Oncology Payers Issue 1 September 2014

Oncology Payers Copyright Š 2013 Good Health (Doctors.MD). All rights reserved

PUBLISHER Nahida Zaman

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MANAGING EDITOR Seun Moses Abimbola

Alan G. Adler

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CONTENTS 6 Trends from the Field – Use of Clinical Guidelines – Which Ones? – Role of NCCN C. Lyn Fitzgerald, M.J., Joan McClure, M.S., and Robert W. Carlson, M.D 10 Preparing for the Affordable Care Act – How Cancer Centres are Preparing for the Affordable Care Act Tracy E. Spinks, B.B.A., Ronald S. Walters, M.D., Belen Fraile, M.D., Janene Culumber, M.Acc., Mark Moreno, B.A., and Thomas W. Feeley, M.D 14 Hospital Outpatient Infusion Services: Results of the National Oncology Benchmark study

Teri U. Guidi, MBA, FAAMA 18 Oncologist – Hospital Alignment in the Era of Health Reform Ronald Barkley, M.S., J.D 26 Defining the Value of Proton Therapy Using Time-Driven Activity-Based Costing Nikhil G. Thaker, M.D., Alexis B. Guzman, M.B.A., Thomas W. Feeley, M.D., Tiffany M. Jones, DrPH, James R. Incalcaterra, Ph.D., Christian Kolom, M.B.A., LaToi S. Tatum, MHA, Ronald S. Walters, M.D., M.B.A., MHA, Scott B. Cantor, Ph.D., David I. Rosenthal, M.D., Adam S. Garden , M.D., Gary B. Gunn, M.D., Clifton D. Fuller, M.D., Ph.D., Matthew B. Palmer, M.B.A., Steven J. Frank, M.D 34 Oral Agents in Colorectal Cancer: Perspectives for Patients, Providers, and Payers Nisha A. Mohindra, M.D., Sheetal M. Kircher, M.D., M.S., Halla Nimeiri, M.D., and Al B. Benson, III, M.D., FACP, FASCO 40 The 340B Program's Vital Role in Oncology Care Robert Chapman, M.D., and William Wood, R.Ph

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TRENDS FROM THE FIELD Use of Clinical Guidelines – Which Ones? – Role of NCCN ABSTRACT

C. Lyn Fitzgerald, M.J.,

The NCCN Guidelines have seen extraordinary adoption and continuously increasing utilization by multiple stakeholders – all for the benefit of patients with cancer. Maintaining and increasing the relevance of the NCCN Guidelines is essential to NCCN achieving its mission. NCCN develops resources that present valuable information to the numerous stakeholders in the health care delivery system. As the arbiter of high-quality cancer care, NCCN promotes the importance of continuous quality improvement and recognizes the significance of creating clinical practice guidelines appropriate for use by patients, clinicians, payers, and other health care decision-makers.

Furthermore, NCCN recognizes factors that have contributed to the wide-spread trust and adoption of the NCCN Guidelines and is committed to maintaining its firewall, transparent processes and the quality, timeliness and availability of its resources.

Robert W. Carlson, M.D.

Joan McClure, M.S., and

From the National Comprehensive Cancer Network, Fort Washington, Pennsylvania (C.L.F., J.M., R.W.C.); Fox Chase Cancer Center, Philadelphia, Pennsylvania (R.W.C.); and Stanford University Medical Center, Stanford, California (R.W.C.).

Submitted April 22, 2014; revised May 12, 2014; accepted May 7, 2014.

Keywords:

oncology; guidelines; cancer; compendium; payers; physicians Corresponding author: C. Lyn Fitzgerald, M.J., National Comprehensive Cancer Network, 275 Commerce Drive, Suite 300, Fort Washington, Pennsylvania 19034 (fitzgerald@nccn.org).

Conception & design: C. Lyn Fitzgerald, M.J., Joan McClure, M.S., and Robert W. Carlson, M.D. Collection & assembly of data: C. Lyn Fitzgerald, M.J. Data analysis & interpretation: C. Lyn Fitzgerald, M.J. and Robert W. Carlson, M.D. Manuscript writing: C. Lyn Fitzgerald, M.J., Joan McClure, M.S., and Robert W.

• NCCN has developed a unique comprehensive set of clinical practice guidelines across the continuum of cancer care to assist health-care professionals and patients in making clinical decisions in cancer care.

• The NCCN Clinical Practice Guidelines are evidence-based consensus clinical practice guidelines covering over 97% of all patients living with cancer.

• The NCCN Guidelines are continuously updated and widely recognized as the standard for clinical care and policy in oncology in the United States and are used in both the academic and community setting.

• NCCN maintains a strict financial firewall around its transparent Guidelines development process.

• NCCN Guideline derivatives, such as the NCCN Drugs & Biologics Compendium (NCCN Compendium®), provide easy-to-use resources for multiple stakeholders, such as payers and employers.

• The NCCN Compendium, based directly on the recommendations contained in the NCCN Guidelines, is designed to support decisionmaking about the appropriate use of drugs and biologics in patients with cancer and is the most widely used compendium by payers and providers and has been recognized by the Centers for Medicare and Medicaid Services (CMS) since 1998.

• NCCN works with commercial entities such as employers and health information technology vendors to create NCCN Guideline derivatives to support clinical decision making in cancer care.

Carlson, M.D.

Final approval of manuscript: C. Lyn Fitzgerald, M.J. and Robert W. Carlson, M.D. 10.13032/tjop.2052-5931.100095

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The National Comprehensive Cancer Network® (NCCN®) is a not-for-profit alliance of 25 of the world’s leading cancer centers devoted to patient care, research, and education. NCCN has developed a comprehensive set of clinical practice guidelines across the continuum of cancer care to assist healthcare professionals and patients in making clinical decisions in cancer care. The current set of NCCN Clinical Practice Guidelines (NCCN Guidelines®) is evidence-based consensus clinical practice guidelines covering over 97% of all patients living with cancer.

The NCCN Guidelines® are widely recognized as the standard for clinical care and policy in oncology in the United States and are used in both the academic and community setting.

Clinical practice guidelines provide evidence-based recommendations in an effort to improve quality of care and to optimize care across specialties.1,2 Providers are regularly faced with difficult decisions and uncertainty when treating patients,1 and attitudes toward guidelines are positive.2 Clinical practice guidelines are an important tool in improving clinical decision-making and are an essential foundation of efforts to effectively improve care.3,4 Moreover, physicians report that they often agree with guideline recommendations.2 The first NCCN Guidelines® were published in November 1996 covering breast, colon, lung, ovarian, pediatric, prostate, and rectal cancers to provide guidance in making the difficult clinical decisions inherent to cancer care.5 The NCCN Guidelines remain unique in providing recommendations across the continuum of care and being written in a graphic manner (Fig. 1). This graphic or algorithmic presentation makes the NCCN Guidelines clinically intuitive and easy to use at point-of-care. The NCCN Guidelines have seen extraordinary adoption and continuously increasing utilization. NCCN works to provide easy access to NCCN Guideline recommendations. In 2001, the NCCN Guidelines were published on the NCCN website (NCCN. org) for free use by clinicians to support the care of cancer patients. There are now 59 NCCN Guidelines that cover prevention, screening, diagnosis, active therapy (including related biomarker recommendations), supportive and palliative care, and survivorship. Multiple Guidelines derivatives support the use by multiple stakeholders of information in various formats and all for the benefit of patients with cancer.

NCCN GUIDELINES DEVELOPMENT The NCCN Guidelines are developed and continuously updated by 47 multi-disciplinary panels, comprised of more than 1000 disease-specific, sub-specialist, expert clinicians/ investigators from the Member Institutions and patient advocates. The NCCN Guidelines development process begins with consideration of the need for a new guideline 4

"Nearly 28,000 managed care medical directors, pharmacy benefits directors, and other health-care professionals access the NCCN Compendium via subscription on the NCCN website."

by the Guidelines Steering Committee; upon approval, a chair, vice chair, multidisciplinary panel members from the Member Institutions and NCCN staff are selected.

NCCN staff in collaboration with the panel leadership review the evidence and an agenda is developed. Assigned panel members review and present data on each issue, and all panel members discuss the data and make recommendations based on the effectiveness and safety of each intervention considering the quantity, quality, and consistency of the data. The panel votes on recommendations and a category of evidence, which evaluates the level of evidence supporting the recommendation and the extent of agreement among the panel members (Table 1), is assigned. An algorithm following the steps in clinical decision-making across the continuum of care is created and the discussion section and references to explain the recommendations are developed by NCCN staff and published after final approval by the panel.

The update cycle begins with the identification of new scientific evidence and an annual Institutional review where the Guideline is circulated for comment among the multidisciplinary faculty at each Member Institution.6 Scientific data submissions from entities or individuals external to NCCN are also accepted for review.

Each Guidelines panel meets at least annually, in person or via teleconference to continuously assure that the recommendations are current and state-of-the-art cancer care; the panels consider potential modifications through a review and discussion of the evidence available including the quality, extent, and consistency of the evidence. A formal vote is taken on all changes and a category of evidence is assigned.

Once modifications are identified, the NCCN Guideline is updated and the algorithms and a manuscript describing the rationale for the recommendations are published on NCCN. org – and the process begins again (Fig. 2).

The NCCN Guidelines development process is transparent. NCCN publishes its transparency process and recommendations on NCCN.org including minutes from the panel meetings, references for the most significant evidence considered for a modification, a tally of the panel member votes for each change, panel attendance, and panel disclosures.

External data submissions are also published.

MINIMIZATION OF BIAS NCCN maintains a strict firewall around the Guidelines development process and does not accept any form of industry or other external financial support for the Guidelines development program. The Guidelines are supported exclusively by Member Institution dues.7 The Guideline Panel members are volunteers and are not compensated for their participation, including more than 20,000 hours in 2012.

The NCCN has a formal and transparent conflict of interest policy8 in place to minimize the potential for intentional or unintentional bias in the NCCN Guideline development process. In addition to strictly maintaining the NCCN HTTP://OPPP.US

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88% felt that guidelines were unbiased.2 Indeed the NCCN Guidelines are consistently ranked first by oncologists when asked which guidelines they use frequently for making treatment decisions.12 In response to a 2013 NCCN Guidelines User Survey with 2277 physician respondents, the vast majority strongly agreed or agreed that the NCCN Guidelines are evidence-based (95%), objective and balanced (92%), and up-to-date (96%). These physicians also find the NCCN Guidelines to be helpful in teaching (91%), a reliable reference tool (97%) and useful in patient education (92%).

Significantly, the majority of physician respondents in the United Sates (85%) reported that they use the NCCN Guidelines for patient care decision-making.

The Survey found that the NCCN Guidelines are also helpful in discussion with Managed Care organizations (79%) and to inform policy in a managed care organization (74%).14 A recent study commissioned by Pharmaceutical Research and Manufacturers of America (PhRMA), the Biotechnology Industry Organization (BIO), and the Association of Community Cancer Centers (ACCC) found that oncology practices are turning to guidelines more often to inform their decisions regarding off-label use, in part, because off-label use requires and will continue to require strong clinical evidence to support coverage and reimbursement.15

FIGURE 1. NCCN GUIDELINES ALGORITHM.

NCCN GUIDELINE DERIVATIVES

FIGURE 2. NCCN GUIDELINES DEVELOPMENT PROCESS.

Firewall,9 the conflict of interest policy requires that all NCCN Panel members and staff disclose their financial conflicts of interest verbally at each panel meetings and in written documents that are publically available on NCCN.org.10,11 Panel members with meaningful financial conflicts of interest are excluded from participating in NCCN Guideline development where the conflict exists.

Potential panel members with substantial financial relationships with potentially interested parties are excluded from participating in any NCCN Guideline panel.

NCCN GUIDELINE UTILIZATION There are more than a half million registered users of the NCCN Guidelines on NCCN.org. There have been more than 25 Million downloads of the NCCN Guidelines on NCCN.org since 2006, including nearly 5 Million downloads in 2013 – a 15% increase in volume over 2012. The average annual increase in volume of downloads has been nearly 37% since 2006.

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The increased utilization of the NCCN Guidelines is consistent with the proliferation of guidelines pertaining to cancer management.12 In a recent survey, 111 oncologists were asked if they used cancer treatment guidelines. In 2012, 69.8% reported using guidelines, up 17% from 59.5 % in 2009.

Nearly 76% reported that they used the NCCN Guidelines, the second most utilized were those published by ASCO at 56.9 %.13 A study published in 2014 surveyed 766 oncologists and surgeons who treat breast cancer regarding guidelines in general and the NCCN Guidelines in particular. Nearly all oncologists (96 %) and most surgeons (70%) reported that the NCCN Guidelines generally influence their cancer management decisions; only 1% of oncologists and 9% of surgeons reported that no guidelines influenced their cancer management decisions.2 Nearly all (96%) of the physicians surveyed reported often agreeing with NCCN recommendations, and nearly all agreed that guidelines were good educational tools, convenient, and intended to improve the quality of care, and

Derivatives of the NCCN Guidelines provide easyto-use resources for multiple stakeholders, such as payers and employers. The NCCN Drugs & Biologics Compendium (NCCN Compendium®) is based directly on the recommendations contained in the NCCN Guidelines and is designed to support decision-making about the appropriate use of drugs and biologics in patients with cancer.

The NCCN Compendium® is the most widely used compendium by payers and providers and has been recognized by the Centers for Medicare and Medicaid Services (CMS) since 1998.16–18 CMS has stated that the recognition was important because the ever-expanding industry of drug treatments is dynamic and requires the constant monitoring and assessment of new interventions.19 Nearly 28,000 managed care medical directors, pharmacy benefits directors, and other health-care professionals access the NCCN Compendium via subscription on the NCCN website. Others access through technologies intergraded for use at point-of-care or for use when making decisions that impact patient access to appropriate therapy. All recommendations in the NCCN Compendium are derived from the NCCN Guidelines and constitute appropriate, medically necessary care. The NCCN Compendium lists both FDA-approved uses and appropriate uses beyond the FDA-approved label.

The National Business Group on Health (NBGH) represents Fortune 500 companies that purchase and provide health coverage for more than 50 million US workers, retirees, and their families. According to NBGH, the cost of cancer treatment is typically among the top three conditions, on average, 12% of total medical expenses for employers. In addition, cancer is also one of the leading causes of both short- and long-term disability. In 2010, NBGH collaborated with NCCN to create a comprehensive 5

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Category 1: Based upon high-level evidence, there is uniform NCCN consensus that the intervention is appropriate.

Category 2A: Based upon lower-level evidence, there is uniform NCCN consensus that the intervention is appropriate.

Category 2B: Based upon lower-level evidence, there is NCCN consensus that the intervention is appropriate.

Category 3: Based upon any level of evidence, there is major NCCN disagreement that the intervention is appropriate.

TABLE 1. NCCN CATEGORIES OF EVIDENCE.

NCCN also works with commercial entities to license NCCN clinical content to create health information technology derivatives, such as mobile applications and clinical decision-assist tools; the NCCN content is licensed for integration or as a reference. NCCN, including NCCN Guidelines Panel members, is working with McKesson Specialty Health to create Value Pathways Powered by NCCN™, a pathways product which is concordant with the NCCN Guidelines. Additionally, some other commercial pathways utilize NCCN content as a reference among other references for the creation of their pathways. NCCN maintains a list of official licensees of NCCN content on NCCN.org. NCCN recognizes the essential role of health information technology and is actively working toward digitization of the NCCN Guidelines for ease of integration.

AUTHORS’ DISCLOSURES OF POTENTIAL CONFLICTS OF INTEREST The authors are all fulltime employees of the National Comprehensive Cancer Network.

CONCLUSIONS set of tools, which include recommendation from the NCCN Guidelines and the NCCN Compendium to help employers meet this challenge. The three-year project was led by a 35-member multi-disciplinary national advisory committee and culminated with the launch of the Employer’s Guide to Cancer Treatment and Prevention in late November 2013; this Guide is publically available online.20 Other NCCN Guidelines’ derivatives include the NCCN Chemotherapy Order Templates®, the NCCN Biomarkers Compendium®, The NCCN Guidelines for Patients®, and foreign translations and regional adaptations of the NCCN Guidelines for use outside of the United States. Like with NCCN Compendium, these derivatives are resources, consistent with the NCCN Guidelines, formatted for easeof-use by providers, payers, and patients.

Maintaining and increasing the relevance of the NCCN Guidelines is essential to NCCN achieving its mission, which is as an alliance of leading academic cancer centers devoted to patient care, research, and education, to improve the quality, effectiveness, and efficiency of cancer care so that patients can live better lives. NCCN will continue to develop resources that present valuable information to the numerous stakeholders in the health-care delivery system. As the arbiter of high-quality cancer care, NCCN promotes the importance of continuous quality improvement and recognizes the significance of creating clinical practice guidelines appropriate for use by patients, clinicians, payers, and other health-care decision-makers. Furthermore, NCCN recognizes factors that have contributed to the wide-spread trust and adoption of the NCCN Guidelines and is committed to maintaining our firewall, our transparent processes, and the quality, timeliness and availability of our resources.

REFERENCES 1. Institute of Medicine. Clinical Practice Guidelines We Can Trust. March 23, 2011. http://www.iom.edu/Reports/2011/Clinical-Practice-Guidelines-We-Can-Trust.aspx. Accessed April 1, 2014.

2.

Jagsi R, Huang G, Griffith K, et al. Attitudes toward and use of cancer management guidelines in a national sample of medical oncologists and surgeons. J Natl Compr Canc Netw. 2014;12:204–212.

3. Eccles MP, Grimshaw JM, Shekelle P, Schünemann HJ, Woolf S. Developing clinical practice guidelines: target audiences, identifying topics for guidelines, guideline group composition and functioning and conflicts of interest. Implement Sci. 2012;7:60.

4.

Anonymous. Community Oncology Alliance: Oncology Medical Home. http://www.medicalhomeoncology.org/. Accessed April 4, 2014.

5. Winn RJ, Botnick WZ. The NCCN guideline program: a conceptual framework. Oncology (Williston Park). 1997;11(11A):25–32.

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Anonymous. NCCN Guidelines ® and Derivative Information Products: User Guides. 2014. http://www.nccn.org/professionals/default.aspx.Accessed April 4, 2014.

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Anonymous. NCCN Clinical Practice Guidelines Firewall Policy. 2013. http://www.nccn.org/about/pdf/nccn_firewall_policy.pdf. Accessed April 3, 2014.

8. Anonymous. About NCCN: NCCN Disclosure Policies and Potential Conflicts of Interest. 2014. http://www.nccn.org/about/disclosure.aspx. Accessed April 8, 2014.

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Anonymous. NCCN Clinical practice Guidelines Firewall Policy. 2013. http://www.nccn.org/about/pdf/nccn_firewall_policy.pdf. Accessed April 3, 2014.

10. Anonymous. NCCN Guidelines® & Clinical Resources: NCCN Guidelines Development Conflict of Interest Principles. 2014.

http://www.nccn.org/professionals/physician_gls/conflicts_policy.asp. Accessed April 8, 2014.

11. Anonymous. About NCCN: NCCN Disclosure Policies and Potential Conflicts of Interest. 2014. http://www.nccn.org/about/disclosure.aspx. Accessed April 8, 2014.

12. Dillmon M, Goldberg JM, Ramalingam SS, Mayer, RJ, Loehrer P, Van Poznak C

Clinical practice guidelines for cancer care: utilization and expectations of the practicing oncologist. J Oncol Pract. 2012;8:350–353.

13. Anonymous. The 2013 Genentech Oncology Trend Report: Perspectives From Managed Care, Specialty Pharmacy Providers, Oncologists, Practice Mangers, and Employers. 5th ed.

South San Francisco CA: Genentech; 2012.

14. Anonymous. NCCN Guidelines User Survey. October 17, 2013.

15. Boston Healthcare Associates, Inc. Impact of Payer Coverage and Reimbursement Policies on Off-label Use of Anticancer Therapies. October 18, 2013.

http://www.accc-cancer.org/advocacy/pdf/2013-Off-LabelSurvey-Report.pdf. Accessed April 4, 2014.

16. Xcenda. Payer-Pulse Web Survey. May 2012. http://www.xcenda.com/Insights-Library/Payer-Perspectives/Payer-Perspectives-on-the-Role-of-Compendia-in-Patient-Access/. Accessed April 4, 2014.

17. Boston Healthcare Associates, Inc. Impact of Payer Coverage and Reimbursement Policies on Off-label Use of Anticancer Therapies. October 18, 2013.

http://www.accc-cancer.org/advocacy/pdf/2013-Off-LabelSurvey-Report.pdf. Accessed April 4, 2014.

18. Anonymous. The 2013 Genentech Oncology Trend Report: Perspectives from Managed Care, Specialty Pharmacy Providers, Oncologists, Practice Mangers, and Employers. 5th ed.

South San Francisco CA: Genentech; 2012.

19. Anonymous. Medicare updates its list of recognized sources to help make coverage decisions for anti-cancer chemotherapy drugs. June 5, 2008. http://www.cms.gov/apps/media/press/release.asp?Counter=3145&intNumPerPage=10&checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&keywordType=All&chkNewsType=1%2 52C+2%252C+3%252C+4%252C+5&intPage=&showAll=&pYear=&year=&desc=fa Accessed April 9, 2014.

20. Emerman, E. National Business Group on Health Unveils an Employer’s Guide to Cancer Treatment and Prevention. November 20, 2013.

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http://www.businessgrouphealth.org/pressroom/pressRelease.cfm?ID=221. Accessed April 2, 2014.

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PREPARING FOR THE Affordable Care Act How Cancer Centers are Preparing for the Affordable Care Act ABSTRACT

Tracy E. Spinks, B.B.A.,

Objectives The Patient Protection and Affordable Care Act of 2010 contains several provisions that will benefit patients living with or at risk for cancer. However, implementation of many provisions is early, and little is known of the challenges of preparing for and implementing these provisions in the cancer setting.

Belen Fraile, M.D.,

Study design We selected for review four provisions of the Affordable Care Act that are relevant to cancer care: access to cancer care; new reimbursement models – value-based purchasing and episode-based payments; new delivery models – Accountable Care Organizations and PatientCentered Oncology Medical Homes; and quality reporting.

Massachusetts (B.F.); and

Methods We described each provision as it relates to cancer, the initial implementation challenges observed, and the activities of the free-standing cancer centers to prepare for implementation of these provisions.

10.13032/tjop.2052-5931.100096

Results Patients’ ability to obtain health insurance has improved; however, network adequacy remains an issue. Additionally, early adopters of new reimbursement and delivery models have observed modest improvements and, in certain cases, disappointing results. Many challenges relate to data availability and program design.

Finally, much work remains to develop a robust cancer quality measurement program and to publicly report that information in a way that informs patient decision-making.

Belen Fraile

Conclusions The Affordable Care Act reflected idealistic goals to improve the accessibility, affordability, and quality of cancer care throughout the nation. Some progress has been made, but many challenges remain. Close collaboration between providers, payers, and policymakers and thoughtful design are needed to advance toward the value-based cancer care delivery system envisioned in the Affordable Care Act.

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Ronald S. Walters, M.D., Janene Culumber, M.Acc., Mark Moreno, B.A., and Thomas W. Feeley, M.D. From the MD Anderson Cancer Center, The University of Texas, Houston, Texas (T.E.S., R.S.W., M.M., T.W.F.); Dana-Farber Cancer Institute, Boston, Moffitt Cancer Center, Tampa, Florida (J.C.).

Submitted May 1, 2014; Accepted May 13, 2014 Keywords: Affordable Care Act; value-based cancer care; access; quality reporting

Conception and design: Thomas W. Feeley; Tracy E. Spinks; Ronald S. Walters; Mark Moreno;

Collection & assembly of data: N/A Data analysis & interpretation: N/A Manuscript writing: Tracy E. Spinks; Ronald S. Walters; Belen Fraile; Janene Culumber; Mark Moreno; Thomas W. Feeley Final approval of manuscript: Tracy E. Spinks; Ronald S. Walters; Belen Fraile; Janene Culumber; Mark Moreno; Thomas W. Feeley

The Patient Protection and Affordable Care Act of 2010 (ACA) addressed cancer in a number of important areas including: •P rohibition against coverage denials and higher insurance premiums for patients with pre-existing conditions; •E limination of insurer-imposed lifetime or annual dollar limits on essential health benefits, including screening and prevention services; • I ncreased coverage for smoking cessation, weight control programs, and early detection services, such as mammography, and waiving deductibles for colon cancer screening; •M andatory coverage of routine costs of care for patients on clinical trials; • Mandatory tax on indoor tanning facilities; •P iloting new delivery and reimbursement models including episode-based payments, Accountable Care Organizations, and Patient-Centered Medical Homes; and •C reation of the Patient-Centered Outcomes Research Institute (PCORI) to measure and study comparative effectiveness, with a specific emphasis on patient preferences.1 Together, these provisions will significantly benefit patients living with or at risk for cancer. As such, the nation’s freestanding cancer centers (“Cancer Centers”) – 11 National Cancer Institute-, or NCI-, designated Comprehensive Cancer Centers with a singular focus on cancer2,3 – are closely following the implementation of the ACA provisions that are relevant to cancer.

As the Cancer Centers prepare for the future, there are a number of provisions in the bill that are problematic – either as written or as initially implemented. Efforts to increase access have been complicated by the Supreme Court’s Medicaid expansion ruling. Additionally, new reimbursement models only indirectly address cancer care, and new delivery models do not apply directly to the Cancer Centers.

Moreover, the quality reporting requirements, while idealistic, are proving difficult to achieve. In this paper, we examine these difficulties and describe the Cancer Centers’ efforts to prepare for the implementation of various ACA provisions.

ACCESS TO CANCER CARE Recent estimates from the Congressional Budget Office suggest that the ACA will expand insurance coverage to an estimated 25 million previously uninsured, nonelderly Americans by 2016.4 Together with the provisions described above that are aimed at eliminating coverage denials for preexisting conditions and limits on essential health benefits, this coverage expansion has the potential to improve access for many cancer patients. However, insured status alone is insufficient to guarantee access to high-quality cancer care.

Historically, insurers have exercised 2 major cost control mechanisms – limiting access to care through narrower 7

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provider networks and reducing utilization through preauthorization of hospital admissions and surgeries and, more recently, radiation therapy, diagnostic imaging procedures, and chemotherapy. The ACA requires exchanges to ensure network adequacy among qualified health plans.

Several organizations have provided guidance in this area, highlighting the importance of a patient-centered approach and the need for access to centers of excellence for medically intensive services.5,6 As recently as March 2014, questions regarding network adequacy continue, and insurance beneficiaries are experiencing difficulty in accessing specialty care providers.7,8 A recent Milliman report commissioned by the Leukemia and Lymphoma Society noted that the lack of “in-network” NCI-designated cancer centers was alarming among insurance exchanges in 4 states (California, New York, Florida, and Texas) that are home to 7 of the 11 free-standing cancer centers.9 States, such as Massachusetts, have enacted legislation to protect access to specialty care, including oncology, for subscribers of limited and tiered network plans.10 The Cancer Centers are closely monitoring activities in state- and federal-based exchanges to better understand and respond to patient access challenges and obstacles. Many Cancer Centers have also engaged state and federal regulators and national organizations with mutual interests to discuss options and opportunities to address network adequacy for cancer services.

NEW REIMBURSEMENT MODELS – VALUE-BASED PURCHASING AND EPISODE-BASED PAYMENTS The ACA authorized new reimbursement models – valuebased purchasing (VBP) and episode-based payments (EBP) – designed to incentivize and align reimbursement with integrated, efficient, and high-quality care delivery. These payment models are described below.

Value-based Purchasing The ACA outlined VBP programs for hospitals and physicians, intended to increase transparency and quality of care while reducing Medicare spending. The Cancer Centers are excluded from the VBP program for acute care hospitals.

The ACA authorized a separate VBP pilot for the Cancer Centers (to begin by January 1, 2016), but provided minimal direction regarding implementation. The Cancer Centers are examining other VBP programs to understand how a VBP pilot might be implemented for their hospitals, and preliminary findings suggest important lessons. For example, investigators have observed a lack of well-defined short-, intermediate-, and long-term goals in existing VBP programs.

Typically, these programs have ambitious, but vague, goals related to cost containment and quality improvement. Experts recommend broadening VBP goals to promote organizational agility and innovation and adopting goals with greater specificity.11 Similarly, a “top down” approach to quality measurement, emphasizing long-term and patient-centered outcomes, will improve alignment between outcomes and reimbursement while managing the quality measurement burden under the program.

Episode-based payments Episode-based payments or payment bundles provide a single 8

"The ACA reflected ambitious goals and has eliminated or reduced many access barriers to cancer care, innovative clinical trials, and cancer prevention services."

payment for all services related to a specific condition or treatment. Various EBP models exist, with more narrowly scoped models applying to a single provider or care setting, while other models span multiple providers and care settings.

Recent models incorporate quality performance targets and are being piloted in public and private sectors. The success of these models is untested in terms of improved care coordination, outcomes, and efficiency. Preliminary findings suggest some cost reductions, together with disappointing findings – consistent evidence of shifting of services between care settings and no major effect on quality.11 Early implementation challenges relate to bundle scope and payment methodology, quality measurement, provider attribution and engagement, and care delivery redesign.12 These challenges would be amplified in oncology, where diagnosis, treatment, and follow-up traverse months – even years – of care from multiple providers across care settings.

Early efforts to model and pilot EBP in oncology have uncovered potentially serious implementations challenges and raised concerns about scalability, highlighting the need for strong clinical and administrative integration.13,14 These findings suggest that successful implementation in oncology will require real-time access to cost, quality, utilization, access, and care coordination data. Additionally, robust, cancerspecific quality measures, including overuse, underuse, access, timeliness, and patient-reported outcomes, must be integrated into oncology bundles to ensure high-quality care.

While federal VBP and EBP initiatives for cancer care are in the early stages, the Cancer Centers have engaged with federal agencies to better understand the implementation plans. Several Cancer Centers have also interacted with organizations and providers already affected by these programs – through earlier ACA implementation – for purposes of planning, assessment, and evaluation of risks and opportunities for improvement.

NEW DELIVERY MODELS – ACCOUNTABLE CARE ORGANISZATIONS AND CANCER MEDICAL HOMES A major goal of the ACA was to authorize new health-care delivery models, including Accountable Care Organizations (ACO) and Patient-Centered Medical Homes (PCMH), designed to improve health-care quality and safety, while reducing costs for Medicare beneficiaries. Although their adoption is moving at a slower pace for oncology than for other medical conditions, some oncology-specific models are starting to appear across the nation, as described below.

Accountable Care Organizations Currently, the Cancer Centers are ineligible to participate in a traditional ACO with the Centers for Medicare & Medicaid Services (CMS). However, the Moffitt Cancer Center (Moffitt) is piloting an oncology ACO-like model with a private payer. Through this model, the parties retain the attractive elements of an ACO – collaborating to improve quality, reduce costs, promote care coordination, and improve adherence to Moffitt’s proprietary clinical pathways – without the traditional ACO risks. Both parties benefit from cost efficiencies under a shared savings arrangement.

In its first year of operation, Moffitt has noted successes and lessons learned. Selected programs have shown improved HTTP://OPPP.US

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pathway adherence, and patients have offered positive feedback regarding care coordination. Many challenges are data-related. For example, the process for attributing patients to the ACO was intended to isolate patients in active treatment. However, a preliminary analysis has shown that, for certain diagnoses, the attribution methodology is including patients receiving follow-up care. Moffitt and the payer are working to refine the attribution methodology.

Additionally, the pilot is generating data that are rich with information, but the analysis is complex and time-consuming.

Moffitt is developing standard models by cancer diagnosis to streamline the data analysis.

Patient Centered Oncology Medical Home The Patient-Centered Oncology Medical Home (PCOMH) has been piloted in the community setting, as a method of high-value cancer care delivery. Similar to the PCMH,15 the PCOMH provides comprehensive, coordinated, and patient-centered oncology services. It focuses resources around clinical pathway adherence, care coordination, patient self-management, after-hours access, quality reporting, and performance improvement.16 Early pilot results have shown reduced downstream costs for emergency room visits, hospitalizations, and end-of-life care.17 However, there is a need to develop systematic methods for payment distribution across financially independent providers and to understand the interaction between the PCOMH and the growing – and perhaps competing – comprehensive PCMH. Because the Cancer Centers already deliver comprehensive, coordinated, and patient-centered care through a multidisciplinary care model, many of the desired qualities of a PCOMH already exist among the Cancer Centers.

Thus, the Cancer Centers are following existing PCMH demonstration projects to better understand the benefits and challenges of implementing these models in the community setting.

QUALITY REPORTING Historically, health-care reimbursement was rarely linked to quality. Medicare’s initial efforts to introduce quality reporting were implemented as pay-for-reporting programs, with payment dependent upon successful reporting of designated quality measures – first with incentives, then with penalties. Initial measure “starter sets” were selected for various payment programs. However, cancer was not a measurement focus, and the Cancer Centers generally were exempt from federal quality reporting programs.

The ACA created a new hospital-level reporting mandate specific to the Cancer Centers, implemented as the Prospective Payment System-Exempt Cancer Hospital Quality Reporting Program.18,19 It also strengthened the scope of existing physician-based quality reporting, the Physician Quality Reporting System, by applying payment

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penalties for unsatisfactory reporting and linking it to physician-based pay-for-performance, where performance against established standards affects reimbursement.20 Several organizations have contributed quality measures for these programs, including CMS, the American College of Surgeons, the American Society of Clinical Oncology, the Centers for Disease Control and Prevention, and the American Medical Association Physician Consortium for Performance Improvement. Oncology specialty societies have driven the development of most cancer quality measures, which has supported improvements in care in many cases. However, the absence of a national unified approach to measuring quality in cancer care, together with health information technology limitations, fragmented care delivery, and inadequate consideration of patients’ perspectives, has contributed to significant gaps in cancer quality measures.21 The Cancer Centers have provided input to federal policymakers on measure selection and development for their mandatory reporting program. Additionally, in 2013, several Cancer Centers field-tested quality measures developed by CMS contractors specifically for that program.

As indicated, the identification and adoption of appropriate and meaningful patient-centered outcomes is a significant challenge. The Cancer Centers, with interests aligned with other national bodies and organizations, have a deep interest in identifying, developing, and being evaluated by measures that distinguish high-value cancer care – measures with the greatest impact on patient health status and quality of life, recovery, and, ultimately, survival. Much work remains to ensure that such measures are properly reported in the public forum in a way that enables patients to make informed decisions regarding oncology providers and that helps direct them to high-value cancer care

ACKNOWLEDGMENTS This work is supported in part by the National Institutes of Health through MD Anderson’s Cancer Center Support Grant P30 CA016672 and through Moffitt’s Cancer Center Support Grant P30 CA76292.

The authors thank the Alliance for Dedicated Cancer Centers and its Executive Director R. Donald Leedy for their continuing contributions and leadership related to the implementation of provisions of the Affordable Care Act at free-standing cancer centers.

AUTHORS’ DISCLOSURES OF POTENTIAL CONFLICTS OF INTEREST The authors indicated no potential conflicts of interest.

SUMMARY During the twentieth century, America’s free-standing cancer centers emerged to improve the outcomes of cancer care in America through research-driven, patient-centered care. The ACA reflected ambitious goals and has eliminated or reduced many access barriers to cancer care, innovative clinical trials, and cancer prevention services. Additionally, the ACA attempted to make high-quality cancer care available and more affordable for all Americans through a cancer-specific quality reporting program and alternative health-care delivery and reimbursement models. Many challenges remain in making the transition from a fee-for-service reimbursement system to a system that rewards high-value cancer care.

Thoughtful design and close collaboration between providers, payers, and policymakers are necessary to successfully implement the ACA provisions that will ultimately lead to a value-based cancer care delivery system that will improve the quality of cancer care in America.

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2. The Ohio State Comprehensive Cancer Center – Arthur G. James Cancer Hospital and Solove Research Institute, Columbus, OH; City of Hope Comprehensive Cancer Center, Duarte, CA; Dana-Farber Cancer Institute, Boston, MA; Fox Chase Cancer Center, Philadelphia, PA; H. Lee Moffitt Cancer Center & Research Institute, Tampa, FL; The University of Texas MD Anderson Cancer Center, Houston, TX; Memorial Sloan-Kettering Cancer Center, New York, NY; Roswell Park Cancer Institute, Buffalo, NY; Seattle Cancer Care Alliance, Seattle, WA; Sylvester Comprehensive Cancer Center, Miami, FL; USC Norris Cancer Hospital, Los Angeles, CA 3.

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Available at: http://www.ncqa.org/Portals/0/Public%20Policy/Exchanges%26NetworkAdequacy_2.11.13.pdf. Accessed March 3, 2014.

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Available at: http://hbx.dc.gov/sites/default/files/dc/sites/Health%20Benefit%20Exchange%20Authority/publication/attachments/DC%20HBX%20Network%20Adequacy%20BackgroundPaper.pdf. Accessed March 3, 2014.

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10. Murphy JG. Utilization in Limited and Tiered Network Plans and the Health Care Needs of Children and Cancer Patients. 2013.

Available at: http://www.mass.gov/ocabr/docs/doi/healthcare-needs-children-and-cancer.pdf. Accessed May 1, 2014.

11. Damberg CL, Sorbero ME, Lovejoy SL, Martsolf G, Raaen L, Mandel D. Measuring Success in Health Care Value-based Purchasing Programs: Summary and Recommendations. 2014.

Available at: http://aspe.hhs.gov/health/reports/2014/HealthCarePurchasing/rpt_vbp_summary.pdf.

12. Hussey PS, Ridgely MS, Rosenthal MB. The PROMETHEUS bundled payment experiment: slow start shows problems in implementing new payment models. Health Aff (Millwood). 2011;30(11):2116–2124.

13. Bach PB, Mirkin JN, Luke JJ. Episode-based payment for cancer care: a proposed pilot for Medicare. Health Aff (Millwood). 2011;30(3):500–509.

14. Newcomer LN. Changing physician incentives for cancer care to reward better patient outcomes instead of use of more costly drugs. Health Aff (Millwood). 2012;31(4):780–785.

15. Agency for Healthcare Research and Quality (AHRQ). Patient Centered Medical Home Resource Center – Defining the PCMH. 2014. Available at: http://pcmh.ahrq.gov/page/defining-pcmh.

Accessed March 10, 2014.

16. Sprandio JD. Oncology patient-centered medical home and accountable cancer care. Commun Oncol. 2010;7:565–572.

17. Sprandio JD. Oncology patient-centered medical home. J Oncol Pract. 2012;8(Suppl 3):47s–49s.

18. Centers for Medicare & Medicaid Services (CMS). PPS-Exempt Cancer Hospital Quality Reporting (PCHQR) Program Overview. 2014.

Available at: https://qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier2&cid=1228772864217. Accessed April 30, 2014.

19. Spinks TE, Walters R, Feeley TW, et al. Improving cancer care through public reporting of meaningful quality measures. Health Aff (Millwood). 2011;30(4):664–672.

20. The Centers for Medicare and Medicaid Services (CMS). Physician Quality Reporting System – About PQRS. 2013.

Available at: http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/pqrs/index.html. Accessed March 10, 2014.

21. Spinks TE, Ganz PA, Sledge GW, et al. Delivering high-quality cancer care: The critical role of quality measurement. Healthcare. 2014;2(1):53–62.

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HOSPITAL OUTPATIENT INFUSION SERVICES UTILIZATION: Results of the National Hospital Oncology Benchmark Study

There is no denying that there is a trend across the country of shifting outpatient infusion services from the physician office (“community”) setting to the hospital outpatient (“HOPD”) setting. The reasons in each case vary, but the common theme is invariably financial. Independent physicians have been squeezed for years as they spend more time and effort on the business of the practice. Costs rise but reimbursements fail to keep pace.

Hospitals too are under pressure. Increasing demands by accrediting bodies create the need for armies of staff to monitor and document performance. As for physicians, costs rise but reimbursements fail to keep pace. Hospitals then seek to expand or acquire lines of business that hold the promise of offering positive margins to support all of the uncompensated work and the expense of caring for un/under-insured patients.

Infusion services hold that promise.

At the same time, there is growing attention on a variety of approaches to revamp the American health-care payment system, moving away from fee for service. Some seek to establish bundled payment models of one sort or another.

Others seek to compensate health-care providers for decreasing costs and increasing quality. Much of this attention stems from the recognition that, due to the very nature of running a hospital, care provided there is simply more costly – to patients and to payers. In terms of outpatient infusion, this begs the question of whether hospitals utilize more resources and thus generate greater expense in the delivery of these services.

In late 2013, the Oncology Management Consulting Group undertook the first of what will be an annual survey of hospital outpatient centers, the National Hospital Oncology Benchmark Study (NHOBS; The full presentation of the inaugural NHOBS may be seen at http://www. oncologymgmt.com/welcome/omc-webinars/, and the results will be published in Oncology Issues in the summer of 2014).

In addition, each year, Oncology Metrics (a division of Altos Solutions) in collaboration with the American Society of Clinical Oncology conducts a survey of community practices.

The results of this National Practice Benchmark for Oncology (NPBO) are published in The Journal of Oncology Practice1 and cover numerous metrics related to resource utilization. A comparison of staffing data points in both studies provides HTTP://OPPP.US

some insight into the differences in utilization of resources in the two settings – specifically, nursing staff for the infusion suite.

In hospitals with dedicated physicians (i.e. those who are employed or under exclusive contract, using only the hospital’s infusion suite), we see that the mean number of infusion nurses per full-time physician is 2.26.

In the community setting, NPBO data show approximately 2.25 infusion nurses per full-time physician. In these data, infusion staff is defined as all staffs responsible for drug purchasing, drug mixing and preparation, delivery to patients, documentation of services provided, and management of these processes. In the HOPD, nurses are not permitted to mix drugs and they are rarely involved in purchasing.

However, the HOPD nurses may also be responsible for administrative tasks, attendance at meetings, participation in committee work, or other tasks that are not direct patient care.

Since the NPBO data and the NHOBS data reside in separate, proprietary databases, we cannot at present compare the community setting utilization to the hospital setting utilization. However, for the HOPD, we have data that allow us to further delve into resource utilization: nursing productivity. As noted above, infusion nurses in any setting rarely spend 100% of their time directly delivering treatments. There are two ways to calculate this productivity: (1) the number of infusion encounters that one full-time infusion nurse provides in a year and (2) the number of hours spent delivering treatments. The former is a relatively straightforward analysis: the number of infusion appointments is counted (regardless of the number of injections, infusions, etc., given during the encounter) and that is divided by the number of infusion nurses. The latter is a more complex analysis that is calculated by assigning time increments to each billable procedure. For example, the first hour of a chemotherapy infusion (CPT 96413) is defined as 60 minutes. For codes that do not have a time descriptor, some assumptions were made; for example, an injection is assumed to require 15 minutes.

Here, it seems that size does matter. For small infusion centers (those with fewer than 3500 encounters per year), the mean number of encounters per infusion nurse is 438.9.

Teri U. Guidi, MBA, FAAMA From the Oncology Management Consulting Group, Pipersville, Pennsylvania Correspondence: Teri U. Guidi, MBA, FAAMA, Oncology Management Consulting Group, Pipersville, PAennsylvania (XXXXtguidi@oncologymgmt.com)

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Disease Drug

% of patients Average Drugs included in analysis receiving order/treated this drug patient

Breast

Ondansetron HCl injection Injection, pegfilgrastim 6 mg Cyclophosphamide 100 mg injection Docetaxel injection Trastuzumab injection Paclitaxel injection Doxorubicin HCl injection Palonosetron HCl Carboplatin injection Zoledronic acid Injection, fulvestrant Gemcitabine HCl injection Epoetin alfa, non-esrd Paclitaxel protein bound Vinorelbine tartrate injection

27.0 23.3 18.7 17.9 15.7 12.2 9.8 9.2 7.5 5.6 4.8 3.2 2.4 1.8 1.8

Colorectal

Fluorouracil injection Ondansetron HCl injection Oxaliplatin Leucovorin calcium injection Bevacizumab injection Irinotecan injection Levoleucovorin injection Palonosetron HCl Injection, pegfilgrastim 6 mg Cetuximab injection Granisetron HCl 1 mg oral Epoetin alfa, non-esrd Filgrastim 480 mcg injection Mitomycin injection Panitumumab injection

41.4 7.72 J2820 Sargramostim injection 35.1 8.83 J3487 Zoledronic acid 32.4 5.62 J8530 Cyclophosphamide oral 25 mg 31.4 5.86 J8700 Temozolomide 18.8 6.95 J9000 Doxorubicin HCl injection 16.4 7.72 J9001 Doxorubicin 14.7 6.13 J9002 Doxil injection 14.5 4.96 J9010 Alemtuzumab injection 10.3 3.98 J9025 Azacitidine injection 7.0 4.92 J9031 Bcg live intravesical vac 3.1 6.35 J9033 Bendamustine injection 2.0 6.91 J9035 Bevacizumab injection 1.8 3.20 J9040 Bleomycin sulfate injection 1.8 1.50 J9041 Bortezomib injection 1.8 5.50 J9043 Cabazitaxel injection

6.44 3.29 3.37 9.04 11.34 7.25 3.24 4.44 4.60 4.70 4.44 5.11 6.11 5.33 8.20

HCPCS J0640 J0641 J0881 J0885 J1440 J1441 J1626 J1950 J2353 J2354 J2405 J2430 J2469 J2505

Drug name Leucovorin calcium injection Levoleucovorin injection Darbepoetin alfa, non-esrd Epoetin alfa, non-esrd Filgrastim 300 mcg injection Filgrastim 480 mcg injection Granisetron HCl injection Leuprolide acetate/3.75 mg Octreotide injection, depot Octreotide injection, non-depot Ondansetron HCl injection Pamidronate disodium/30 mg Palonosetron HCl Injection, pegfilgrastim 6 mg

Prostate Leuprolide acetate suspension 6.1 2.56 J9045 Carboplatin injection

Zoledronic acid 4.1 4.83 J9055 Cetuximab injection

Ondansetron HCl injection 3.7 2.84 J9060 Cisplatin 10 mg injection

Docetaxel injection 3.2 7.47 J9070 Cyclophosphamide 100 mg

injection

Injection, pegfilgrastim 6 mg 1.7 2.88 J9100 Cytarabine HCl 100 mg inj

Leuprolide acetate injection 1.0 1.30 J9130 Dacarbazine 100 mg injection

Cabazitaxel injection 0.9 3.22 J9150 Daunorubicin injection

Palonosetron HCl 0.9 4.44 J9171 Docetaxel injection

Epoetin alfa, non-esrd 0.4 12.00 J9178 Injection, epirubicin HCl, 2 mg

Pamidronate disodium/30 mg 0.4 3.00 J9179 Eribulin mesylate injection

Cisplatin 10 mg injection 0.3 8.67 J9181 Etoposide injection

Leuprolide acetate/3.75 mg 0.3 1.00 J9185 Fludarabine phosphate injection

Sipuleucel-T auto CD54+ 0.3 1.33 J9190 Fluorouracil injection

Bevacizumab injection 0.2 1.50 J9201 Gemcitabine HCl injection

Etoposide injection 0.2 12.00 J9202 Goserelin acetate implant Respiratory

Ondansetron HCl injection Carboplatin injection Paclitaxel injection Palonosetron HCl Injection, pegfilgrastim 6 mg Etoposide injection Pemetrexed injection Cisplatin 10 mg injection Gemcitabine HCl injection Bevacizumab injection Zoledronic acid Docetaxel injection Granisetron HCl 1 mg oral Filgrastim 480 mcg injection Epoetin alfa, non-esrd

40.4 35.5 19.4 18.3 17.4 14.5 11.6 10.7 7.4 5.5 5.4 4.8 3.7 2.9 2.7

6.05 3.85 4.55 3.35 2.45 7.79 3.33 4.05 5.25 4.32 3.20 3.07 4.03 2.81 4.21

J9206 J9207 J9208 J9209 J9211 J9214 J9217 J9218 J9228 J9250 J9260 J9263 J9264 J9265 J9266

Irinotecan injection Ixabepilone injection Ifosfamide injection Mesna injection Idarubicin HCl injection Interferon alfa-2b injection Leuprolide acetate suspnsion Leuprolide acetate injection Ipilimumab injection Methotrexate sodium injection Methotrexate sodium injection Oxaliplatin Paclitaxel protein bound Paclitaxel injection Pegaspargase injection

All oncology Ondansetron HCl injection 33.7 7.02 J9268 Pentostatin injection patients Injection, pegfilgrastim 6 mg 15.4 3.07 J9280 Mitomycin injection

Carboplatin injection 12.7 4.11 J9293 Mitoxantrone hydrochl/5 mg

Palonosetron HCl 11.1 4.03 J9302 Ofatumumab injection

Paclitaxel injection 10.0 5.71 J9303 Panitumumab injection

Cyclophosphamide 100 mg injection 7.3 3.54 J9305 Pemetrexed injection

Docetaxel injection 6.8 8.85 J9310 Rituximab injection

Fluorouracil injection 6.3 6.94 J9315 Romidepsin injection

Rituximab injection 5.8 4.19 J9328 Temozolomide injection

Gemcitabine HCl injection 5.7 6.43 J9330 Temsirolimus injection

Bevacizumab injection 5.2 6.51 J9351 Topotecan injection

Zoledronic acid 5.1 4.65 J9355 Trastuzumab injection

Doxorubicin HCl injection 5.1 3.61 J9360 Vinblastine sulfate injection

Cisplatin 10 mg injection 5.1 4.45 J9370 Vincristine sulfate 1 mg injection

Oxaliplatin 4.7 5.25 J9390 Vinorelbine tartrate injection J9395 Injection, fulvestrant Q0162 Ondansetron oral

Q0166 Granisetron, HCl 1 mg oral

Q0169 Promethazine HCl 12.5 mg oral

Q2043 Sipuleucel-T auto CD54+

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TABLE 1. MOST FREQUENTLY ORDERED DRUGS

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Medium centers (3500–5500 encounters) average 652.7 and large centers (more than 5500 encounters) average 628.4 encounters per infusion nurse. Does this mean the small centers utilize their nursing resources less efficiently? Perhaps not, in small centers it is more likely that the nurses must perform more clerical duties than in larger centers because there is insufficient volume to afford clerical staff.

This theory also bears out in terms of the number of active hours delivering treatments. Small centers average 1181.6 hours per nurse while medium and large centers have higher productivity (1654.3 and 1446.1, respectively).

Another measure of HOPD utilization may be to examine the mix of pharmaceuticals administered. As above, comparison of the HOPD to the community setting is not yet possible but again using data from the recent NHOBS, we can determine which drugs are most frequently administered in the HOPD. In Table 1, we see the top 15 drugs administered to breast, colorectal, prostate, and respiratory cancer patients.

The ranking indicates what percentage of each patient group received the named drug as well as the average number of times per patient that the drug was ordered.

Clearly, benchmarking data offer some extremely useful information. We look forward to repeating the NHOBS annually, and we hope that one day our dataset can be more closely compared to the NPBO to gain even more knowledge between the differences in various utilization metrics.

AUTHORS’ DISCLOSURES OF POTENTIAL CONFLICTS OF INTEREST The authors indicated no potential conflicts of interest.

REFERENCES 1. T owle EL, Barr TR, Senese JL. National practice benchmark for oncology. J Oncol Pract.

2013 Nov;9(6):20S.

"The MDASI showed severe levels of nausea, vomiting, dry mouth, difficulty tasting food, and thick mucus in the mouth. Physical examination at this time revealed inflammation throughout the left side of the mouth and throat. Initial supportive care measures, including nutrition and pain management consultations, oral and intravenous medications and fluid support, were ineffective."

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ONCOLOGIST-

HOSPITAL ALIGNMENT in the Era of Health Reform ABSTRACT

Ronald Barkley, M.S., J.D.

The trend in business alignment between oncology private practice and hospital oncology services in the community setting has been a significant one during the past seven to eight years and has experienced additional impetus as a result of federal health reform mandates of the Accountable Care Act. This article explores the predominant models for business alignment among oncologists and hospitals and the impacts that health reform may have on such models.

Cancer Center Business

Development Group, Bedford, New Hampshire

Submitted May 15, 2014; revised June 2, 2014;

accepted June 2, 2014 Keywords:

oncologist hospital alignment; cancer care integration

Corresponding author: Ronald Barkley, M.S., J.D., Cancer Center Business

Development Group, 49 Perry Road, Bedford, NH

(rbarkley@ccbdgroup.com).

Conception & design:

Collection & assembly of data:

Data analysis & interpretation: Manuscript writing:

Final approval of manuscript: Ronald Barkley

10.13032/oppp.2052-5931.100004

The trend in business alignment between oncology private practice and hospital oncology services in the community setting has been a significant one during the past seven to eight years. The oncologist–hospital alignment dynamic, initially fostered by declining reimbursements coupled with concurrent increased costs of operation in the physician “office-based” setting, has experienced additional impetus as a result of federal health reform mandates of the Accountable Care Act [ACA, often referred to as “Obama Care.”

The ACA actually consists of two separate items of legislation, the Patient Protection and Affordable Care Act of 2010 (HR 3590) and the Health Care and Education Reconciliation Act of 2010 (HR 4872)].

Concerns about an uncertain future for both oncologists and hospitals under health reform mandates have sparked further interest in alignments designed to address the “triple aim” of the ACA, those aims being to: (1) improve the patients experience of care; (2) improve the health of populations; and (3) reduce per capita health-care costs.

In this article, we will first describe the predominant models of oncologist–hospital alignment and subsequently the impacts of health reform on the future of oncologist– hospital alignment initiatives.

THE “FAMILY TREE” OF ALIGNMENT MODELS Models of oncologist–hospital alignment relationships range from the informal and less aligned relationships to the more involved and advanced forms of alignment.

Included in the former (less aligned) would be such traditional relationships as medical staff privileges, physician recruitment assistance, medical directorships, multidisciplinary care collaborations, facility/equipment joint ventures, and block lease arrangements.

While these less aligned forms do achieve a certain degree of oncologist–hospital collaboration, they generally fall short of truly aligning incentives between physician and hospital interests that are required in today’s rapidly consolidating environment. Thus the evolution to the more involved and advanced forms of alignment models, which translate generally to the proposition that an oncology private practice converts its office-based services to hospital provider-based services and subsequently provides the professional services and program management of the hospital’s expanded oncology service line for a fee.

Titles attached to such relationships include professional services agreement (PSA), management services agreement (MSA), and co-management agreement (CMA). Direct employment of oncologist by hospital is considered by some to be the highest form of alignment/commitment, at least from the hospital perspective (whereas physicians often perceive hospital direct employment as a form of “surrender”

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rather than a form of alignment). And a new kid on the block, the Oncology Accountable Care Organization (ACO) involves rationalization of services between physician officebased and hospital provider-based services with a payment redesign objective that involves participation of a commercial health plan(s).

The “family tree” of alignment models is depicted in Figure 1.

DESCRIPTIONS OF THE ALIGNMENT MODELS We will provide only a cursory description of the traditional “legacy” forms of alignment relationship and then move on to a more detailed narrative on the more advanced models (PSA, MSA, CMA, Oncology ACO).

“Legacy” Alignment Relationships The granting of hospital medical staff privileges, hospital providing assistance to medical practice for physician recruitment, and paid medical directorships are examples of traditional alignment relationships between physicians and hospitals. These forms do engender a certain amount of cooperation between oncologist and hospital, but are not sufficiently involved that they can much impact the economics or care process collaboration among the parties.

Compensating a physician for his or her advisory services as a part-time medical director of a hospital department or program does result in a professional medical contribution to a program, but does not address the potential competing economic interests between the physician medical director and the hospital. If the oncology program medical director is in private practice, say with an office-based chemotherapy/ infusion service that is competitive with the hospital outpatient infusion service, the economic incentives are simply not aligned.

Multidisciplinary Care Multidisciplinary care clinics/collaborations stand for the proposition that cancer diagnosis and treatment requires an organized team approach – all disciplines represented in the full continuum of care for a particular cancer site should interact up front and during the care process such that all aspects of the patient’s diagnose and treatment are considered. Sort of like a prospective tumor board on steroids. For example, a multidisciplinary care team for a newly diagnosed breast cancer patient might include medical, radiation, and surgical oncologists and support personnel, such as genetic counselor and social worker. The “multi-D” forum can be in one physical location and/or “virtual,” with aid of telemedicine technology.

Formal, organized multidisciplinary care services tend to be sponsored by hospitals. In fact, one of the standards of accreditation for hospitals by the Commission on Cancer HTTP://OPPP.US

"While these less aligned forms do achieve a certain degree of oncologist– hospital collaboration, they generally fall short of truly aligning incentives between physician and hospital interests that are required in today’s rapidly consolidating environment."

(CoC; American College of Surgeons, Commission on Cancer Accreditation. See www.facs.org/cancer/coc) is that the hospital cancer program offers a “multidisciplinary care approach.”

While a patient-centered multi-D team approach sounds appealing, it requires a significant commitment of time on the part of participating physicians. Such physician time commitment is typically uncompensated and thus can become of limited interest to private practice physicians who can more productively utilize that time efficiently servicing patients.

In recognition of the physician time commitment requirements to effectively conduct a hospital-sponsored multidisciplinary care program, hospitals have begun to explore the application of the clinical co-management alignment model (discussed below) as an approach to compensating oncologist for participation in a hospitalsponsored multidisciplinary care program.

Facility/Equipment Joint Ventures A popular physician–hospital alignment model involves co-ownership of medical facilities and/or medical equipment by physicians and hospital. In this model, the physicians and hospital, as joint venturers, lease out the facility and/ or equipment at fair market value lease rates. Under Federal Anti-Kickback law, space or equipment lease rates associated with such ventures must be based on fair market value, fixed in advance, and not vary on the volume or value of any Medicare/Medicaid covered referrals that could be made by physician owners to the facility or equipment [42 C.F.R. Sec 1001.952 (b)-(d)]. “Per use” or “per click” fee arrangements would be impermissible. Such regulatory limitations on determining lease rates result in limited upside economic potential for straight facility/equipment leasing joint ventures, thus they are generally unappealing alignment vehicles.

An example of a facility/equipment leasing joint ventures is provided as shown in Figure 2. In this particular example, a medical oncology group practice, a radiation oncology group practice, and a hospital form a development company (joint venture) which acquires and subsequently leases to the hospital’s cancer center certain radiation and chemotherapy equipment.

Another form of oncologist–hospital joint venture is often referred to as a “clinical joint venture” or “operating joint venture,” wherein the physician and hospital owners actually share in the net income generated from a jointly owned clinical business operation.

However, where such clinical/operating joint venture involves an ownership or other financial interest by any physician in a position to refer a designated health service (DHS) to the joint venture, such entity is prohibited from submitting claims to Medicare/Medicaid for the 15

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services performed, essentially rendering such clinical joint venture economically nonviable (see generally Omnibus Budget Reconciliation Act of 1993, Pub L No.103-66 and subsequent amendments, Stark II and Stark III). Medical oncologists are considered referring physicians under Stark law and chemotherapy, radiation, imaging, and lab would be examples of prohibited DHS. Therefore, medical oncologists sharing in net income/profits generated by the operating joint venture would be an impermissible arrangement.

Interestingly, however, radiation oncologists are not considered to be referring physicians for purposes of Stark law and therefore it is not uncommon to find radiation therapy treatment services co-owned in joint venture among radiation oncologists and a hospital.

Block Lease Arrangements A block lease arrangement is one in which a health-care provider leases a set block of time of health-care facilities and/or medical equipment during which such provider has exclusive use of such facilities and/or equipment to deliver services to its patients. If the lessee of the block time is by a physician/medical group, the physician/medical group can rely on the in-office ancillary exception to Stark law for the block time. In general, the in-office ancillary exception allows a physician or physician group practice to order and provide DHS in the physician office. The block time of facility and equipment is characterized as an extension of the physicians’ office.

For example, a hospital owner of specialized radiation equipment (intensity-modulated radiation therapy – IMRT) finds that the medical equipment is being underutilized.

Radiation treatments are amenable to block scheduling of patient flow, so the hospital offers to lease the IMRT facility and equipment to an oncology group for the group’s exclusive use in the afternoons on Mondays, Wednesdays, and Fridays. The oncology group assumes possession of the facility and equipment during its reserved block lease time, performs radiation services for it patients and bills on its behalf accordingly.

Block lease arrangements can be advantageous in situations where costly plant and capital equipment is being underutilized. Refer to Figure 3 for functional diagram of a block lease arrangement.

Now we shall turn to the more involved and advanced forms of alignment models, which translate generally to the proposition of an oncology private practice providing the professional services and program management of a hospital’s oncology service line for a fee.

FIGURE 1. FAMILY TREE OF ALIGNMENT MODELS.

FIGURE 2. FACILITY/EQUIPMENT JOINT VENTURES.

Co-Management Agreement The purpose of the co-management model is to engage and to appropriately reward participating physicians for their contribution as clinical leaders in developing, implementing, co-managing, and improving quality and efficiency of a hospital’s service line.

Examples of physician duties under a CMA might include responsibility for assisting in the development and implementation and routine updating of policies and procedures and methods of operation of the cancer service line and assisting in the development and implementation of programs in response to value-based or pay for performance initiatives. A more complete listing of examples of physician duties under a CMA is provided as Figure 4.

Historically, co-management has been associated with the more “hospital proceduralist” specialties such as cardiology or orthopedics, but more recently has found application between oncologists and hospital oncology service lines.

In CMA alignments, there are typically two levels of compensation earned by the participating physicians. First 16

FIGURE 3. EXAMPLE OF A BLOCK LEASE ARRANGEMENT.

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a fixed base fee consistent with the fair market value of the time and effort and professional expertise contributed by participating physicians to hospital service-line development, clinical management and professional oversight.

The second element of compensation in a CMA arrangement is a bonus fee, which is predetermined and contingent upon achieving specified, mutually agreed upon and objectively measurable program development, quality improvement, and efficiency goals. In a CMA arrangement, participating physician compensation can range from four to seven percent of service line net revenues under co-management.

A variant on the direct contractual CMA, described a bove, is a Co-Management Joint Venture Company.

The Co-Management Joint Venture Company has the same purpose as the direct contractual variety, that is, to engage and to appropriately reward participating physicians for their contribution as clinical leaders in developing, implementing, co-managing, and improving quality and efficiency of a hospital’s service line. However, forming a Co-Management Joint Venture Company adds a layer of organizational formality and sustainability (and cost) to the co-management relationship.

Schematic diagrams of the direct contract co-management alignment model and of the Co-Management Joint Venture Company are provided in Figures 5 and 6, respectively.

However, since community oncology, unlike hospital proceduralist specialties, is predominantly provided in the physician office setting, a stand-alone CMA arrangement can be compromised as long as the oncologist “co-managers” are competing with the hospital for ancillary services, chemotherapy, radiation therapy, and imaging in particular.

Thus in CMA deliberations with oncologists, the dialog typically shifts to consideration of the consolidation of such ancillary services as hospital provider-based services which are then “turnkey” managed by the oncologists.

This is the model contemplated below in the professional services arrangement (PSA) and management services arrangement (MSA).

FIGURE 4. EXAMPLES OF ONCOLOGIST DUTIES UNDER A CMA.

Professional Services Agreement In a PSA, a physician or physician group provides professional medical services to patients of another organization, a hospital for example. Physician(s) who provide professional medical services under a PSA are compensated for their services, typically on the basis of a work productivity formula, such as resource-based relative value units (RVUs), although there is a trend in substituting a pure RVU productivity compensation with a quality/ value component. PSAs have been around for a long time as a mechanism for “hiring” a physician as independent contractor, particularly in jurisdictions which preclude direct employment of physicians by a nonphysician, the so-called “corporate practice of medicine doctrine,” which is particularly restrictive in California and Texas.

A more current application of PSAs in the oncology alignment setting is one in which a hospital, as contractor, contracts with an oncology medical group practice, rather than a single physician, to provide the professional medical services on an exclusive basis. This application serves to preserve the practice entity and gives flexibility to the practice in assigning physicians to perform the work and in dealing with physician compensation issues associated with revenues generated under the PSA. In some instances, PSAs are drafted to include physician responsibilities and compensation in addition to patient care services, such as medical directorship and clinical program development.

In addition, PSAs are frequently found in situations where the alignment contemplated is one of converting the HTTP://OPPP.US

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physician office-based ancillary services (chemotherapy, radiation and/or imaging) to a hospital provider-based service. In fact, a stand-alone PSA in oncology is not too compelling if the practice is to retain its ancillary service business independent of the hospital. The PSA model is depicted in Figure 7.

Management Services Agreement The essence of the MSA is that one individual or organization contracts with another individual or organization to provide management services for all or a portion of the business of the contracting entity. In the case of oncologist–hospital alignment, this typically translates to hospital contracting with oncology medical group to provide routine day-to-day operational and managerial services to the hospital’s oncology service line/cancer program. The MSA relationship is usually limited to outpatient services, but in some instances includes inpatient oncology services management as well.

Fundamental to a MSA arrangement, the hospital recognizes that the practice brings operational infrastructure and managerial value to the combined service which the hospital may not currently have in place. The theory is that since the oncology practice has been managing an outpatient business (their practice) successfully for the past 20 some odd years and has the preponderance of market share in outpatient oncology (probably 60%–80% in many markets), why not task them to provide day-to-day operational expertise to the expanded oncology enterprise?

In instances of a comprehensive alignment relationship between oncologists and hospital, where the oncology group is providing both professional and management services to the hospital service line, the applicable PSA and the MSA provisions are merged into a single document, a Professional Services and Management Agreement (PSMA). But whether two documents or one merged document, the context is the same; oncology medical group provides “turnkey” professional and managerial services to patients of the hospital for a fee (there are some regulatory limitations on the truly “turnkey” nature of the services to be provided under a MSA or PSMA by the physician group. For example, under Medicare regulations, in order to qualify for status as a hospital provider-based entity, for any service site “off campus” of the main hospital facility, the hospital would need to directly employ the clinical personnel providing services (nurses, pharmacist, etc.)).

So, what is the difference between a MSA and a CMA. The distinction between the two is subtle and the terminology is frequently used interchangeably. The distinction is that in a CMA relationship, physicians are typically less involved in routine service line operations. In the CMA, the role is more associated with providing clinical leadership and program development expansion than actually implementing and managing services.

However, in an MSA relationship, the physicians/physician practice assumes a much more active responsibility for routine day-to-day service-line operations. If a MSA relationship provides for a significant division of responsibilities between the physician practice and hospital personnel, such that the two parties are really co-managing the hospital service line, the subtleties between MSA and CMA get blurred. So just pick your label and move on. It is the substance of the agreement (MSA or CMA) that matters, not the label. See Figure 8 for diagram of the MSA model.

FIGURE 5. CO-MANAGEMENT AGREEMENT.

FIGURE 6. CO-MANAGEMENT JOINT VENTURE.

Comprehensive PSA + MSA + CMA A recent trend in oncologist–hospital alignments has been to combine the features of all three advanced alignment models (PSA + MSA + CMA) into a single relationship. That is, an oncology medical group contracts with hospital/health 18

FIGURE 7. PROFESSIONAL SERVICE AGREEMENT.

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system to provide a comprehensive package of professional medical services, day-to-day management services plus service line clinical program development leadership. Again, putting labels aside (PSA, MSA, CMA), it is the substance of the agreement that matters, not what you call it.

A schematic of the comprehensive PSA + MSA + CMA is provided in Figure 9.

Furthermore, see Figure 10 for a table of costing guidelines associated with each of the elements of the advanced alignment models.

The Oncology ACO Is there a place for payers in the alignment dialogue? Often the primary objectives of an oncologist–hospital alignment are to incorporate consistency and evidence-based practice, workflow redesign and reduction of redundancies and costs across the full-continuum enterprise. And in achieving this goal, it has been demonstrated that the cancer spend can be reduced by 12–15%.1,2 However, if the providers of care – the oncologists and hospital in this case – work hard to bring about a reduction in cancer care costs (“spend”), without commensurate economic recognition from the payers for that care, it is the providers who lose (reduced revenue) and the payers (Medicare, Medicaid, commercial health plans) who win by virtue of markedly reduced medical cost for cancer services.

A balance in the form of alternate payment methodologies to reward provider success is required. Otherwise why should providers – oncologists and hospitals – assume all this hard work and disruption? Solely for the benefit of payers who reap the windfall?

Enter a new model of oncologist–hospital alignment, the Oncology ACO, designed to address concept of accountability for reining in cancer costs without being compromised financially for doing so.

The Oncology ACO, pioneered through a collaboration among health system, oncology practice and payer in South Florida,3 is a forum for cancer care process redesign and care coordination across the full continuum and for the implementation of alternate payment methodologies in oncology, bundled/episode-based pricing for example.

The model assumes participation from one or more health plan and most commonly is launched with a shared savings methodology with the participating health plan(s) transitioning to tumor-site-specific bundled prices within specified timeframe (two years). The features of the oncology medical home serve as the definitive care process construct, those core processes being pathways adherence, care coordination to minimize hospital emergency room, and inpatient activity and disciplined end-of-life counseling.

And finally, the Oncology ACO model assumes that the organization will be supported via a robust data aggregation and analytics platform that is capable of producing meaningful clinical and cost outcomes data that documents a value proposition. See Figure 11 for diagram of the features of the Oncology ACO model.

FIGURE 8. MANAGEMENT SERVICE AGREEMENT.

FIGURE 9. COMPREHENSIVE PSA + MSA + CMA.

Alignment Model Success Factors Regardless of the form of oncologist–hospital alignment, the success factors listed below are common to all models.

Without these features, the likelihood of forging a successful oncologist–hospital alignment is diminished.

• Both oncologist leadership and hospital C-level leadership committed to openly exploring the possibilities of meaningful business collaboration; • Shared vision of the future state and a belief that things will be more sustainable working collaboratively; • Trust level and mutual respect among the key stakeholders; and HTTP://OPPP.US

FIGURE 10. PSA + MSA + CMA COSTING GUIDELINES.

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• Economic and transaction terms that make sense to both the physicians and the hospital.

CURRENT ISSUES IN ONCOLOGIST– HOSPITAL ALIGNMENT Two major policy issues have surfaced, the resolution of which will likely have an impact on the current economics of oncologist–hospital alignment. One issue is the policy debate with regard to the cost differential between physician office-based services and its counterpart hospital providerbased (outpatient) services. The other major policy issue is the expansion of the 340B drug pricing program available to not-for-profit hospitals (and other qualified entities) servicing a disproportionate share of indigent/ uninsured patients.

Site-of-Service Cost Differential Debate First, a clarification: in this context, when we speak of “cost,” we are actually referring to reimbursed medical costs from the payers perspective – the amount reimbursed – not actual operating costs. Probably no one really knows the situationby-situation true cost differential between services provided in an oncologist office versus a hospital outpatient setting.

The consensus wisdom is that physician offices are less expensive settings than hospitals for like care. And this may well be true – but where is the empirical evidence to prove it? There have been several recent credible studies of the reimbursement cost differential between physician office and hospital outpatient settings which found a 25%–53% of disparity.4–6 The site-of-care cost differential issue becomes visible in circumstances where oncologists and hospital are, in fact, pursuing an economically integrated business alignment, such as PSA/MSA combinations resulting from consolidating services to a hospital provider-based setting.

While good for advancing care coordination and value-based ideals, the PSA/MSA may be not so good from a payer and patient co-pay perspective. Post-consolidation, payers can expect to see their medical costs increase 25–53% (or more depending on how you choose to slice the data).

The site-of-care differential issue becomes so visible, in fact, that legislation has been introduced in congress that would instruct the Center for Medicare and Medicaid Services to bridge the gap in Medicare reimbursement for oncologic services, that is to reimburse for services in hospital outpatient settings no more than that which is paid to physicians in the office setting. The proposed legislation is H.R. 2869, the Medicare Patient Access to Cancer Act of 2013. The American Hospital Association has responded to H.R. 2869 citing it as unfair to hospitals who invariably have a higher cost structure than physician offices due to the additional services required of a hospital.

In addition, a number of commercial health plans have simply taken the position that they will not reimburse hospitals more for like oncologic services when they are converted from physician office-based to hospital outpatient services. This then becomes a situation-by-situation negotiation between the hospital and the health plan.

One solution to the cost differential was the approach taken in one recent high-profile oncology practice-hospital alignment in the nature of a comprehensive PSA + MSA + CMA. That is, as part of the design of the consolidation, the hospital agreed to accept as reimbursement from the primary health plans affected by the consolidation, the rates that were being paid to the practice pre-consolidation. The alignment economics still worked despite the “haircut” in reimbursement rates. Problem solved (West Clinic and Methodist Le Bonheur Health System, Memphis form Partnership. January 2012).

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FIGURE 11. THE ONCOLOGY ACO.

340B Drug Pricing Program Initiated in 1992 under the Veterans Health Care Act Section 340B, this program discounts outpatient drug prices for nonprofit hospitals (and other qualified healthcare entities) that treat a disproportionate share (DSH; see generally Health Resources and Services Administration at www.hrsa.gov) of low-income Medicare, Medicaid, and uninsured patients.

A hospital becomes qualified for the 340B drug pricing program if it meets a threshold adjusted disproportionate share index of at least 11.75%. There are approximately 1,200 340B qualified hospitals in the USA, about 30% of all U.S. hospitals.

340B program discounts can range from 25% to upward of 40% below market basket rates. Applying these rates to an oncologist-hospital alignment involving, say 10 medical oncologists, that converts physician office-based chemotherapy to a hospital office-based setting that can result in an immediate reduction in operating costs for the consolidated program of perhaps $7.5M annual (calculation of 340B savings: assumes 10 medical oncologists at average annual per oncologist drug buy at $2.5M each = $25M × estimated 340B drug price discount at 30% = $7.5M).

And isn’t that one objective under health reform – to reduce costs of care? Yes, but as with the site-of-service cost differential issue, there are winners and losers in the 340 drug pricing program. Hospital wins an improved operating margin of $7.5M. And pharmaceutical manufacturers lose $7.5M in sales.

In addition, pharma does not think that this is fair.

The argument is that the original intent of the 340 drug pricing program was to give a price concession to qualified entities for providing outpatient drug to indigent patients.

In the example above, the $7.5M drug cost savings is arrived at by applying the 340B drug discount to all outpatients of the qualified hospital, not just to the low income-uninsured portion of outpatients.

The 340B drug pricing program is administered by the Health Resources and Services administration (HSRA) of the U.S. Department of Health and Human Services.

Regulations promulgated by HSRA do not make clear that 340B drug can only be used to treat the low-income/

"A block lease arrangement is one in which a health-care provider leases a set block of time of healthcare facilities and/or medical equipment during which such provider has exclusive use of such facilities and/or equipment to deliver services to its patients."

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indigent class of outpatients, thus the interpretation by 340B qualified organizations has been that their 340B priced drugs can be administered and dispensed to all patients of the 340B qualified entity (insured patients or otherwise).

Under pressure from the pharmaceutical and drug supply distribution sector, this issue is undergoing scrutiny with the expectation that HSRA will issue by QTR 3 2014 regulations that clarify this matter and will put new limitations on the application of 340B priced drug to any but the originally intended low income/indigent/uninsured population served by 340B qualified entities.

Both of these controversial issues, site-of-care cost differential and 340B drug pricing, are anticipated to be clarified by the end of 2014 and with those clarifications may come economic impact to the efforts of providers to consolidate and rationalize oncology/cancer care services. In the meantime, those in the forefront of advancing oncologist–hospital alignment are building these variables into their planning budgets – one with a sensitivity to reduced reimbursement (site-of-service

differential) and the other a compromise to cost reduction (340B pricing restrictions).

CONCLUSION Innovative and enlightened oncology providers remain keenly interested in undertaking to consolidate cancer care services for the purposes of care consistency, cost containment and value generation across the full continuum of cancer care.

The transactional, financial, and operational planning for such oncologist–hospital alignment undertakings has always required a disciplined attention to detail and no more so than now with such undertakings receiving a higher level of scrutiny.

But despite the regulatory and reimbursement unknowns, the basic proposition of system de-fragmentation as exemplified in the predominant oncologist–hospital alignment models remains valid – that through open and earnest collaboration among the providers of care – oncologists and hospitals – a superior and sustainable cancer care delivery system will emerge.

AUTHORS’ DISCLOSURES OF POTENTIAL CONFLICTS OF INTEREST The authors indicated no potential conflicts of interest.

REFERENCES 1. Sprandio JD. Consultants in Medical Oncology & Hematology. Oncology Patient Centered Medical Home® Analysis of OPCMH. Drexel Hill, PA: McKinsey & Company; 2010.

2. Butcher, L. How oncologists are bending the cost curve. Oncology Times. January 10, 2013.

3. The Miami Herald. May 3, 2012. Florida Blue, Baptist Health of South Florida and Advanced Medical Specialties set up innovative organization to improve care for cancer patients. First Oncology-specific ACO. 4. Fitch K, Pyenson B. Comparing Episodes of Cancer Care Costs in Different Settings: An Actuarial Analysis of Patients Receiving Chemotherapy. New York, NY: Milliman, Inc. 5. The Moran Company. Cost Differences in Cancer Care across Settings. Arlington, VA: The Moran Company.

6. Avalere Healthcare, LLC. Total Costs of Cancer Care by Site of Service: Physician Office vs. Outpatient Hospital. Washington, DC: Avalere Healthcare, LLC.

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DEFINING THE VALUE OF PROTON THERAPY Using Time-Driven Activity-Based Costing

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ABSTRACT

Nikhil G. Thaker, M.D., Alexis

Introduction Technological innovations in radiation therapy (RT) have rapidly improved the quality of care for patients with head and neck cancer. Intensitymodulated proton therapy (IMPT) holds promise of further improving outcomes compared with the current photon-based technique (intensitymodulated radiation therapy [IMRT]). However, there are no data comparing the outcomes and costs of these competing technologies. In this study, we applied time-driven activity-based costing (TDABC) to define the value of these advanced RT technologies.

Feeley, M.D., Tiffany M. Jones,

Materials and Methods We selected the first two cases of IMPT and IMRT from our institutional prospective, randomized controlled trial. Process maps were created for RT treatments and for all clinical services rendered during the course of RT. Cumulative TDABC costs were generated based upon the time required at each step of the activity and the personnel resource cost at that step. Costs were plotted on a sequential daily basis from the time of new patient registration to the end of RT treatment.

Radiation Oncology, The

Results RT doses to the oral cavity, larynx, and brainstem were lower with IMPT than with IMRT. TDABC cost for each daily IMPT treatment was 2.8 times higher than for IMRT. The IMRT patient had a longer delay to beginning therapy and higher costs associated with re-consultation and re-imaging. IMRT resulted in 20% higher TDABC costs from time of initial consultation to the end of RT as compared with IMPT.

Care, The University of Texas

Conclusions TDABC is an innovative costing tool that can be used to define the value of competing health-care technologies and treatments. The episodic cost of care using an IMPT-based treatment strategy in advanced stage head and neck cancer was less costly and of higher value than IMRT. These data can be used to evaluate the true cost of care delivery at the provider level and may be utilized in discussions with patients, payers, and policy makers to communicate the value of high-quality, innovative cancer care services.

Anderson Cancer Center,

B. Guzman, M.B.A., Thomas W. DrPH, James R. Incalcaterra, Ph.D., Christian Kolom, M.B.A., LaToi S. Tatum, MHA, Ronald S. Walters, M.D., M.B.A., MHA, Scott B. Cantor, Ph.D., David I. Rosenthal, M.D., Adam S. Garden , M.D., Gary B. Gunn, M.D., Clifton D. Fuller, M.D., Ph.D., Matthew B. Palmer, M.B.A., Steven J. Frank, M.D. From the Department of University of Texas MD Anderson Cancer Center, Houston, Texas (N.G.T., D.I.R., A.S.G., G.B.G., C.D.F., M.B.P., S.J.F.); Institute for Cancer Care Innovation, The University of Texas MD Anderson Cancer Center, Houston, Texas (N.G.T., A.B.G., T.W.F., T.M.J., L.S.T., R.S.W.); Division of Anesthesiology and Critical MD Anderson Cancer Center, Houston, Texas (T.W.F.); Financial Planning and Analysis, The University of Texas MD Anderson Cancer Center, Houston, Texas (J.R.I., C.K.); and Department of Health Services Research, The University of Texas MD Houston, Texas (S.B.C.).

Submitted May 30, 2014; revised June 11, 2014

Technological innovations in radiation therapy (RT) have rapidly improved the quality of care for head and neck cancer patients1. Photon-based RT techniques for head and neck cancers have evolved from twodimensional to three-dimensional conformal RT to intensity-modulated radiation therapy (IMRT).

Advancements in RT planning and treatment delivery have been directly correlated with significant reductions in toxicity, improvements in quality of life (QOL), better tumor control, and even a trend towards improved survival2, 3. However, achieving optimal tumor coverage with IMRT can still lead to substantial irradiation of normal tissues and morbidity for patients4, 5.

Proton RT techniques have evolved as well, and intensitymodulated proton therapy (IMPT) holds promise of further diminishing toxicity and improving QOL profiles for patients6, 7. Proton therapy is a natural evolution of more advanced RT delivery techniques and has unique physical properties that are capable of delivering high doses of radiation while reducing and eliminating unnecessary dose to surrounding normal tissues8. In head and neck cancer treatment with IMPT, reduced dose to normal tissues can result in less weight loss, less requirement for intravenous fluids, and fewer emergency room visits, hospitalizations, and feeding tubes9.

Advances in technologies, such as IMRT or IMPT, can add significant costs to providing cancer care, and defining the value of technological innovation has become more critical in the current health-care environment. Cost measurement of personnel resources, time, equipment, and clinical outcome is complex, making it difficult to assign a cost to individual treatments, let alone costs of competing technologies. An incomplete understanding of the value of novel, yet costly, technologies could impede medical innovation at the expense of evidence development and could decrease the quality of cancer care in the long term. Development of a robust and reproducible methodology for measuring the value of innovative technology would provide directly relevant information to patients, payers, policy makers, and healthcare providers.

Several industries have successfully applied the concepts of time-driven activity-based costing (TDABC)10, 11 and value-based competition, which is defined as outcomes divided by costs12–15. TDABC is a variation of activity-based costing where process costs are analyzed based on time consumption of constituent activities that then determine how costs are allocated throughout the system16–18. TDABC can integrate a spectrum of complex processes, and perhaps most importantly, can provide insight into unused capacity HTTP://OPPP.US

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within the health-care system. While most applications of TDABC have pertained to industry personnel and process improvements, this concept can be readily applied to measure and communicate the value of technologically oriented healthcare delivery systems.

In this study, we applied TDABC and the concepts of value-based competition to communicate the value of chemoradiation strategies with IMPT or IMRT within the context of a prospective, randomized controlled trial (RCT). We calculated cumulative TDABC costs for patients undergoing RT treatment to assess their relative costs. In the RCT, we have hypothesized that reductions in treatmentrelated toxicities, improvements in patient-reported outcomes, and lower episodic costs of care will translate into highervalue care for IMPT than IMRT. In this proof-of-principle study using TDABC methodologies, we present a model for defining and communicating the value of RT technological innovation for patients with head and neck cancer

MATERIALS AND METHODS Patient and study selection criteria We analyzed data from the Head and Neck Center at The University of Texas MD Anderson Cancer Center (MDACC). We selected the first two patients enrolled on an ongoing prospective RCT for patients with advanced stage oropharyngeal tumors19. The primary objective of this phase II/III RCT trial is to identify a less toxic approach of delivering conformal RT for patients with oropharyngeal tumors. More specifically, the trial aims to show that IMPT will substantially reduce the burden of acute and late toxicity, resulting in faster recovery and return to function, with similar rates of long-term survivorship, compared with IMRT. The first patient undergoing IMRT and the first patient undergoing IMPT on this trial were included in this costing analysis.

Tumor volumes, normal tissues, and treatment planning simulation An initial CT scan was obtained for treatment planning (ie, simulation scan). This scan was used to define the tumor volumes (ie, those volumes that were at high, intermediate, and low-risk depending upon the tumor location and known patterns of spread) and the normal tissues. These volumes were delineated by a single radiation oncologist and were reviewed for quality assurance by five other radiation oncologists who specialize in head and neck radiation oncology. Target delineation was performed prior to randomization in order to avoid biasing target volumes with a priori knowledge of the mode of treatment planning HTTP://OPPP.US

"Advances in technologies, such as IMRT or IMPT, can add significant costs to providing cancer care, and defining the value of technological innovation has become more critical in the current health-care environment."

and delivery. These tumor volumes were each expanded further to account for microscopic disease and the uncertainty in daily set-up of the patient. The normal tissues included the brain, brainstem, spinal cord, pharyngeal constrictors, salivary glands, oral cavity, esophagus, and larynx.

The primary objective for the RT treatment plan was to achieve maximal tumor coverage, while minimizing dose to the normal tissues, as described previously8. IMRT plans were generated with photon beams and a 9-beam arrangement using inverse planning for optimization. Due to the unique physical profile of protons, IMPT plans were generated with a 3-beam arrangement using inverse planning for optimization.

Initial proton beam arrangements were chosen for maximum target coverage and then individually optimized to minimize the dose to critical structures and normal tissues using the multi-field optimization option7. A distal beam range was used to estimate the depth of the highest dose of the proton beam along its axis. A range shifter was used to bring the dose close to the shallowest part of the tumor.

Each patient was treated over 33 treatment days (ie, fractions) from Monday through Friday of each week. The tumor and high-risk microscopic disease received 70 Gy (ie, the energy absorbed per unit of weight of the patient), intermediate-risk microscopic disease received 63 Gy, and lowrisk microscopic disease received 57 Gy. The dose unit for the IMPT plans was Gy (relative biological effectiveness [RBE]) rather than Gy.

Clinical outcome measurement Objective clinical outcome domains were evaluated at baseline, at weekly appointments during the course of RT, and at scheduled follow-ups, as specified by protocol. Toxicity was graded based on the NIH-Common Toxicity Criteria for Adverse Events version 4.0. Patient-reported outcomes were assessed using: FACT-HNSI-10, MD Anderson Dysphagia Inventory (MDASI) – Head and Neck, Xerostomia questionnaire, and Work status questionnaire. These data were prospectively collected by the clinical and research staff.

TDABC Measurement Methodology Process maps were created for IMPT (Fig. 1), for IMRT, and for ancillary clinical services rendered during the course of RT. Each step in the process map was associated with a specific personnel resource and the time necessary to complete each activity20. Activity times for each process step were documented by the self-report of each resource, by direct observation of each participant by their supervisor, and from the institutional scheduling system. Decision and chance nodes were embedded throughout the process maps, and 23

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the probability that each patient would pass through that specific clinical pathway was indicated by a percentage value at each node.

Cost Calculation For each activity, there was an associated personnel resource and an adjusted average hourly rate (AHR). Compensation data based on job codes were obtained from the institutional PeopleSoft (Oracle Inc., Redwood Shores, CA, USA) payroll application. Costs included employment costs, such as salary and benefits, direct costs associated with treatment, and allocated indirect costs. The total salary and benefit expense for a particular resource or job group was divided by the annual number of work hours in a year, and adjusted for nonproductive work time (ie, vacation and sick time), which was approximately 8%, and for indirect work time (ie, orientation, training, breaks, etc.), which was approximately 8%. When multiple resources were potentially involved in an activity, the AHR was weighted for the number and type of resources. The AHR was divided by 60 to calculate a cost per minute (CPM) rate. The activity cost was the time elapsed during the transaction in minutes multiplied by the CPM. The per-patient process cost for care delivered was estimated for each step in the process maps based on time estimates and CPMs for personnel. For a patient moving through the process, the total cost was calculated as the sum of all activities a patient encounters in a given pathway.

Similarly, TDABC calculation was conducted in other clinical departments that the patient visited during the course of RT, including medical oncology, surgical oncology, dental oncology, gastroenterology, laboratory, and diagnostic imaging. TDABC modeling is not yet available for the interventional radiology suite and supportive care due to personnel resource limitations. To model the costs for feeding tube placement, gastroenterology procedure and consultation cost estimates were used as a proxy for interventional radiology costs. Costs associated with depreciation of RT and diagnostic imaging equipment were also embedded into the cost analysis using a simple depreciation model. Depreciable life for a linear accelerator (which generates IMRT treatment), synchrotron (which generates IMPT treatment), and diagnostic imaging equipment were estimated based on institutional and manufacturer’s recommendations.

TDABC costs were calculated cumulatively on a daily basis from the patient’s initial consultation at MDACC to the end of RT or from the time of simulation to the end of RT. All costs are reported as normalized ratios to the lowest absolute daily TDABC cost to allow for relative cost comparisons. For the comparison of the TDABC cost of IMPT versus IMRT, the cost of daily IMPT treatment was divided by the cost of daily IMRT treatment.

"A hospital becomes qualified for the 340B drug pricing program if it meets a threshold adjusted disproportionate share index of at least 11.75%.

There are approximately 1,200 340B qualified hospitals in the USA, about 30% of all U.S. Hospitals."

RESULTS RT Treatment Plans Demographic and tumor characteristics for the representative IMPT and IMRT patients are presented in Table 1. Both patients were treated with RT to 70 Gy in 33 fractions and with concurrent weekly cisplatin chemotherapy at 40 mg/m2.

RT dose distribution from IMPT was compared with the dose distribution from IMRT. The oral cavity, larynx, and brainstem received lower doses with IMPT than with IMRT (Fig. 2).

TDABC Analysis Cumulative TDABC costs were plotted on a sequential daily basis from (1) the time of initial consultation at MDACC to the end of RT treatment (Fig. 3A) and (2) time of simulation to the end of RT treatment, including all direct costs 24

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Characteristic

IMPT IMRT

Age 52 56 Sex Male Male Histology Squamous Squamous

cell cancer cell cancer Tumor location Right base Left

of tongue glossopharyngeal sulcus 2010 American T3 N2b T2 N2b Joint Committee on Cancer stage TABLE 1. PATIENT CHARACTERISTICS.

IMPT, INTENSITY MODULATED PROTON THERAPY; IMRT, INTENSITY MODULATED RADIATION THERAPY.

associated with RT (Fig. 3B). All costing data are plotted in real-time as patients underwent RT and other clinical services in the context of the RCT. The patient undergoing IMRT first registered as a new patient at MDACC 56 days prior to the start of RT. This patient was initially undecided if he would pursue RT at this institution on protocol. He ultimately decided to undergo therapy approximately one month after initial evaluation, and required re-evaluation in head and neck surgery, radiation oncology, and dental oncology approximately. He underwent simulation for RT treatment planning 12 days prior to the start of RT (Fig. 3A). The patient undergoing IMPT had a shorter interval from time of first registration to start of RT

START

1 Radiation Therapist

2 Radiation Therapist

Retrieve Pt, place pt on board, insert dental stint and place face mask

Is beam available for gantry?

Scan and compare scans

3

(34 days), and an 18-day interval from simulation to the beginning of RT. The TDABC costs of IMRT were 56% higher than IMPT at the start of RT (Fig. 3A) due to the higher cost of re-consultations and re-imaging studies from the delay in beginning RT. However, the TDABC cost of each daily IMPT treatment is 2.8 times higher than that for IMRT (due to the higher embedded equipment cost), and the modeled costing analysis would have predicted that the cost of IMPT would have eventually outpaced the cost of IMRT. However, during the course of RT, the IMRT patient lost 13% of his weight in the first 28 days of treatment. The MDASI showed severe levels of nausea, vomiting, dry mouth, difficulty tasting food, and thick mucus in the mouth.

Physical examination at this time revealed inflammation throughout the left side of the mouth and throat. Initial supportive care measures, including nutrition and pain management consultations, oral and intravenous medications and fluid support, were ineffective. The patient eventually required placement of a gastric feeding tube on day 28 of treatment due to the weight loss. On day 34 of treatment, the IMRT patient required replanning of the RT, because weight loss altered the dose distribution to tumor and normal tissues.

Cumulative TDABC costs from time of initial consultation to the end of RT were ultimately 20% higher for IMRT than IMPT. The TDABC cost analysis was then narrowed to incorporate costs incurred during the course of RT alone, to account for the variable length of time and costs incurred during the pre-RT time period (Fig. 3B). The costs for IMRT and IMPT were therefore identical at the beginning

4 Radiation Therapist

Is beam available for gantry?

Treatment field #1

4

6 Radiation Therapist

Is beam available for gantry?

Reposition and admimister treatment field #2

5

N 25%

3 Radiation Therapist

5 Radiation Therapist

7 Radiation Therapist

3-20

END

Remove Pt from board and prepare for next Pt

3 Y 10%

Is beam available for gantry?

Wait for beam & fix images

3-20

11 Radiation Therapist N 90%

5

N 25%

Wait for beam & fix images

Does Pt require a 4th treatment field?

Reposition and admimister treatment field #3

5

N 25%

Wait for beam & fix images

8 Radiation Therapist

10 Radiation Therapist Y 75%

3-20

Reposition and admimister treatment field #3

5 N 25%

9 Radiation Therapist Wait for beam & fix images

3-20

FIGURE 1. PROCESS MAP FOR IMPT TREATMENT. EACH BOX = STEP/ACTIVITY THROUGH WHICH A PATIENT PASSES IN PROCESS. NUMBER AT TOP OF EACH BOX = THE NUMBER IN SEQUENCE OF STEP/ACTIVITY. LETTERS AT TOP OF BOX = RESOURCE THAT COMPLETES DESCRIBED STEP/ACTIVITY IN THE PROCESS (DESCRIPTIONS OF EACH RESOURCE ARE LISTED AT THE BOTTOM OF EACH FIGURE). NUMBERS CIRCLED AT BOTTOM RIGHT CORNER OF STEP/ACTIVITY BOX = NUMBER OF MINUTES NEED TO COMPLETE ACTIVITY DESCRIBED IN THE BOX. PERCENTAGES = PERCENTAGE OF PATIENTS WHO PASS THROUGH EACH POINT IN PROCESS, Y = YES, N = NO. IMPT, INTENSITY MODULATED PROTON THERAPY.

FIGURE 2. DOSIMETRIC COMPARISON OF IMPT VERSUS IMRT FOR A REPRESENTATIVE PATIENT. REPRESENTATIVE AXIAL AND CORONAL IMAGES OF (A) IMPT AND (B) IMRT PLANS DEMONSTRATE SIMILAR CONFORMALITY OF THE PRIMARY TUMOR. HOWEVER, THE IMPT PLAN RESULTS IN LESS INTEGRAL DOSE. (C) THE IMRT PLAN HAS MORE DOSE TO THE ORAL CAVITY, SPINAL CORD, AND LARYNX, AS COMPARED WITH THE IMPT PLAN. RED IS HIGH DOSE; GREEN IS INTERMEDIATE DOSE; AND BLUE IS LOW DOSE. IMPT, INTENSITY MODULATED PROTON THERAPY; IMRT, INTENSITY MODULATED RADIATION THERAPY.

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AUTHORS’ DISCLOSURES OF POTENTIAL CONFLICTS OF INTEREST

SJF is the principal investigator of the Phase II/III randomized clinical trial of IMPT versus IMRT for advanced stage oropharyngeal tumors at the University of Texas MD Anderson Cancer Center. SJF received an honorarium from Varian Medical Systems to speak at the Varian & Siemens Users Meeting during the 55th Annual Meeting of the American Society of Radiation Oncology in September 2013.

NGT was funded in part by the 2014 RSNA/AUR/APDR/SCARD Radiology Education Research Development Grant and is the E. Stephen Amis Fellow in Quality and Safety of the American College of Radiology.

CDF receives grant support from the National Institutes of Health/National Cancer Institute’s Paul Calabresi Clinical Oncology Award Program (K12 CA088084-06) and Clinician Scientist Loan Repayment Program (L30 CA136381-02).

FIGURE 3. CUMULATIVE COSTS OF PROTONS VERSUS IMRT. (A) TOTAL COSTS OF PATIENT CARE FROM INITIAL CONSULTATION TO THE END RT WERE PLOTTED ON A SEQUENTIAL DAILY BASIS. DAY 0 REPRESENTS THE INITIAL CONSULTATION. THE CUMULATIVE COST FOR THE IMRT PATIENT AT THE START OF RT WAS 56% HIGHER THAN THAT FOR THE IMPT PATIENT DUE TO THE NEED FOR RE-CONSULTATIONS AND RE-STAGING STUDIES AFTER A 30 DAY DELAY. DURING THE COURSE OF RT, THE IMRT PATIENT LOST 13% OF HIS WEIGHT IN THE FIRST 28 DAYS OF TREATMENT. HE REQUIRED PLACEMENT OF A FEEDING TUBE ON DAY 28 OF TREATMENT AND RE-PLANNING OF THE RT ON DAY 34 DUE TO WEIGHT LOSS. CUMULATIVE TDABC COSTS BY THE END OF RT WERE 20% HIGHER FOR IMRT THAN IMPT. (B) CUMULATIVE COSTS OF CARE DURING THE COURSE OF RT WERE PLOTTED ON A SEQUENTIAL DAILY BASIS TO INCORPORATE COSTS INCURRED ONLY DURING THE COURSE OF RT. THE COSTS FOR IMRT AND IMPT WERE IDENTICAL AT THE BEGINNING OF RT (DAY 0) AND CONSISTED OF THE COSTS ASSOCIATED WITH RT EVALUATION, SIMULATION, AND TREATMENT PLANNING. TDABC COSTS FOR IMPT ROSE MORE RAPIDLY THAN THOSE OF IMRT DUE TO THE 2.8 TIMES HIGHER PER FRACTION COST. HOWEVER, UPON REQUIRING A FEEDING TUBE AND RE-PLANNING OF RT DUE TO WEIGHT LOSS, THE COST OF IMRT AND IMPT BECAME EQUIVALENT BY DAY 31 OF TREATMENT. BY THE END OF RT TREATMENT, THE COST OF IMPT WAS ONLY 6% HIGHER THAN THE COST OF IMRT. THE PATIENT TREATED WITH IMRT LOST 18% OF HIS BODY WEIGHT DURING THE COURSE OF RT, WHEREAS THE PATIENT TREATED WITH IMPT LOST 6% OF HIS BODY WEIGHT.

26

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of RT (Day 0) and consisted of the costs associated with RT evaluation, simulation, and treatment planning. The TDABC costs for IMPT rose more rapidly due to the higher per fraction cost compared with IMRT. By Days 10 and 25 from the start of RT, IMPT was 22% and 26% more costly than IMRT, respectively. However, as acute toxicities caused by IMRT increased during the course of RT and the patient required a feeding tube and re-simulation for weight loss, the cost of IMRT surpassed the cost of IMPT by Day 31 of concurrent chemoradiation treatment. The IMRT patient had more TDABC data points (36 for IMRT vs. 32 for IMPT, Fig. 3B) due to the requirement for clinical services, such as supportive care and intravenous fluids, on several of the weekend days during treatment. By the end of RT treatment, the cost of using IMPT was only 6% higher than IMRT.

DISCUSSION In this study, we demonstrate how TDABC can be used to measure and communicate the value of competing technologies through a powerful integration of time and cost factors into the value framework analysis. Although IMPT has higher upfront equipment and delivery costs than IMRT, our case analysis suggests that IMPT may be more costeffective than IMRT if the acute toxicities of RT are avoided.

Value measurement is an integral part of delivering highquality cancer care, with endpoints that include patient outcomes and costs. However, in the current health-care system, reimbursement codes inappropriately and arbitrarily value clinical services, simultaneously causing over-use and under-use of certain services and cost shifting to subsidize the expense of under-valued, yet important, services. Health-care systems are therefore unaware of the true costs of delivering a specific process of care and instead measure costs based on reimbursements rather than the consumption of health-care resources. An improved system for measuring actual costs would track resource consumption over the entire care cycle based on the patient’s specific condition.

TDABC and value-based competition can more accurately measure true cost by capturing the actual time spent by health-care providers to provide a treatment12–15. Since time is a non-renewable and increasingly scarce resource in the current health-care system21, its measurement may better reflect the consumption of health-care resources. TDABC can integrate a spectrum of complex processes, align the incentives of patients, providers, policy makers, and insurers, and help decrease the cost of clinical care at the patient level. Perhaps most importantly, TDABC can provide insight into unused capacity within the health-care system. Once the healthcare organization can measure the outcomes and cost of the current state, performance improvement can be pursued to increase the accessibility and affordability of high-quality cancer care.

While most applications of TDABC have pertained to personnel and process improvements16–18, our study suggests that this concept can be applied to measuring and communicating the value of technologically oriented delivery systems. Various technologies are available for delivering RT, and these technological advances have been directly correlated with significant improvements in outcomes2,8. IMPT holds promise for further improvements in clinical outcome, although at higher infrastructure costs. Unfortunately, there are no available estimates of the relative value of IMPT versus IMRT. To obtain an understanding of the value of competing modalities of RT, our institution developed a platform to combine process mapping from industrial engineering and TDABC from accounting to capture the physical time it takes to render each activity at the patient level to estimate the true costs of providing care11,20.

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"In this study, we applied TDABC and the concepts of value-based competition to communicate the value of chemoradiation strategies with IMPT or IMRT within the context of a prospective, randomized controlled trial (RCT)."

Our costing analyses for IMPT versus IMRT initially predicted a higher cumulative TDABC cost for IMPT, given the higher per fraction and delivery costs. However, modeled costs do not take into account clinical heterogeneity and the true outcomes of patient care. Conversely, comparison of the two treatment plans demonstrated that IMPT would lead to lower doses to the oral cavity, brainstem, and larynx. In theory, these lower doses could translate to less swallowing difficulty, weight loss, and morbidity during the course of RT, but the lack of head-to-head clinical comparison data makes it difficult to attach clinical certainty to these theoretical gains. Our study endpoint of cumulative TDABC costs is therefore a valid and objective analytical endpoint, because increased toxicity should directly trigger additional clinical service costs that can then be prospectively captured utilizing the TDABC approach.

To estimate the comparative resource consumption of these competing technologies, we plotted cumulative TDABC costs sequentially from either initial consultation or simulation to the end of RT. Interestingly, the IMRT patient had a longer delay to the beginning of RT due to the desire to re-evaluate his treatment options outside of this institution. The resulting delay of approximately one month triggered re-consultations and re-staging studies upon return to the institution, further increasing the cost of care beyond that which was modeled for IMRT. In our case analysis, radiation beam path toxicities due to the higher radiation doses to the oral cavity, larynx, and brainstem for the IMRT patient did indeed lead to worse QOL and higher costs, namely the need for a feeding tube, re-simulation for RT treatment22–25, supportive care, and nutritional support. In both TDABC analyses, the higher costs of IMPT delivery were overshadowed by these additional clinical costs for the IMRT patient. Even if cancer control rates were similar, the path with which patients achieve that outcome (ie, patient-reported outcomes, QOL, delay to return to work, etc.) is also important. In our study, IMRT resulted in 20% higher cost than IMPT during the entire care cycle.

Furthermore, IMPT cost just 6% more than IMRT during the course of RT, with improved QOL and patient-reported outcomes. Our results suggest that IMPT could result in higher-value therapy than IMRT. Prospective implementation of TDABC within the context of this RCT also allowed us to track resource utilization in real-time and provided insight into the areas of excess cost, opportunities for improving the efficiency of trials, and utilization capacity of RT resources.

We are currently evaluating the flow of resources within our RCT to create quality benchmarks that will further improve the efficiency of our clinical trials and lower costs.

Although TDABC is a promising tool for measuring the true costs of delivering care, institutional implementation can be challenging. Accurate analyses depend upon comprehensive process mapping for each of the clinical pathways involved in a patient’s cycle of care. This process is resource intensive and institution-specific. However, the data gleaned from these analyses can be immediately used by many health-care professionals to understand current processes and develop more efficient clinical care pathways.

At our institution, health-care providers and staff from various clinical areas collaborated to create baseline process maps.

These meetings provided a unique opportunity to discuss more integrated and efficient clinical practice pathways.

Based on feedback at the provider level, TDABC was also used to estimate the costs associated with proposed process improvements.

Additionally, this study illustrates how TDABC can facilitate reporting of outcome and cost data of cancer services on an ongoing basis. Cancer centers will soon be expected to publically report metrics of outcomes, costs, processes of care, 27

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efficiency, and patient-reported outcomes. Public reporting of this data can lead to improved competition in the healthcare marketplace and, as a result, improved value. However, an understanding of the clinical outcomes specific to the disease process will be necessary. Even if survival outcomes are comparable between the two modalities, such as IMPT and IMRT, minimizing both acute and chronic treatment-related side effects and maximizing QOL during and after treatment are paramount. A robust system will be needed to collect data and report measures that are meaningful reflections of high-value care. TDABC is already being implemented by other systems to report outcomes and costs of RT services26 and represents a mechanism for international cross-healthcare system analysis for any new RT technology in addition to IMPT. TDABC analyses may also facilitate the development of novel reimbursement models, such as payments for a bundle of patient care services (ie, bundled payments) or for all care during the cycle of patient care (global or episodebased payments) 27. Recent studies have suggested that bundling payments for episodes of care had the greatest potential for reducing costs of healthcare28 and will be in place within the next five years for cancer care27. In this bundled payment system, providers would negotiate with payers for the reimbursement of the entire cycle of patient care. Successful negotiations will rely on providers’ accurate estimation of the true costs of delivering patient care to maintain a viable margin and determine a sustainable price. Bundling of services will therefore encourage process mapping, cost analyses, and reporting of performance metrics. Similarly, insurers will require value measurement tools to decide which providers deliver high-value services, and what prices would be reasonable for the outcomes

O

achieved. The results of our study can help the cancer community understand the cost of providing competing treatments, such as IMRT and IMPT, thereby allowing a rational approach to designing episode-based payments.

Although bundling can better align incentives for coordinated cancer care, bundling also leads to the complex task of “unbundling” the costs of various constituent clinical services provided to the patient over the care cycle. TDABC can once again be implemented here to measure the contribution of specific services based on the time expended for patient care, thereby allowing an equitable division of the global payment.

CONCLUSION

TDABC is an innovative costing methodology tool that can be used to define the value of competing innovative technologies over the entire cancer care cycle. In this proofof-principle study, the episodic cost of care using an IMPTbased treatment strategy in a patient with advanced stage oropharynx cancer was less costly and of higher value than IMRT. These data can be used to understand the true cost of care delivery at the provider level and may be utilized in discussions with patients, payers and policy makers to communicate the value of cancer care services. As we move towards global payment models and public reporting of outcomes and costs, competition will drive change in our health-care delivery system. However, an incomplete understanding of the value of novel technologies with higher implementation costs could impede innovation and improvements in cancer care. Future efforts will require comprehensive accrual of TDABC data as we move forward from case studies to more robust estimators of resource use and value-based health-care delivery metrics.

REFERENCES

Correspondence:

Steven J. Frank, M.D.,

Department of Radiation Oncology, Unit 0097, The University of Texas MD Anderson Cancer Center, 1515 Holcombe Boulevard, Houston, TX 77030

(sjfrank@mdanderson.org).

Conception and design: N.G.T., S.J.F., T.W.F., R.S.W.

Collection & assembly of data:

N.G.T., S.J.F., D.I.R., A.S.G., G.B.G., C.D.F., J.R.I., C.K.

Data analysis & interpretation: N.G.T., S.J.F., A.B.G., T.M.J., L.S.T., J.R.I., C.K., M.B.P., S.B.C.

Manuscript writing: N.G.T., S.J.F., T.W.F.

Final approval of manuscript:

N.G.T., S.J.F., D.I.R., A.S.G., G.B.G.,

C.D.F., M.B.P., A.B.G., T.W.F., T.M.J., L.S.T., R.S.W., J.R.I., C.K., S.B.C.

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Med Dosim. 2014;39(1):34–37.

23. Duma MN, Kampfer S, Schuster T, Winkler C, Geinitz H. Adaptive radiotherapy for soft tissue changes during helical tomotherapy for head and neck cancer. Strahlenther Onkol. 2012;188(3):243–247.

24. Capelle L, Mackenzie M, Field C, Parliament M, Ghosh S, Scrimger R. Adaptive radiotherapy using helical tomotherapy for head and neck cancer in definitive and postoperative settings: initial results.

Clin Oncol (R Coll Radiol). 2012;24(3):208–215.

25. Jensen AD, Nill S, Huber PE, Bendl R, Debus J, Munter MW. A clinical concept for interfractional adaptive radiation therapy in the treatment of head and neck cancer.

Int J Radiat Oncol Biol Phys. 2012;82(2): 590–596.

26. KCE. Innovative Radiotherapy Techniques: A Multicentre Time-Driven Activity-Based Costing Study. KCE Report 198C; 2013.

27. Emanuel E, Tanden N, Altman S, et al. A systemic approach to containing health care spending. N Engl J Med. 2012;367(10): 949–954.

28. Hussey PS, Eibner C, Ridgely MS, McGlynn EA. Controlling U.S. health care spending – separating promising from unpromising approaches. N Engl J Med. 2009;361(22):2109–2111.

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HTTP://OPPP.US

O

ONCOLOGY PAYERS

ORAL AGENTS IN

COLORECTAL CANCER:

Perspectives for Patients, Providers, and Payers

ABSTRACT Introduction

Colorectal cancer (CRC) is one of the

most common malignancies worldwide.

Fluoropyrimidine (5-FU) based chemotherapy

is the backbone of therapy and both single and combination regimens improve survival in both

Nisha A. Mohindra, M.D.,

Sheetal M. Kircher, M.D., M.S., Halla Nimeiri, M.D., and Al B.

Benson, III, M.D., FACP, FASCO From the Division of

Hematology-Oncology,

Department of Medicine, Northwestern University

Feinberg School of Medicine,

the adjuvant and metastatic settings. However,

Chicago, Illinois (N.A.M.);

oral chemotherapy agents are emerging in

and Department of Medical

the field and will ultimately offer an alternative route and method of treatment to traditional

intravenous (IV) therapy. Within CRC, capecitabine and regorafenib are two oral chemotherapy options that have gained Food and Drug

Administration (FDA) approval, with several more

Oncology, Robert H. Lurie

Comprehensive Cancer Center, Northwestern University

Feinberg School of Medicine,

Chicago, Illinois (A.B.B., S.M.K., H.N.).

Submitted June 14, 2014;

revised June 30, 2014; accepted

in development.

July 3, 2014

Areas covered

Keywords:

This article reviews the efficacy and toxicity

neoplasms/drug therapy; drug costs;

oral chemotherapy; colorectal

profiles of capecitabine and traditional IV 5-FU

patient adherence

regimens as well as the evidence leading to

Corresponding author:

approval of regorfenib. It also discusses important

Al B. Benson, III, M.D., F.A.C.P.,

factors when considering oral chemotherapeutic

Robert H. Lurie Comprehensive

F.A.S.C.O., Medical Oncology,

options, such as patient preferences, adherence,

Cancer Center, Northwestern

monitoring of side effects, and cost based on

Medicine, 676 North Saint Clair,

Medicare coverage.

Conclusions

Oral chemotherapy agents in colon cancer

University Feinberg School of Suite 850, Chicago, 60611 IL

Take away points: There is a rising interest in developing oral chemotherapy for treatment of several malignancies, with hopes that these agents will offer a more convenient, yet comparably effective, means of therapy. Careful selection of patients appropriate for oral chemotherapy is of utmost importance for successful implementation of these agents into regular use. Additionally, the use of multidisciplinary teams improves patient compliance, ensures safety, and avoids misuse and drug–drug interactions that can lead to serious adverse events.

• Oral chemotherapy is a viable option for select patients in colorectal cancer and may improve quality of life and reduce direct and indirect medical costs.

• Patient education, support systems, and measures to improve compliance and safety must be instituted to ensure successful implementation of oral chemotherapy into the treatment armamentarium.

• ‘Out of pocket’ costs for oral chemotherapy agents differs depending on type of Medicare coverage.

• Improving physician re-imbursements and creating a cost structure for support systems with oral chemotherapy will be important as more of these agents enter the market.

(abenson@nmff.org).

Conception & design:

Collection & assembly of data:

have demonstrated efficacy and safety and

Data analysis & interpretation:

have the potential to offer patients improved

Final approval of manuscript:

Manuscript writing:

convenience and home-based therapy. As more

NAM, SMK, ABB

oral chemotherapy options emerge in the market,

10.13032/oppp.2052-5931.100006

innovative health system provisions must be in

place to closely monitor patients for adherence and toxicity and we must restructure the financing of oral chemotherapy to provide high-quality, affordable treatment options.

HTTP://OPPP.US

29

ONCOLOGY PAYERS

Colorectal cancer (CRC) is one of the most common malignancies worldwide.1 In the USA, CRC ranks among the top three most common cancers for both men and women and is the third leading cause of cancer-related death.2 Fluoropyrimidine (5-FU)-based chemotherapy is the backbone of therapy and both single and combination regimens to improve survival in both the adjuvant and metastatic settings. The addition of targeted agents directed against molecular mechanisms of tumor growth and tumor-mediated angiogenesis has demonstrated clinical efficacy when used in patients with advanced disease.

Despite its benefits, infusional 5-FU is associated with increased patient burden, frequent clinic visits, and increased home health costs associated with pump care. These patientcentered issues are not unique to CRC but resonate among much of oncology, where the majority of chemotherapy is administered intravenously.3 Over the last three decades, there has been a great deal of interest in offering more chemotherapeutic agents orally. Currently, as many as 25% of all cytotoxic agents can be administered orally,4 with several other cytotoxic and novel/targeted agents in development.5 We will address some of the factors associated with oral chemotherapeutic agents in CRC, specifically treatment efficacy and toxicity, patient-centered issues, and financial considerations (see Table 1).

CLINICAL EFFICACY AND COMPARISON OF TOXICITY There are currently two Food and Drug Administration (FDA)-approved oral chemotherapeutic agents utilized in CRC-capecitabine, an oral prodrug to 5-FU, and regorafenib, a multi-tyrosine kinase inhibitor. There are a number of other oral alternatives to 5-FU (such as S-1, uracil and tegafur [UFT], doxifluridine) 6 that are used outside of the USA.

Capecitabine Capecitabine is a carbamate form of fluoropyrimidine that was rationally designed to be converted into 5-FU preferentially in tumor tissue.7 Capecitabine is catalyzed into 5-FU in three enzymatic steps and utilizes the location of these enzymes to improve efficacy and reduce toxicity compared to 5-FU and other oral 5-FU derivatives.

Specifically, capecitabine is absorbed by the intestine in the prodrug form, thereby reducing gastrointestinal side effects from the active metabolite form, and then is sequentially converted in the liver and tumor tissue into 5-FU.7 The final step of the cascade occurs through the enzyme thymidine phosphorylase, which is more active in tumor tissue than in healthy tissue.8 Capecitabine is administered twice a day to mimic the pharmacokinetics of continuous infusional therapy.

30

"Oral chemotherapy is a viable option for select patients in colorectal cancer and may improve quality of life and reduce direct and indirect medical costs."

Capecitabine has been evaluated as both monotherapy and in combination with oxaliplatin in the adjuvant setting. Single agent capecitabine is at least equivalent to the Mayo Clinic regimen of 5FU/LV with respect to 3-year disease-free survival (DFS) (HR: 0.87, 95% CI: 0.75–1, P < 0.001) and OS (HR: 0.84, 95% CI: 0.69–1.01, P < 0.001), which persisted on extended follow-up (median 6.9 years) and among patients greater than 70 years old.9,10 Treatment with capecitabine was associated with a more favorable toxicity profile than 5FU/LV and demonstrated a trend toward improved OS in versus 5-FU/LV (71.4% versus 68.4%, respectively, P = 0.06).

Furthermore, the addition of oxaliplatin to capecitabine in adjuvant therapy has resulted in improved 3-year DFS compared to standard adjuvant 5FU/LV therapy, such as the Roswell Park and Mayo Clinic regimens (70.9% (95% CI: 67.9–73.9) and 66.5% (95% CI: 63.4–69.6), respectively).11 Currently, capecitabine and capecitabine/oxaliplatin are acceptable adjuvant therapies for resected colon cancer patients and are incorporated in National Comprehensive Cancer Network (NCCN) guidelines.12 In the first-line metastatic setting, capecitabine has been compared to the Mayo Clinic bolus 5-FU/leucovorin (LV) regimen in two large randomized trials.13–15 Patients treated with capecitabine had at least equivalent overall response rates when compared to those treated with 5-FU/LV in both trials, with one trial detecting a modestly higher response rate within the capecitabine arm (25% vs. 16%, P = 0.005 for one trial and 18.9% vs. 15% for the other trial). Furthermore, an integrated analysis of the two studies showed that higher overall response rate was achieved with capecitabine compared with 5-FU/LV (26 vs. 17%, P < 0.0002). This evidence led to FDA approval of capecitabine for monotherapy in metastatic colon cancer when treatment with a fluoropyrimidine is preferred.16 Capecitabine, however, has not been compared to infusional FU, either as a continuous infusion or as a 46-hour infusion given every 2 weeks.

Furthermore, the combination of capecitabine and oxaliplatin (CapeOx) has also been shown to be noninferior to 5FU/LV/oxaliplatin containing regimens with respect to response rate (RR), progression-free survival (PFS), and overall survival (OS) for first-line treatment of metastatic colon cancer17–22 and in the second-line setting for patients progressing on irinotecan-based chemotherapy23. As such, CapeOx is often used interchangeably for 5-FU, leucovorin, and oxaliplatin (FOLFOX).12 Even with the addition of the antiangiogenic agent bevacizumab, CapeOx and FOLFOX yielded similar results.12,24,25 Conversely, the combination of capecitabine plus irinotecan has been associated with increased adverse events and toxicity, thus it is not recommended for treatment in the USA.12,26

Toxicity The most commonly experienced adverse reactions to HTTP://OPPP.US

ONCOLOGY PAYERS

these factors have been evaluate prospectively. This has Patient led to theconsiderations use of lower doses of capecitabine in the US population compared to that of other parts of the world.

Other factors to consider teams with capecitabine use include - Use of multidisciplinary (nurses, pharmacists) careful monitoring of renal as decreased renal to monitor side effects andfunction, improve patient education function can lead to 5-FU toxicity, and drug–drug - Patient logsthat (phone, internet surveys, symptom logs) interactions can produce adverse events.

Patient considerations Pros

No need for IV access

Convenience of treatment Decreased nonmedical costs of care (wait time to see a physician, infusion time, travel time to clinic visits)

AUTHORS’ DISCLOSURES OF POTENTIAL CONFLICTS OF INTEREST The authors indicated no potential conflicts of interest.

- Physician counseling regarding clinical evidence

- Institution of formal processes to monitor safety Other Oral 5-FU Prodrugs

Con’s Pill burden

Complexity of medication instructions

Larger burden of care on patient

Concerns regarding efficacy Cost

UFT is the combination of tegafur, a slow release - Providing patients with support kits 5-FU prodrug, and uracil. Tegafur was developed to increase index 5-FU through slow - Reformthe of therapeutic reimbursement for of chemotherapy conversion into activated form in the liver. Uracil was added to tegafur in an effort to increase plasma and tumor concentrations of 5-FU by competitively inhibiting degradation of 5-FU by dihydropyrimidine dehydrogenase (DPD).31 When tegafur was first evaluated in the USA in IV form, it provided little clinical benefit and was associated with increased central nervous system toxicity due to accumulation of the metabolite hydroxybutyrate. Therefore, it was not approved for use in the USA based on these findings.32 However, when evaluated in Japan in oral form, a prolonged 28-day cycle of tegafur showed significant activity in advanced colon cancer and had very few side effects.33,34 UFT has been actively used in Japan for decades in treatment of advanced colon cancer and more

Health professional considerations Pro’s Increased patient satisfaction

Potentially fewer hospitalizations

management of side effects Con’s Noncompliance/sub-optimal outcomes

Missed medication side effects

Drug/drug interactions

Medication errors/over compliance Reimbursement

Utilization of other health care resources

that cannot be billed TABLE 1. ORAL CHEMOTHERAPY FROM PATIENT AND PHYSICIAN PERSPECTIVES.

treatment with capecitabine are diarrhea, nausea, vomiting, cutaneous hand–foot syndrome, and hyperbilirubinemia.16 In both the metastatic and adjuvant setting, capecitabine had an acceptable, if not favorable, toxicity profile compared to 5FU/LV regimens.15,27 Integrated analysis of the 1207 patients from the two large studies comparing capecitabine to bolus 5FU/LV in first-line treatment of metastatic disease demonstrated fewer patients in the capecitabine group experienced diarrhea, stomatitis, nausea, neutropenia, and alopecia compared to 5-FU/LV (P <0.001); however hand–foot syndrome occurred more frequently in the capecitabine arm (P < 0.001).13–15 Fewer grade 3 adverse events, largely due to hand–foot syndrome and diarrhea, were more common in the capecitabine group, but grade 4 adverse events were more common with 5-FU/LV due to neutropenia and diarrhea. Overall, fewer patients treated with capecitabine were hospitalized with an adverse reaction (12% vs. 18%, P < 0.005) and hospitalizations for neutropenia and stomatitis only occurred in the 5-FU/LV group. Grade 3 hyperbilirubinemia was the only lab abnormality that occurred more frequently in the capecitabine group (18% vs.

3%; P <0.001); however, the hyperbilirubinemia was typically not associated with long-term hepatobiliary abnormalities.

The adverse events that most commonly led to treatment cessation or dose reduction were hand–foot syndrome and diarrhea for the capecitabine group, and stomatitis and diarrhea for the 5-FU/LV group. Interestingly, there is now evidence to suggest an association between the development of hand–foot syndrome from capecitabine treatment and better clinical outcomes for patients with colon cancer, including improved OS.10,28 In general, patients from the USA have been found to have more complications and adverse events with fluoropyrimidine therapy than patients from the rest of the world.29,30 A variety of possible reasons have been suggested, such as differences in polymorphisms in CYP2A6, increased dietary folate intake due to fortified foods, body mass index, and tendency to continue medication despite side effects; however, none of HTTP://OPPP.US

recently in the adjuvant setting as well. The National Surgical Adjuvant Breast and Bowel Project (NSABP) CO-6 trial found that oral UFT plus LV was as effective as weekly IV fluorouracil (FU) plus LV in extending DFS and OS when used as adjuvant therapy in patients with stage II and III CRC.35 S-1 is a combination of tegafur, gimeracil (a more potent inhibitor of DPD than uracil) and oxonic acid (an inhibitor of phosphoribosyl transferase the enzyme that phosphorylates 5-FU preferentially in the gastrointestinal tract).36 S-1 is used in both Europe and Japan for treatment of many malignancies including gastric cancer and colon cancer.37 S-1 has been evaluated in combination with agents such as irinotecan, oxaliplatin, and bevacizumab, and has produced at least equivalent results to their 5-FU comparator arms with an acceptable toxicity profile. This agent is not currently FDA approved in the USA.

Regorafenib Regorafenib is a multi-kinase inhibitor of signals involved in tumor growth and angiogenesis, such as RET, VEGFR1,2,3, PDGFR-alpha and beta, FGFR1,2, and BRAF.38 Treatment with regorafenib has shown a modest but statistically significant, survival benefit compared to placebo (6.4 months vs. 5 months, respectively) for patients with advanced colon cancer who have progressed on all standard therapy (HR: 0·77; 95% CI: 0.64–0.94; p = 0.0052).39 Most patients treated with regorafenib experienced a treatment-related adverse event (93% in the regorafenib group vs. 61% in the placebo group).

The most common grade 3 or higher AE’s were hand–foot syndrome (17%), fatigue (10%), diarrhea (7%), hypertension (7%), and rash or desquamation (6%). Despite only a slight survival benefit, regorafenib provides a much-needed option for patients with refractory or kirsten rat sarcoma viral oncogene homolog (KRAS) mutant disease, and was thus approved by the FDA in 2012. Unfortunately there still lacks a prognostic marker to enable optimal selection of patients who might best benefit from this regimen.

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ONCOLOGY PAYERS

Part B

Part D

What is covered - IV chemotherapy administered - Oral anticancer medication with no as an outpatient injectable equivalent

- Oral anticancer medication with an IV equivalent

Cost for capecitabine is based on Medicare October 2013 ASP Drug Pricing file. Cost of regorafenib is based on the wholesale price.

Capecitabinea Cost of one cycle of therapy

$3,059 for a 3-week cycle

Amount patient may owe

$611 for a 3-week cycle (cost sharing of 20%)

Regorafenib Cost of one cycle of therapy

$9350 for a 28 day cycle

Amount patient may owe

$465 (cost sharing of 5%)

TABLE 2. PATIENT COST FOR CHEMOTHERAPY BASED ON TYPE OF MEDICARE COVERAGE.

PATIENT-CENTERED FACTORS Oral chemotherapy offers several advantages to patients, such as increased convenience, autonomy, and fewer clinic visits; however, there factors that need to be addressed when considering this route of therapy, such as patient perceptions, adherence, and safety monitoring.

Patient Preference/Perceptions Particularly in the palliative setting, patients prefer oral chemotherapy to IV therapy as it is more convenient, there are less issues with venous access, and patients are able to receive treatment at home.40,41 In a randomized crossover trial for patients with metastatic colon cancer, patients were treated with one cycle of capecitabine and then one cycle of IV 5-FU/LV, or the reverse order, and then asked to decide which treatment they preferred. The majority of patients preferred therapy with capecitabine over 5FU (57% of patients expressed a preference for capecitabine and 32% for 5FU/LV).42 When capecitabine was preferred, the most cited reasons were convenience of treatment and tablet formulation; whereas in the 5FU/LV group, the major reason was fewer side effects. Oral options also alleviate indirect costs such as time off work and travel for IV treatment.43 Nevertheless, patients are unwilling to sacrifice efficacy or duration of therapy response for convenience.40 While many patients understand and value the “freedom” that oral therapy provides, there remains a small population of patients that question whether oral therapy represents a “last resort.”44 For these patients, it is necessary to emphasize the efficacy data of oral options in greater detail.

Adherence/Safety Monitoring One of the major factors to consider with oral chemotherapy is patient adherence, as noncompliance can negatively impact clinical outcomes and increase health-care costs.45,46 Several factors influence compliance, including chronicity of treatment, education, scheduling (number of times a day to take pills), and number of pills taken daily.4,45–47 It has been suggested that limiting the number of pills to a maximum of 6–8 tablets per day along with a simple dosing schedule can improve compliance rates.3 In the case of capecitabine, the dose of single agent treatment in the metastatic setting is 1250 mg/m2 twice a day (2500 mg/m2 daily). Tablets are in 150 mg and 500 mg formulations; therefore, patients take at a minimum of 5–6 tablets a day. Doses of capecitabine are taken 12 hours apart and within 30 minutes of eating a meal, adding complexity to the regimen.16 Despite the importance 32

of cancer treatment to many oncology patients, compliance rates with oral chemotherapy range from 20 to 100%.48 There is risk of “over compliance” to oral chemotherapy and patients may continue treatment even in “off weeks” to improve hypothetical efficacy or continue treatment despite side effects.48–50 As oral chemotherapeutic agents are increasingly utilized, strategies to improve adherence and monitor safety are of utmost priority.51 There is a lack of standardized patient education and systematized methods to monitor adherence, side effects, and adverse reactions. A survey of 42 cancer centers is the USA found that almost a quarter (10 out of 42) of centers had no formal process for monitoring patients’ adherence.52 Ways to improve these shortcomings have focused on multidisciplinary teams, patient education, facilitating communication (through internet based approaches, surveys, symptoms logs), and providing patients with support kits to deal with adverse events.46,49,51,53

FINANCING AND COST CONSIDERATIONS The high cost of many oral chemotherapeutics introduces challenges in financing and reimbursement to a field that has traditionally only dealt with IV drugs. Substantial cost savings can be seen when IV therapy is replaced with oral capecitabine therapy.54–57 When compared to the Mayo regimen of 5FU/ LV, patients receiving capecitabine in the first-line metastatic setting had a significant decrease in resource utilization with fewer hospital or outpatient visits for IV administration, less expensive drug therapy for side effect management, and fewer hospitalizations due to side effects.54 Some have argued, however, that the savings in administration costs is offset by the increase cost and utilization needed for education, phone consultations, and monitoring of oral chemotherapy at home which is often not billable by healthcare providers.58 The financing and insurance coverage of oral chemotherapy are often confusing and the amount of cost sharing varies widely between insurers. Unlike IV chemotherapy that is covered under the medical benefit component of insurance plans, most oral anticancer medications (OAM) are covered by prescription drug plans. There is significant variation among each insurance plan and typically IV chemotherapy and OAMs have different copayment or coinsurance amounts and patient may be subject to significant cost sharing. The effects of high cost sharing for cancer treatment can lead to the inability to afford basic needs,59,60 nonadherence with medications,59,60 and even bankruptcy.59 HTTP://OPPP.US

ONCOLOGY PAYERS

Medicare covers 61% of new cancer patients in the USA, and that proportion is expected to rise to 70% by 2030 as the population ages.61 Medicare is administered by the Centers for Medicare and Medicaid and is comprised of two components involved in financing oral chemotherapy (see Table 2).

Medicare Part B Medicare Part B covers outpatient doctor services, durable medical equipment, and IV chemotherapy administered in the outpatient setting. Under Part B, after reaching a $147 deductible in 2014, patients pay 20% coinsurance with no maximum spending limit for the year. A limited list of OAMs for which there are injectable equivalents is covered under Part B (eg, capecitabine). Medicare approved drug costs are based on the Manufacturerâ&#x20AC;&#x2122;s Average Sales Price (ASP). For example, capecitabine is FDA-approved drug to treat metastatic CRC at a dose of 1250 mg/m2 twice a day for 14 days of a 21-day cycle and because it has an IV equivalent, it is covered under Part B. For a typical patient, a reasonable dose is 2000 mg twice a day for 14 days of a 21-day cycle. According to the October 2013 ASP Drug Pricing files, the ASP for capecitabine is $32.19 per 500 mg tablet. Therefore, the total cost based on Medicareâ&#x20AC;&#x2122;s allowance limit is $3059 for one cycle. The patient is responsible for 20% of that cost, or $611 for a three-week cycle. Eighttwo percent of Medicare beneficiaries have supplemental insurance, such as Medigap, an employer-sponsored plan, Medicare Advantage, or Medicaid that offset coinsurance or copays.62 As a result, IV chemotherapy and the limited number of OAMs under Part B are typically affordable for patients.

Part D Part D provides prescription drug coverage for patients who have Medicare insurance, and similar to Part B, it is an optional part of Medicare. The majority of oral chemotherapeutics and biologics do not have an injectable

HTTP://OPPP.US

equivalent so their coverage is subject to Part D rules, as in the case of regorafenib in CRC. While the premiums, formularies, and copayments all vary across Part D prescription plans, all patients could reach a coverage gap (donut hole) at some point during the year. High cost OAMs, such as regorafenib has an average wholesale price of $9350 per 28 day cycle63 ; even a small amount of cost sharing of 5% ($465 a cycle) is unaffordable for many patients. The structure of the coverage gap in Part D will undergo significant change under the Affordable Care Act (ACA), which aims to gradually close this donut hole by 2020.64 In addition, the ACA imposes maximum individual and family annual limits on out-of-pocket (OOP) costs for all services (In 2014, $6,350 and $12,700, respectively).

From a provider perspective, helping patients to access and afford OAMs currently is a regular struggle that requires significant time for both physicians and allied health professionals at most offices and cancer centers. Applications for foundation and pharmaceutical company grants are frequently required, donated drugs are used, and treatments can be delayed due to denial of insurance coverage.65 From a reimbursement standpoint, approximately 80% of oncology revenues are largely based on the delivery of parenteral agents.51 In contrast, oncologists do not derive revenue from oral chemotherapy independent of the fees received from office visits needed to monitor care.51

CONCLUSIONS As therapy evolves for treatment of CRC, oral agents will most certainly increase in number and use. Oral chemotherapy agents in CRC have been proven efficacious and safe, with added benefit of being able to offer patients improved convenience and home-based therapy. Innovative health systems must be in place to closely monitor patients for adherence and toxicity and we must restructure the financing and reimbursement of oral chemotherapy to provide highquality, affordable treatment options.

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32. Friedman MA, Ignoffo RJ. A review of the United States clinical experience of the fluoropyrimidine, ftorafur (NSC-148958). Cancer Treat Rev. 1980;7(4):205–213.

33. Pazdur R, Lassere Y, Diaz-Canton E, Ho DH. Phase I trial of uracil-tegafur (UFT) plus oral leucovorin: 28-day schedule. Cancer Invest. 1998;16(3):145–151.

34. Pazdur R, Lassere Y, Rhodes V, et al. Phase II trial of uracil and tegafur plus oral leucovorin: an effective oral regimen in the treatment of metastatic colorectal carcinoma. J Clin Oncol. 1994;12(11):2296–2300.

35. Lembersky BC, Wieand HS, Petrelli NJ, et al. Oral uracil and tegafur plus leucovorin compared with intravenous fluorouracil and leucovorin in stage II and III carcinoma of the colon: results from National Surgical Adjuvant Breast and Bowel Project Protocol C-06. J Clin Oncol. 2006;24(13):2059–2064.

36. Shirasaka T, Shimamato Y, Ohshimo H, et al. Development of a novel form of an oral 5-fluorouracil derivative (S-1) directed to the potentiation of the tumor selective cytotoxicity of 5-fluorouracil by two biochemical modulators. Anti-cancer Drugs. 1996;7(5):548–557.

37. Malet-Martino M, Martino R. Clinical studies of three oral prodrugs of 5-fluorouracil (capecitabine, UFT, S-1): a review. Oncologist. 2002;7(4):288–323.

38. Stivarga (regorafenib) [package insert]. Wayne, NJ: Bayer; Revised 9/2012.

39. Grothey A, Van Cutsem E, Sobrero A, et al. Regorafenib monotherapy for previously treated metastatic colorectal cancer (CORRECT): an international, multicentre, randomised, placebo-controlled, phase 3 trial.

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40. Liu G, Franssen E, Fitch MI, Warner E. Patient preferences for oral versus intravenous palliative chemotherapy. Jo Clin Oncol. 1997;15(1):110–115.

41. DeMario MD, Ratain MJ. Oral chemotherapy: rationale and future directions. J Clin Oncol. 1998;16(7):2557–2567.

42. Twelves C, Gollins S, Grieve R, Samuel L. A randomised cross-over trial comparing patient preference for oral capecitabine and 5-fluorouracil/leucovorin regimens in patients with advanced colorectal cancer. Ann Oncol. 2006;17(2):239–245.

43. Yabroff KR, Warren JL, Knopf K, Davis WW, Brown ML. Estimating patient time costs associated with colorectal cancer care. Med Care. 2005;43(7):640–648.

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45. Osterberg L, Blaschke T. Adherence to medication. New Engl J Med. 2005;353(5):487–497.

46. Accordino MK, Hershman DL. Disparities and challenges in adherence to oral antineoplastic agents. Am Soc Clin Oncol Educ Book. 2013:271–276.

47. Bassan F, Peter F, Houbre B, et al. Adherence to oral antineoplastic agents by cancer patients: definition and literature review. Eur J Cancer Care. 2014;23(1):22–35.

48. Partridge AH, Avorn J, Wang PS, Winer EP. Adherence to therapy with oral antineoplastic agents. J Natl Cancer Inst. 2002;94(9):652–661.

49. Halfdanarson TR, Jatoi A. Oral cancer chemotherapy: the critical interplay between patient education and patient safety. Current Oncol Reports. 2010;12(4):247-252.

50. Cassidy J. Benefits and drawbacks of the use of oral fluoropyrimidines as single-agent therapy in advanced colorectal cancer. Clin Colorectal Cancer. 2005;5(suppl 1):S47–S50.

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ONCOLOGY PAYERS

THE 340B PROGRAM'S

VITAL ROLE ABSTRACT The little-known 340B drug discount program plays a key role in helping hospitals that treat high numbers of underserved and rural oncology patients. From the inner city of Detroit to the small towns of Michigan and Kentucky, the program provides an invaluable mechanism for the delivery of quality cancer care as well as discounted medicines and free clinical services.

For many hospitals, the savings afforded by 340B are essential to keeping oncology programs running – and their doors open. The drug industry is eager to scale back the program.

Some private oncologists have attacked 340B and blame it for driving hospital purchases of their practices as well as higher prices. In reality, hospital/private-practice mergers of all kinds are driven by economic forces associated with the changing health-care landscape – particularly low insurance reimbursements. Private practitioners also have the luxury of sending their poorest patients to safety-net providers for treatment.

in Oncology Care

Robert Chapman, M.D., and William Wood, R.Ph. From Josephine Ford Cancer Institute at Henry Ford Health System, Detroit, Michigan (R.C.); and Aspirus Ontonagon Hospital, Ontonagon, Michigan (W.W.).

Submitted June 17, 2014; accepted June 27, 2014 Keywords: 340B drug discount program; oncology; hospital Corresponding author: C. Lyn Fitzgerald, M.J., National Comprehensive Cancer Network, 275 Commerce Drive, Suite 300, Fort Washington, Pennsylvania 19034 (fitzgerald@nccn.org).

Conception & design: RC, WW Collection & assembly of data: N/A Data analysis & interpretation:

Every day across America, the 340B drug discount program helps safety-net hospitals and clinics care for cancer patients. In rural and urban settings alike, the program has an enormous impact as patients receive quality attention close to home and at a reasonable cost – in many cases for free.

Savings achieved through 340B are also critical to enabling health-care facilities that serve high volumes of indigent care to provide other vital services such as diabetes, HIV, and transplant care. This is exactly what Congress intended when it created the program in 1992 and reaffirmed its purpose last year.1 There has been considerable controversy about the 340B drug discount program in the media lately, largely driven by the pharmaceutical industry which is eager to see it scaled back – or dismantled. Some private-practice oncologists have also criticized 340B, convinced the program is driving practitioners into the arms of hospitals or somehow degrading the quality of patient care. From our vantage point in the trenches, we see nothing to validate these charges.

Here is how the program works. Under federal law, pharmaceutical companies are required to provide drug discounts of between 20 and 50% to health-care providers that serve large numbers of poor people. Hospitals, in turn, pass on those savings to uninsured patients. They also provide the discounted medicines to insured patients and are reimbursed by insurance companies at negotiated rates.

Hospitals use their savings to fund clinics and services to help vulnerable populations.

Manuscript writing: Final approval of manuscript: RC, WW 10.13032/ oppp.2052-5931.100007

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THE PICTURE AT RURAL HOSPITALS Aspirus Ontonagon Hospital is a 25-bed facility near the Lake Superior shore. The facility was struggling and nearly closed due to steady financial losses. It enrolled in 340B in 2010, the first year it was eligible, and in early 2012, contracted with the town’s only retail pharmacy to sell drugs purchased at 340B discounts to outpatients at insured rates.

The arrangement allowed Aspirus Ontonagon to accrue muchneeded savings.

This model is exactly what Congress wanted when it created the 340B program. For Aspirus Ontonagon, 340B was not only critical to saving the facility but it also enabled the Critical Access Hospital to provide cancer care in the community. In late 2012, the hospital was able to open a clinic staffed by a full-time oncology certified nurse and a part-time oncologist. Its existence means patients no longer have to travel up to 150 miles away, or even out of state, for cancer treatment.

Aspirus Ontonagon is also using its 340B savings to ensure that cancer patients in the community are able to pay for their medications. Those who are insured get help understanding their coverage and those who are not find out if they qualify for free or reduced cost services. In one recent example, an uninsured patient saved more than $36,000 over the course of her cancer regimen, thanks to help from the hospital.

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ONCOLOGY PAYERS

Take away points: The 340B drug discount program is vital for hospital-based oncology programs that treat underserved and rural populations: • It funds discounted meds and services for poor patients • It helps rural providers treat patients close to home • It allows rural hospitals to stay open • 340B is not to blame for hospital/private-practice oncology consolidation.

Taken together, the benefits created by 340B savings add up to improved outcomes through earlier diagnosis, earlier identification of therapy-related problems, and better opportunities for personal bonding among patients. No one should face cancer alone. The citizens of Ontonagon no longer have to.

MAKING A DIFFERENCE IN KENTUCKY A 57-year-old man with lung cancer lost his job as a minister when he became too sick to work. Ineligible for COBRA, he also lost his health insurance. The man’s three cancer drugs cost more than his monthly Social Security benefit of $680. Things looked up when he became a patient at KentuckyOne Health System in Louisville. It runs 10 statewide oncology clinics that are the funded by 340B savings.

Kathy Anderson, manager of the specialty pharmacy at Jewish Hospital, part of KentuckyOne, made it her business to get the patient chemotherapy at an affordable price. Ultimately, two of the medications were free; a third cost $40 a month from the hospital’s retail pharmacy. A big-box chain would have charged $286.

Kentucky leads the nation in lung cancer, and most patients are diagnosed in advanced stages of the disease. Many come to this safety-net hospital system because other providers – including private oncologists – have turned them away.

KentuckyOne has also applied some of its 340B savings to hiring six pharmacy coordinators dedicated to oncology. Three of these clinics are in Louisville and three are in rural areas. Four of the pharmacy coordinators work face to face, two of them via telephone. Their goal: tap available resources – such as the system’s charity care program; Pharmacy Plus, its retail pharmacy; and manufacturers’ assistance programs – so that patients who cannot afford treatment do not miss a dose.

The 340B program is not just about pills. It is about vital services that make medicines accessible to uninsured, underinsured, and other needy patients.

THE URBAN VIEW The Henry Ford Hospital in Detroit, MI, is an 802bed facility that serves a high percentage of uninsured and underinsured patients. It provides more than $200 million in charity and uncompensated care annually. It is a front-line hospital for cancer care and treats 14,000 oncology patients each year.

The hospital takes pride in the fact that its doctors are blind to a patient’s economic circumstances. That is thanks in large part to 340B savings that help fund oncology clinics and related services in Detroit and surrounding townships.

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The 340B program also supports non-oncology patients in the Henry Ford Hospital system. It helps underwrite the Community Health and Social Services Center that provides Detroit’s large Latino and African-American communities with primary care, dental, pediatric, perinatal, family planning, counseling, and pharmacy services.

Hennepin County Medical Center in Minneapolis treats more than 500,000 patients each year. It serves a large immigrant community of Hmong, Somali, and Hispanic individuals who make up 40% of the hospital’s patient base – and most are either on Medicaid, Medicare, or uninsured. The facility is the largest safety-net provider in the region: “Without the program, I don’t know how we would function,” said oncologist Andres Wiernik. “It is critically important for us to have access to discount medications. Otherwise there would be no way we could afford the cost of drugs.”

For patients, the hospital’s 340B savings help cover every aspect of cancer care from diagnosis to surgery to chemotherapy and radiation. These services are provided regardless of patients’ ability to pay.

The Queens Cancer Center in New York is the only comprehensive cancer center in the Health and Hospital Corporation system. Established in 2002, it treats more than 2700 cancer patients per year regardless of income. Seventy-nine percent of the center’s patients are either uninsured or on Medicaid and many are undocumented.

Discounted 340B chemo drugs are absolutely vital to keeping the center open. In the past year, it has used 330 units of Neulasta at a cost of $726,000 – instead of the $2,529,073 retail price. The center spent $549,438 on Herceptin, a considerable break from the retail price of $2,092,489. The majority of the center’s patients receive all their chemo drugs free of charge and the center absorbs the full cost of preparing and administering the medication.

“Without this program we couldn’t run the cancer center and give high quality care,” said Director Mary Margaret Kemeny, MD.

their missions, these providers must shoulder the enormous expense of treating all patients, regardless of ability to pay. 340B discounts help in this regard, but do not cover the full costs of uncompensated care.

Only 4% of patients treated by community oncologists are uninsured and the same percentage have Medicaid, according to a 2012 biopharmaceutical consulting report.2 Another study indicates that, of the patients referred by community oncologists to outside practices, 15% are uninsured and 26% are Medicaid.2 In reality, these patients end up receiving cancer care from public and non-profit 340B hospitals.

Private oncologists also blame 340B for driving consolidation. But integration of community-based physician practices and institutional providers has a long history driven by fundamental changes in our nation’s health-care system. Managed care, integrated delivery systems, capitation, and, more recently, accountable care organizations have all created financial and clinical incentives for physicians and hospitals to work more closely together. The logical result of this 30-year trend is physician-hospital mergers.3 There is no credible evidence that 340B hospitals are buying up private oncology practices any faster than non-340B providers. Private oncologists are resentful over changes in the medical marketplace that threaten their independence and earning power.

Scuttling 340B will not solve their problems and will only result in hurting needy patients as they seek affordable health care from safety-net providers.

REFERENCES 1. House Report, No. 102-384, Part II, pg. 12, 102nd Congress, second session.

2. Wang L, Tao T, Hamilton N. Turning Tides: Trends in Oncology Market Access. 2012. http://www.campbellalliance.com/articles/ Campbell%20Alliance%20-%20Turning%20Tides%20-%20 August%202012.pdf.

3. Witt M, Jacobs, L. Physician-hospital Integration in the Era of health reform. 2010. http://www.chcf.org/publications/2010/12/ physicianhospital. Accessed June 3, 2014.

AUTHORS’ DISCLOSURES OF POTENTIAL CONFLICTS OF INTEREST The authors indicated no potential conflicts of interest.

PRIVATE VS. HOSPITAL ONCOLOGY The Community Oncology Alliance, which represents private-practice oncologists, charges that treatment costs more in hospital settings and that 340B is somehow to blame. They conveniently overlook that fact that private oncologists treat very few poor patients. Much of a private oncologist’s profit is made marking up chemo drugs to fully insured customers. Underinsured and uninsured patients do not fit the business model and so they are referred to the nearest safety-net hospital. To meet HTTP://OPPP.US

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