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In AJMC, Brookings Authors Discuss Applying New Payment Models to Oncology


The realm of cancer care remains a holdout in the movement toward value-based payment models, with implications for cost and health outcomes, according to authors of a new article in The American Journal of Managed Care. Authors from the Center for Health Policy at the Brookings Institution assert that new payment models can be adopted by all payer and provider types, with benefits over the traditional fee-for-service model.

In AJMC, Brookings Authors Discuss Applying New Payment Models to Oncology


PLAINSBORO, N.J.—Many of the problems facing oncology stem from its ongoing reliance on the fee-for-service payment model, which should be substituted or complemented by newer payment methods that promote both savings and better patient care, authors from the Center for Health Policy at Brookings say in this month’s issue of The American Journal of Managed Care.

In “Transforming Oncology Care: Payment and Delivery Reform for Person-Centered Care,” authors Kavita Patel, MD, MS; Andrea Thoumi, MSc; Jeffrey Nadel, BA; John O’Shea, MD, MPA; and Mark McClellan, MD, PhD, outline how oncology’s inability to sever its reliance on fee-for-service has propelled the cost of cancer care upward. A study from the National Institutes of Health shows that costs are on track to reach $157 billion in 2020, a 27 percent increase in a decade. Of great concern, the authors write, is “that many higher-cost services are not demonstrably related to evidence or better outcomes.” To access the full article, click here.

According to a March survey by the American Society of Clinical Oncology (ASCO) fee-for-service persists in 72 percent of practices; in community practices especially, this model appears to be undermining the financial health of both providers and patients.

So what is the solution? The authors outline four core alternative payment models that build on or shift away from fee-for-service and discuss how each offers a path to better care delivery at reduced cost. The four models discussed are:

· Clinical pathways. These are standardized, evidence-based protocols for care.

· Oncology patient-centered medical homes. This approach builds on pathways and extends care coordination throughout the practice, with providers receiving a monthly fee to manage patient care.

· Bundled payments. Can occur within or outside a medical home, this model pays a set amount for cancer care services over a predetermined treatment period.

· Oncology accountable care organizations. This model partially ties payments to costs and overall quality of cancer care; a “shared savings” model would reward practices still using fee-for-service if spending falls below established benchmarks.

Early work with alternative payment models suggest savings is possible, although not every model will work for every setting in cancer care. A priority, the authors argue/emphasize, is developing evidence “of how new payment systems in oncology can better align physician reimbursement with care transformations to improve care coordination, quality of care, population health, and patient experience.”

About the Journals

The American Journal of Managed Care celebrates its 20th year in 2015 as the leading peer-reviewed journal dedicated to issues in managed care. Other titles in the franchise include The American Journal of Pharmacy Benefits, which provides pharmacy and formulary decision-makers with information to improve the efficiency and health outcomes in managing pharmaceutical care, and The American Journal of Accountable Care, which publishes research and commentary on new healthcare delivery models facilitated by the 2010 Affordable Care Act. AJMC’s news publications, the Evidence-Based series, bring together stakeholder views from payers, providers, policymakers and pharmaceutical leaders in oncology and diabetes management. To order reprints of articles appearing in AJMC publications, please call (609) 716-7777, x 131.

CONTACT: Nicole Beagin (609) 716-7777 x 131



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