Making the Transition from Volume to Value

Meg Barbor, MPH

April 2017, Vol 7, No 4 - Oncology Practice Conference 2017


Orlando, FL—Value-based care—the best care delivered at the lowest cost—is here to stay, said Karen K. Fields, MD, Medical Director, Clinical Pathways and Value-Based Cancer Care, Moffitt Cancer Center, Tampa, FL, at ASCO’s first Oncology Practice Conference in March 2017. But certain steps must be taken to ensure a smooth transition from fee-for-service to value-based care for institutions and for physicians, Dr Fields said.

New drug therapies, and changing treatment patterns, are associated with increasing costs in oncology, and these escalating costs have been driving healthcare to value-based payment models. Consumers are demanding quality, convenience, and rapid access to care, further driving the transition to more consumer-directed healthcare plans.

“All of these things come together to tell us [that] we need to work on being accountable,” said Dr Fields.

Physician Adoption of Value-Based Payment Models

A 2016 Deloitte survey of 600 US physicians who were asked about a range of topics, including value-based payment models, showed that the majority of physicians agree with the principles of value-based care—improved quality and resource utilization—but little focus is placed on physician compensation in value-based models.

In general, financial incentives have not changed since the 2014 Deloitte survey of US physicians. For example, the majority (86%) of physicians in the 2016 survey reported that their compensation came from fee-for-service or salary models, with value-based payment models accounting for only 30%. Overall, 51% of physicians reported performance bonuses ≤10% of their compensation, and 33% were ineligible for performance bonuses.

“These physicians are not getting a lot of incentive to practice in an accountable fashion,” said Dr Fields.

When asked whether they had the necessary tools to support value-based care, 75% of physicians reported having clinical protocols (guidelines or pathways), but only 36% have access to comprehensive protocols, and only 20% receive data on the cost of care.

Recommendations based on this survey focus on linking compensation to performance by putting at least 20% of salaries and compensation at risk to meaningfully incentivize accountable performance.

It is necessary to equip physicians with the right tools to meet performance goals by providing detailed performance data and decision support tools, said Dr Fields. Investment in technology capabilities, accompanied by reliable benchmarks and incorporated into the workflow, is also vital, she added.

The Emphasis on Accountability

“There are a lot of different ways hospitals and providers can work collaboratively around accountability,” she said, including aligning providers and institutions through comanagement service agreements between health systems and physician groups, or through physician–hospital organizations that can create the milieu necessary to incentivize performance; and aligning incentives by using relevant end points that emphasize clinical outcomes, quality, and appropriate utilization.

In the past 4 years, the Moffitt Cancer Center has made the transition from a plan that is largely based on productivity and individual incentives to a team-based incentive plan.

“We were entering into accountable care contracts and we really needed to modify and support behaviors that focused on accountability,” Dr Fields said. The Moffitt Cancer Center’s incentive plan is divided into 4 equal segments, with metrics in each area. These segments are:

  • Productivity
  • Quality
  • Operational efficiency
  • Academic mission.

“We learned that change in physician compensation is difficult,” said Dr Fields. “Quality is hard to measure and report, particularly in the context of medical practice, and the laws pertaining to it are complex.” Changing physician incentives and achieving goals take time, but communication and transparency are keys to the Moffitt Cancer Center’s success.

“The most important thing is modeling it appropriately, so you’re actually able to pay the incentives,” Dr Fields said. As a result of the change in its incentive plan model, the Moffitt Cancer Center has seen the normalization of incentives across the practice, increased incentive payments, better alignment of institutional goals and objectives, and increased physician satisfaction.

Institutions should develop their own clinical pathways, she suggests. Clinical pathways provide consistent, quality care with program-specific consensus; encourage collaboration and discussion surrounding best practices; and help personalize cancer care by patient factors and evidence, rather than by physician preference.

“The bottom line is that adopting clinical pathways in your program is critical to instilling accountability. We no longer follow pathways because ‘that’ physician liked ‘that’ regimen, and that was the best change we made,” said Dr Fields.

Insurance companies have their own quality measures, so “the secret is to get armed with quality measures you can develop in your own practice. You don’t want to keep creating new ones. This adds extra time and expense, and detracts from your big goal, which is improving care for your patients,” Dr Fields added.

Understanding the Total Costs of Care

Understand your costs, monitor for outliers, and be able to integrate clinical data with financial data, advises Dr Fields.

“This was a harder job than we even imagined. We had a lot of data, but none of it was linked so that we could logically understand how much it really costs for us to provide care for a specific disease, stage of disease, or therapeutic intervention,” she observed.

She also suggests practices define cancer groups, break costs into common groups for easy comparison, recognize new and unplanned costs, and intervene and communicate the cost of care to physicians.

Achieving savings requires a comprehensive approach. For example, Dr Fields and her colleagues at the Moffitt Cancer Center learned that focusing on the nonchemotherapy costs, such as side-effect management, and decreasing the utilization of expensive resources like emergency department and hospital days, could have a greater impact on savings than solely addressing chemotherapy costs. Supportive and palliative care in appropriate patients is also essential for high-quality care and resource utilization, she added.

Drug costs make up the largest proportion of “the spend,” and new and expensive therapies make predicting financial implications difficult, said Dr Fields. Therefore, rapid changes in drug therapy require a prospective plan to address changes in the baseline costs or contractual payments.

There will be new costs to the system (eg, navigators, care coordinators, auditors, consultants); therefore, know which contractual arrangement is best for your organization, and foster a collaborative relationship with payers, advised Dr Fields. “The payers want to work with you on these things. They have data you don’t have and vice versa,” she added.

“We need to learn to behave differently. Our whole system has to change to support the change from volume to value,” concluded Dr Fields.