Oncology as a medical specialty is, and always has been, rapidly evolving. The world in which we provide care for patients is also rapidly evolving, and not always in sync with our changes. Doctors will be needed to diagnose and treat patients, but where and how that happens may look dramatically different in only 10 years. We still have the ability to shape that future, but what we do today, and every day from now on, will help to define our role. More external forces than internal forces have already shaped our evolution to 2012 from the 1970s, as described below. Physician Offices Replaced Hospital Centers When oncology was evolving as a medical specialty, most cancer care was delivered in hospital inpatient units. Side effects of cancer treatments were almost as debilitating as the treatments themselves. While we were looking for medical solutions to fight cancer, hospital-based diagnosis-related groups (DRGs) came along in 1984, and a low price for the chemotherapy DRG encouraged hospitals to shift cancer care into the outpatient setting of the hospital, where it predominantly remained until the US Food and Drug Administration (FDA) approved drugs such as ondansetron (Zofran) starting in 1991. These drugs allowed us to manage side effects of toxic cancer drugs in a far more controlled manner, and fueled the growth of physician offices with infusion suites that functioned as acute care medical centers in the community setting. Specially trained physicians and nurses streamed away from hospitals into these community offices, and pretty soon, about 80% of all cancer care (and clinical research trials) was being provided in these community settings. Many hospitals completely closed their outpatient infusion centers, and often made collaborative arrangements for community medical oncology practices to create what looked like integrated cancer centers to the general patient. Physician Rates Lagged Behind Current Models During the same time period, federal policy changes regarding healthcare reimbursement for all services occurred, which, although not focused on oncology, had a far-reaching effect on cancer care. In the mid-to-late 1980s, the resource-based relative value system (RBRVS) was created. After a market review, the RBRVS established physician and practice work and expense codes for each medical specialty; these codes and valuations defined a sweeping change in professional services reimbursement by 1989 for all medical specialties. The problem for oncology was that only 2 years after the RBRVS was calculated and put into process, the community oncology office evolved. Consequently, the care scenario on which the RBRVS rates were based ceased to exist and was no longer representative of the new model that had emerged. Professional codes and reimbursement rates for oncology services never caught up to the reality of the practicing model. Buy and Bill Evolved for Efficiency and Stayed by Default to Cover Practice Costs Oncology physicians, like the hospitals from which they came, bought cancer drugs from distributors, treated patients, educated patients on symptoms and side effects, and then billed the insurer for the treatment actually delivered. Cancer drugs were not readily available from any other source, and specialized oncology distributors evolved to serve the growing cancer center market. In 1993, the federal government recognized that the physician codes and rates for oncology were inadequate and that the margin on the average wholesale price–based drug reimbursement model was covering the inadequacy, but the government decided not to change the situation because of the complexity of enacting such a change. In 2003, the World Shifted Under Oncologists, Patients Just as some wins were being logged against cancer death rates, and care management and treatment allowed some cancers to become more chronic than fatal, 3 key aspects of the 2003 Medicare Modernization and Improvement Act (MMA) shifted the oncology care model. First, reimbursements for oncology drugs paid to medical offices were reduced, and now based on an average sales price (ASP). Drug acquisition and inventory costs, even distributor mark-ups for sale to physicians, were not included in the ASP calculation. Despite a couple of years of temporary transitional adjustments, reimbursement rates and calculations for professional services related to oncology care also continued to decline on a net basis. Margins were tightening and practices started to analyze drug costs and reimbursements for both themselves and the patients. Second, Medicare Advantage plans were established that offered Part D drug benefits to Medicare patients. Initially, premiums, copays, and coinsurances were low and attractive to Medicare patients. Gradually, third and higher tiers were created for specialty drugs, and oncology drugs tended to be placed on the highest tiers. This led to increased coinsurances and copays for patients with cancer, and started a chain of patient access to care issues and site of care shifts based upon patient insurance coverage. A majority of Medicaid and Medicare patients without supplemental insurance were likely to shift to the limited hospital outpatient center sites of service, driven by cost burdens for physicians and patients in the community setting. Third, the Competitive Acquisition Program (CAP) generated attention on the prospect of a specialty pharmacy delivering drugs (in a practice known as “white bagging”) to an oncology practice and billing the payer directly, thus eliminating physician buy and bill. The CAP program was not successful or attractive to either specialty pharmacies or oncology physicians, and faded into limbo after its first years of existence. The program did, however, spark interest among specialty pharmacies about entering the oncology market for the first time. Further Change and Interest from External Parties In 2009, a new wave of federal healthcare reform created incentives for hospital-employed physician models and accountable care organizations (ACOs) to evolve. Not only specialty pharmacies, but also a number of pharmacy benefit managers and other companies aggressively built programs and proposals for private health insurers to use in managing oncology drugs, treatment, and costs. Words and concepts such as pay-for-performance, guidelines and pathways, preferred treatment regimens, evidence-based payments, episode-based payments, and oncology medical homes became hot topics and buzz words for 2010, 2011, and into 2012. Hospitals became interested again in expanding their oncology services and started buying practices that felt financially vulnerable as a result of all of the changes since 2003. How Will Cancer Care Evolve Now? Doctors will continue to treat patients. Drugs will be discovered and eventually approved by the FDA. All else appears to be up for grabs. There are at least 6 key variables that could shape what the cancer care delivery market will look like in 2022. Your decisions as an individual physician, administrator, and group may not change any of these by themselves, but should a sufficient volume of individual decisions all go in one direction or another, the tides could be shifted for those who do not take action.
Where are you going? Will you lead the way or be swept along by forces seemingly beyond your control? The year 2012 is a landmark year. There are more opportunities than ever to collaborate, engage, track, evaluate, and move the discussion of oncology management forward in a positive way for patients, physicians, hospital systems, health plans, and employers. Knowing what is riding the wave coming our way is the first step. Deciding to push forward into the current and start paddling is the second step. Enlarging your platform and adding tools to assist you navigate the turbulent waters is the next. Hopefully, when this is over, you’ll be one of the groups that has ridden the wave all the way into the next decade and will be proudly fighting cancer with your patients for another decade.
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