to choose the expensive treatments when cheaper alternates are available. I do think we have common ground, but we can’t reach it without payment reform and taking steps to choose value-based options.”


1. Newcomer LN. Innovative payment models and measurement for cancer therapy. J Oncol Pract. 2014;10(3):187-189.

2. Fleisher L, Ruggieri DG, Miller SM, et al. Application of best practice approaches for designing decision support tools: The preparatory education about clinical trials (PRE-ACT) study. Patient Educ Couns. 2014 Apr 21. pii: S0738-3991(14)00147-5. doi: 10.1016/j.pec.2014.04.009.

3. Nelson R. ASCO's new strategy to define 'value' in cancer care. Medscape website. Published April 3, 2014. Accessed May 30, 2014.

4. Dangi-Garimella S. QOPI, the ASCO initiative, improves compliance and promotes quality of patient care. Am J Manag Care. 2014;20(5):SP153-SP155.

5. CancerCare website. Accessed May 30, 2014.

6. AstraZeneca website. Accessed May 30, 2014

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