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Redesigning Benefits, Value-Based Agreements With Better Cancer Care in Mind


The quest to deliver better cancer care—with better outcomes and patient experience—is not a one-size-fits-all journey, as seen in panels during the Community Oncology Alliance (COA) Payer Exchange Summit, held in Tyson’s Corner, Virginia.

To deliver better cancer care and save money, some employers have turned to direct contracting. In some places, practices that are too small for the Oncology Care Model (OCM) have tried adjustable care coordination fees. Even before the OCM, larger practices brokered agreements with insurers to deliver value-based care, and those agreements remain today.

The quest to deliver better cancer care—with better outcomes and patient experience—is not a one-size-fits-all journey, as seen in panels during the Community Oncology Alliance (COA) Payer Exchange Summit, held in Tyson’s Corner, Virginia.

Lalan Wilfong, MD, vice president, Payer Relations and Practice Transformation, The US Oncology Network, led the discussion, “New Strategies for Insurance Benefit Designs: From the Simple to the Complex,” which examined how employers can reduce the cost of cancer care—sometimes by thousands of dollars. Joining Wilfong were:

  • Bret Jackson, president, Economic Alliance for Michigan
  • Pete Scruggs, principal, Golsan Scruggs Insurance & Risk Management; and founder, benefitSmart Cancer Solutions, and
  • Karen van Caulil, PhD, president and CEO, Florida Alliance for Healthcare Value

Wilfong asked for an overview of the market, and van Caulil said as the COVID-19 pandemic eases, there is “renewed interest” in cancer care among employers. A recent survey showed that cancer had surpassed musculoskeletal conditions as the top area of benefit spending, she said.

Finally, van Caulil said, plan designs are embracing the concept of precision medicine by paying for biomarker testing and targeted therapies. “They’re finally seeing the value of paying for that on the front end.”

Attention to mental health in cancer care and high-value providers are other trends, she said.

Jackson’s coalition is evenly split between companies and labor unions, and many employees have rich benefit plans where cost-sharing is not top of mind for hourly employees. The focus since 2017 has been on creating incentives for oncologists to stick with evidence-based medicine based on National Comprehensive Cancer Network guidelines, in part by reducing administrative burdens if practices can provide data that show guideline adherence.

Scruggs, who serves the Portland, Oregon, and southwest Washington State markets, outlined a direct contracting program developed with employers in those areas that he is trying to bring to all 50 states. “It’s a massive savings for these employers,” Scruggs said, often 50% of the cost of treatment that had been $100,000; for higher-cost drugs like pembrolizumab, the savings are larger.

Typically, he said, this level of savings allows the employer to eliminate cost sharing for patients, who are likely already missing time from work and opportunities for raises or bonuses. Recent evidence shows that patients experiencing financial toxicity are less likely to stick with their medication regimen; thus, removing these burdens can improve outcomes.

Insurer perspectives. Michael Diaz, MD, president and managing physician of Florida Cancer Specialists and Research Institute led the next panel, “Insurer Perspectives on Oncology Reform Efforts and New Payment Models,” which featured:

  • René Frick, senior director, Network Innovation & Partnerships, BlueCross BlueShield (BCBS) of South Carolina,
  • Stacie Mason, provider partner principal, Provider Relations, BCBS of Minnesota, and
  • Ray Parzik, senior director, Value Based Contracting, Florida Blue

Frick repeated a warning heard throughout the COA Payer Exchange Summit: Some value-based models, including those unveiled by the Center for Medicare and Medicaid Innovation (CMMI), may be too risky for small practices that are essential to care delivery in rural areas. This was true of the OCM, and oncologists have warned that the successor model, the Enhancing Oncology Model (EOM), poses even greater risk to small practices.

CMMI encouraged commercial plan participation in the OCM, and Frick said BCBS of South Carolina was able to adjust its model, “but we didn’t do shared savings.”

Today, she explained, the insurer’s partnerships with practices revolve around monthly care coordination fees, which can rise or fall at predetermined intervals based on both internal benchmarks and comparisons to peer practices. Ten practices participate and are evaluated based on 6 cancer types every 6 months, Frick said.

Mason said Minnesota Oncology asked BCBS of Minnesota to enter a value-based arrangement, which took a few years to complete. Like the South Carolina agreement, the agreement covers care coordination—in this case, for both commercial and for Medicare Advantage. It has both fee-for-service and total cost of care components. As Mason explained, the agreement covers 2 distinct types of risk scenarios and spells out the conditions for shared savings.

As is the case in South Carolina, there are elements for data sharing, which helps BCBS of Minnesota with vendor selection and quality measurement. But there remain elements that are challenging to reconcile.

“We believe this is a learning opportunity for both of us,” Mason said. “We've seen this relationship as something that will evolve over time, and so we are working together to see what works.”

Frick was candid that BCBS of South Carolina applied for the EOM largely at the urging of Kashyap Patel, MD, the current COA president who is CEO of Carolina Blood and Cancer Care Associates, a small practice based in Rock Hill, South Carolina. The insurer’s relationship with Patel is clearly a component in its willingness to explore the workability of the EOM, despite concerns about the model’s reporting requirements.

Parzik traced the history of Florida Blue’s foray into value-based oncology agreements, which started with the "just do it” mentality of CEO Patrick Geraghty in 2010 and led to the first agreement with Advanced Medical Specialties of South Florida. From there, Florida Blue executed dozens of agreements, learning more about what worked. The agreement with Florida Cancer Specialists (FCS), reached in 2016, marked a milestone in the plan’s design. The 2 sides announced an update earlier this year that found an 18% reduction in health care spending and a 22% decline in emergency room visits in the agreement’s fourth year.

Over time, Parzik said, the FCS agreement added measures of downside risk. “When we did it in a thoughtful way, we were well aware that downside risk is not a one size fits all approach,” Parzik said. Independent oncologists and hospitals do not have the same structures for taking on risk, and this must be recognized. He said the need for a “collaborative spirit” is essential to take on any such agreement—there must be trust when the 2 sides are sharing data bidirectionally and working to understand complex issues in cancer staging and genomics.

“We want to make sure what we’re doing is accurate and fair,” he said.

Mason agreed that trust is essential for insurers to pursue agreements with practices. “It's been important that it be something that where you have a partner, and you are willing to take leaps together, to be honest to lay your cards on the table,” she said. “That's really, really important.”

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