Transcript The Medical Oncologist

COMMUNITY ONCOLOGY ALLIANCE
2011 POHMS FALL MEETING
Is There a Home for Oncology in ACOs?
Ted Okon
Executive Director
9/16/11
Presentation
 Brief update on important events from DC
• Proposal to debt “super committee” to cut Medicare drug
reimbursement to ASP + 3%
• MedPAC proposal to cut specialists’ fess by 18% as SGR “fix”
 ACOs, as currently constructed by CMS, leave little room
for oncology
 Medical home is a better model for oncology
• Basically just a next step of the current oncology care model
• Allows for different payment options
 What you can do
• Please be engaged NOW!
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The Changing Landscape
of Cancer Care Delivery
 1042 Clinics
Impacted
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199 Clinics Closed
369 Practices
Struggling
Financially
48 Practices Sending
ALL Patients
Elsewhere for
Treatment
315 Practices
Acquired by a
Hospital
111 Practices
Merged/Acquired
Source: COA Practice Impact Tracking Database as of 3/31/11
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Landscape Change Over 6 Months
Source: COA Practice Impact Tracking Database as of 3/31/11
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Why is the Landscape Changing?
 Medicare changed oncology reimbursement in 2004/2005 and has made
additional payment cuts since that time
 Medicare payment changes have influenced private payers over time
• More payers have moved to ASP-based drug reimbursement
 Congress’ inability to fix the SGR-based Medicare payment system has
created additional pressures
• Business planning is next to impossible for oncology practices
 Health care reform is proving to be a motivating force for market
consolidation
• Tremendous uncertainty for providers; has them running scared
• Hospitals consolidating their markets by integrating private practices (such as
oncology)
• Payers are even looking to consolidate their markets by acquiring health care deliver
systems
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Highmark and West Penn in PA
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Drug Shortages (All Drugs)
Shortages Specifically of
AntiNeoplastic Agents
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Source: University of Utah Drug Information Service
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What is Causing Drug Shortages?
 Precipitating event was a fundamental change in the
Medicare reimbursement system from AWP to ASP
• Effectively created price controls on low-cost generics
 Rebate pressures from growth in Medicaid and 340B
programs have further decreased generic profitability
 Do manufacturers focus on low profit generics or more
profitable product lines?
• Tight capital may further influence this decision
 Number of generic manufacturers have decreased per drug
• Manufacturing, quality, supply, and regulatory problems have
more pronounced impact when fewer manufacturers
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Challenges Facing Oncology
 Additional reimbursement cuts proposed by Medicare in the 2012
Physician Fee Schedule
• Pay Attention to the GPCI
 29.5% SGR cut if Congress does not act before 1/1/2012
 Debt “solution” created a “super committee” that will consider
provider cuts to Medicare
• Must find $1.2–1.5 trillion in spending cuts by end of year
 Health care reform introduces tremendous uncertainty
• Will the mandate that all have insurance or the entire law be declared
unconstitutional?
• Will ACOs work?
• Etc, etc, etc…
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2012 MD Fee Schedule Impact
 GPCI = Geographic Practice Cost Indices
• Philadelphia -1%
• Rest of PA -2%
Source: COA modeling based on data provided by community oncology clinics
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SGR Situation
 29.5% cut effective 1/1/12 if Congress does not act
 In limbo due to the debt deliberations and “super
committee”
• Will the SC take up the SGR?
 5 largest physician associations calling for 4-5 year
transition period before SGR eliminated
• Replaced with new payment
mechanism
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Shared savings in ACO model?
Medical home?
Bundled payments?
 Yesterday, MedPAC recommended
“solution” to SGR mess
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Debt Solution “Super Committee”
 Super committee made up of 12 members of Congress
• House — 3 Republicans, 3 Democrats
• Senate — 3 Republicans, 3 Democrats
 Tasked with finding $1.2-1.5 trillion in spending cuts before
Thanksgiving congressional recess
 List of $500 billion in Medicare cuts circulating
• Contains cut in Medicare drug reimbursement from ASP + 6% to ASP +
3%
 If committee cannot agree on cuts, or agrees and Congress cannot
pass legislation before 12/23, automatic spending cuts go into effect
• Includes 2% Medicare cut on everything
• Will impact oncology services and drugs
 President just added to the burden with the American Jobs Act
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ASP + 3%
 House Democrat Ways & Means staff has included cut
to ASP + 3% on the list of potential spending
reductions
 Discussion points by staff:
• Large oncology practices will not be impacted by cut to
ASP + 3%
• Small practices may be forced to send patients elsewhere
for treatment but patients will get treated
• There is no justification for ASP + 6%
–
Practices are simply use to getting it
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Policy & Private Payer Health Care
Reform Changes to Medicine
 Policy makers bent on driving Medicare costs down
• Ensure quality in the process
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At least give quality lip service
• Pay for “value”
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Fee-for-service payment system has a big target on it
• Force care coordination
 Examples already being implemented
• Hospitals will be paid differently based on value
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MDs are next
• Bundled payments for hospitals to distribute to MDs
• Accountable Care Organizations to coordinate care
 Private payers are following suit
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What Oncology Needs to Do NOW
 Define exactly what is quality and value in cancer care and
measure it
• Lead; don’t be led on this
 Put value and evidence-based medicine in the context of a
model that works for cancer care
• Model needs to work for clinical & business operations
 Explore new, viable payment models
• Lead; don’t be led on this
• Examples — shared savings, bundled, episode of care
 Advocate for the model!!!
• Develop it, embrace it, believe in it, and “sell” it
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“Won’t You Be My Neighbor”
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Accountable Care Organizations (ACOs)
 Think of ACOs as the “medical neighborhood”
• Different provider “neighbors” working
together to spruce up the neighborhood
• ACO model not defined by “process”
but by “payment”
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The defining payment model is
“shared savings”
If you produce $$$ savings you get to keep a portion
 Providing you meet quality targets
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Providers on their own to figure out the process of making this
happen
 Savings
 Quality
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CMS/Medicare Model for ACOs
 Proposed rule released by HHS/CMS
• Final rule released any day now???
 Big picture
• Primary care driven
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Specialists cannot take the lead in
forming an ACO but can participate in it
Clearly is driven by primary care and large integrated systems
• Some easing of anti-trust provisions designed to hinder
coordination of care in the first place
• Share in the savings if quality metrics are met
• All ACOs and provider participants go at risk at least after 2
years
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How CMS ACO Payment Works
 ACO participants still get paid under fee-for-service
 Two shared savings options
• No risk for first 2 years, at risk for third year
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Share in at least 50% of the savings
 Must hit a minimum threshold of savings
 Must satisfy “quality” criteria
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At risk in year 3 for up to 7.5% of what care should have
cost if no ACO
• At risk for 3 years
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Share in at least 60% of the savings
 Same minimum threshold and quality criteria
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At risk for all 3 years for up to 10%
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ACO Questions for Oncology
 How will cancer treatment fit into an ACO framework?
• Where are the quality measures relating to cancer care?
• If no specific quality measures to meet, how will patients
be ensured of having access to the best — not least
costly — therapy?
• Will ACOs want independent practice cancer care?
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High cost treatment is an outlier
 How do new $93,000 and $120,000 drugs not break
the bank of an ACO?
• How will new therapy advances be treated?
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COA’s Comment Letter to CMS on ACOs
 Totally agree with what ACOs are trying to accomplish
• Increased care coordination
• Enhanced quality
• Decreased costs
 Unfortunately, ACOs as proposed by CMS will not work
• Too much risk, too little reward
• Cancer care not mentioned in proposals
• Not one quality measure deals with cancer care
 Solution we propose is the oncology medical home model
• Proven concept in a medical oncology practice
• Experience has produced consistent quality and value
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The Medical Home Model
 Think of the Medical Home as your
house
• Your practice becomes the “medical
home” for the cancer patient
–
You don’t treat all diseases but you
coordinate the care among other treating physicians
• It’s all about the processes that will improve quality and reduce
costs
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Evidence-based medicine
Patient focus
Delivery of value
• Defined by process, not payment
• Different payment models can be utilized
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Primary Care Medical Home
 40 year old concept
 Wide-spread acceptance of the Primary Care Medical
Home concept
• 60 different pilots nationally
• Varied stakeholder collaboration
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Primary care practices
Medical societies
Consumers
Insurance companies
Academic institutions
Medicaid
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Medical Home in Oncology Experience
 Dr. John Sprandio has made his practice a patient-centered
oncology medical home
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Re-engineered the process of care
Imbedded IT functionality
Increased physician efficiency through standards
Maximized “time, touch and teaching” opportunities with
patients and families
Promoted a culture of physician accountability
Placed a constant focus on patient related disease
management and coordination of care
Measured increases in quality & decrease in costs
Working with payers to build reimbursement into the model
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COA Medical Home Efforts
 Developing a structured, 3-level oncology-specific medical home
implementation and recognition program
• What oncology practices need to do
• How to move along a 3-step process to the medical home
 Developing a practical, viable payment approach relating to Medicare and
private pay
• Submitted a demonstration project to CMS CMI
• Will be working with Congress on a legislative demonstration project
• Working with private payers and NAMCP on the oncology medical home model
 Looking for input, help, and involvement from the oncology community!
• Help us develop and implement the model
• Please get involved!!!
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Final Words — Action Needed Now!
 Cancer organizations united to stop cancer care cuts
• Letter to the debt “super committee”
• Congress outreach/advocacy
• Advertising/media/press
 Please help — Need grassroots activity!
• Go to Action Needed on the COA website
• Create awareness about the crisis in cancer care — payment cuts and drug
shortages
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Members of Congress
Media
 Please help by writing an OpEd
• “Like” Facebook page on the cuts
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www.facebook.com/StopCancerCareCuts
 Letters to state congressional delegation about the impact of the
payment cuts and drug shortages
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Inside the Beltway Advocacy
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DC Hill Day on September 22nd
 Come to DC on 9/22
 Help enlist members of
Congress to Stop Cancer
Care Cuts
 Represent oncology on
the Hill during a critical
time
 Make your media aware
of your visit
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Thank You!
Ted Okon
[email protected]
Twitter @TedOkonCOA
www.communityoncology.org (COA & CAN)
www.COAadvocacy.org (CPAN)
www.facebook.com/CommunityOncologyAlliance
www.facebook.com/StopCancerCareCuts
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