5 reasons to change the oncology model

September 10, 2014

Patient care as well as the financial health of oncologists should be strengthened

1/

A wave of scientific studies on cancer in the last few years is driving innovation and confusion. It is also making it difficult for oncologists to stay current, WellPoint contends. Case in point: 180 medical journals are publishing new studies on cancer monthly and quarterly.

2/

There are major cost variations for “equally effective treatments.” Adjuvant therapy for HER2-negative breast cancer, for example, can range from $13,000 to $32,000 with similar outcomes. Consider non-small cell lung cancer with six platinum-based regimens. The cost ranges from $8,000 to more than $60,000. The most expensive therapy is reported to extend life a few weeks longer than the least expensive therapy, but there is no difference in outcomes between the most expensive regimens and those costing $25,000. 

3/

Oncology patients are far more complex to treat and care for and, therefore, practices have many expenses to support the average staff of seven full-time employees per oncologist. 

4/

Typically oncologists buy infused chemotherapy drugs and administer them in their offices. Oncologists in medical practices (outside of hospitals) earn nearly 69% of their revenue from reimbursement on cancer treatments. The practice is commonly referred to as “buy and bill.”

5/

While the business model encourages use of more expensive chemotherapies even if less expensive therapies provide similar outcomes, cuts to drug reimbursement and Medicare fees are placing greater financial pressure on community oncologists which is increasing merger and other practice agreements with hospitals.

Source: WellPoint