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Topics: Oncology, Service Lines, Patient-Focused Care, Methodologies, Performance Improvement, Palliative Care, Evidenced-Based Practice, Staffing, Labor Expense, Workforce
Oncology spending is a big factor in rising health care costs, so decreasing that spending without decreasing care quality is a big priority for cancer care providers. After reading this study, members will be able to provide cheaper care delivery by:
- Following an efficient care delivery model
- Enhancing care standardization
- Adapting to health IT
- Expanding access to palliative care
Executive Summary
Health Care Costs Growing Unchecked
Across 2009, the United States has been embroiled in a debate over the future of health care. The discussion in Congress surrounding health reform, combined with the worst economic downturn in 80 years, has served to focus the public’s attention on rising health care costs. Left unchecked, cost growth will inevitably lead to Medicare’s bankruptcy and significantly curtail access to care.
Spending on oncology is a major contributor to the increase in overall health care costs. Between 2004 and 2007, spending on cancer care increased 25 percent from $72 billion to $89 billion, and this rate is expected to accelerate in the future as more patients receive more care over longer periods of time. While not a new problem, the dynamics of the situation appear to be changing, such that providers will be forced to take action sooner rather than later.
Payers Turning Their Attention to Oncology Costs
Traditionally payers have been reluctant to appear to scrutinize the costs of cancer care too closely, however that is starting to change. Some commercial insurers have actually identifi ed oncology as one of the most promising areas for cost savings. According to a recent survey, managed care executives believe that spending on cancer can be reduced by one-fifth without impacting care quality. Thus they are implementing strategies, including increased preauthorization requirements, care management, and benefits management, designed to control utilization and encourage providers to prescribe lower cost treatments. Others are working to develop new approaches to cost control. For example, starting in 2008 United Healthcare began denying claims for chemotherapy treatments that did not adhere to the NCCN’s Drugs and Biologics Compendium. As a result, physician compliance to NCCN guidelines rose from 85 percent to 99.5 percent. Thanks in part to the success of that initiative, United is now piloting a new reimbursement model in medical oncology in which physicians are reimbursed based on episodes of care. The goal is to decouple physician income from treatment choices, and so align incentives to promote care quality rather than quantity. If successful, such payment models would force providers to bring new cost discipline to care delivery.
Cancer Providers Facing Pressures from All Sides
Many cancer programs have already been forced to cut operating and capital budgets due to the recession; unfortunately, these initial cuts may not be sufficient. Pressures to reduce costs will only intensify in the future as scrutiny of oncology costs increases. This is disheartening as it comes as a time when growth in demand for cancer care is beginning to accelerate. In order to meet the needs of the baby boom generation as well as increasing numbers of cancer survivors, cancer programs will have to add infrastructure and services. At the same time, providers are facing a shortage of oncologists as well as what effectively amounts to a government mandate to speed up implementation of clinical information technologies.
New Reality for Cancer Programs
As a result of these converging trends, cancer programs will be forced to revisit their current model of care delivery. The path forward will require programs to implement strategies across a number of vectors including advancing care standardization, expanding access to palliative care, deploying advanced practice providers, and adopting clinical information technologies. Admittedly, these ideas are not new; in fact the cancer care community has been discussing them for years. However the environment in which cancer programs are operating is changing, and the new reality is that providers will no longer be able to defer these strategies. Leading institutions have already begun to make progress in these areas; the purpose of this publication is to aggregate lessons and ideas from best practice institutions that will assist other cancer programs as they transition to a new model of care delivery.
Essay - The Need to Transform Care Delivery
