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5 Changes That Should be Made in Oncology

MHE PublicationMHE September 2020
Volume 30
Issue 9

COVID-19 is certainly important. But oncologists, people with cancer, and complex ecosystem of cancer care in the U.S. are grappling with other important issues such as reimbursement, distorted incentives, the implications of the massive amount of data that is available, and, of course, high costs and prices. Included are thoughts from five experts on these challenges and how they might be met.

COVID-19 is certainly important. But oncologists, people with cancer, and complex ecosystem of cancer care in the U.S. are grappling with other important issues as well — reimbursement, distorted incentives, the implications of the massive amount of data that is available, and, of course, high costs and prices. Below are thoughts from five experts on these challenges and how they might be met.

1. Reform the reimbursement model

Oncologists hired New Century Health in Brea, California, to help them navigate the CMS Oncology Care Model and other new ways of paying for cancer care. This gave the company’s chief medical officer, Andrew Hertler, M.D., FACP, a front-row seat in the struggle to bring value-based care to organized oncology, which he views as being a long time coming.

“Today’s fee-for-service oncology business model misaligns incentives by rewarding practices for keeping margins and service volumes high — even when it’s wasteful — rather than for optimizing patient outcomes,” he says. “While discussions of drug pricing dominate the cost- control conversation, we as practitioners have been abdicating responsibility and missing the opportunity to address cancer’s financial toxicity.” The term “financial toxicity” was coined to describe the health effects that high out-of-pocket costs can have on patients if they skip treatment, as well as the financial distress itself as they go through their life savings to cover their treatment costs.

In 2018, spending on cancer drugs in the U.S. reached $57 billion, double the total from 2013. The average cost of a new cancer drug was $150,000 in 2017. Under the buy-and-bill system used in Medicare Part B, CMS pays physicians the average sales price (ASP) of a drug, plus a markup, which had been traditionally been set at 6% but is now 4.3%. It is a common critique of buy-and-bill that it creates an incentive to prescribe more expensive drugs (or, at the very least, that it removes any incentive to prescribe less expensive ones) because the markup is a percentage of that higher cost. Moreover, some physicians and hospital outpatient departments get drugs below the ASP.

Hertler says that some of the expensive oncology drugs, old and new, are true game changers that have extended lives by many years. “But oncology is also rife with examples of therapies that dramatically increase the costs to our healthcare system while bringing relatively minor improvements,” he says.

“If you’re among the two additional individuals in every 100 who benefit, it’s a winning proposition,” Hertler continues. “But on a population level, however, the costs to our healthcare system and to society can be significant if we routinely make this decision for all cancers.”

That is why, in his opinion, continuing this reimbursement model of rewarding the selection of more expensive, less efficacious drugs is not sustainable or acceptable, and if unchecked will ultimately limit patient access to care.

New Century Health and Hertler see clinical pathways as a way to deal with drug costs. “These care pathways guide oncologists in their selection of treatment regimens based on the latest clinical data and help prioritize the most effective treatments with the fewest side effects and lowest cost,” says Hertler, who also talks about the need to engage oncologists and keep them involved. “Taken together, this approach is key for allowing oncology practices to take costs into their own hands and drive savings and improvements across the patient journey,” he says.

2. Curb the cost of specialty drugs

Jeff Patton, M.D., CEO of OneOncology, believes the biggest issue facing oncology is the high cost of specialty drugs.

“It’s unsustainable for patients, physicians, employers and even health plans,” says Patton, who was named CEO of the large specialty network headquartered in Nashville, Tennessee, in May. “Even when community oncologists don’t bill for their work, the cost of therapies causes too much financial toxicity for patients and difficult decisions about coverage and value for employers and plans.” Also, says Patton, an analysis by OneOncology showed that the high cost of specialty drugs “poses challenges” for practices in value-based care arrangements, such as the CMS’ Oncology Care Model.

Patton says drugmakers could fix the problem of high prices with more rational pricing — or Congress should give CMS the power to negotiate prices.

3. Help overburdened oncologists

Dane Dickson, M.D., a practicing oncologist and CEO and founder of Taproot Health in Salt Lake City says oncologists are being asked to do so much more with so much less.

“Decreasing reimbursement, increasing regulations, endless payer requirements and difficulties accessing needed drugs — not to mention the challenges of COVID-19 — are critical problems on their own,” he says. “As oncologists, our priority has always been to patients. How can we provide excellent care for today’s patients, plus participate in valuable cancer research initiatives to help the patients of tomorrow, when reimbursement is being slashed and administrative burdens are outrageous?”

Dickson believes the real-world data that clinics generate can become a powerful method of advancing cancer research and provide financial resources to clinics.

“But (these) data (have) to be organized and shared to have the greatest value,” he says. “Data (are) a commodity worth billions of dollars, yet many oncology clinics ignore this potential revenue stream and may allow it to be siphoned off by others. Oncology clinics need transparent solutions to empower them to collect and share quality data.”

4. Improve patient consent

Speaking of data, Dickson pointed to its ownership and patient consent as another trouble spot in oncology. Should patients be asked before their data are taken and sold for private gain? Should clinics have transparent control over the data they are generating?

“Currently, most of the real-world data being provided to third parties is being done without patient consent,” he says. “Some patients may have agreed to a vague disclaimer in any of the endless forms they have to sign before receiving care, but this is not informed consent by any stretch.”

This issue is further complicated by genetic-testing data, which could easily identify patients, especially those with rare cancers.

“The right thing to do is ask patients and clinics if we can collect, organize and transparently share data, so all parties know how their information is being used,” Dickson says.

5. Simplify clinical trials

According to Claire F. Verschraegen, M.D., director of the Division of Medical Oncology at The Ohio State University College of Medicine, even although oncology is seeing the approval of many new drugs, there’s a need to simplify clinical trials. There are a lot of new approvals for new drugs in oncology, and the complexity of the approval process is still challenging. “I feel like we’ve created a monster of administration when we run clinical trials,” she says.

For example, a randomized phase 3 trial may be conducted worldwide at hundreds of sites. Verschraegen believes fewer sites are needed. She also says researchers could pare down the amount of data they are collecting. “If the goal of the study is to measure these 10 items, why are we recording all the things that happen that may have no bearing on the study? Why don’t we just focus on the essentials?” she asks. “I think we should come up with an international reorganization of how we run clinical trials to make them more efficient.”

Keith Loria, a regular contributor to Managed Healthcare Executive®, lives in the Washington, D.C., area.

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