Site of Care Matters:
The Value of Community Oncology
The Payer Value Proposition
Prepared for ION Solutions
September 2012
Outline
Current State of Oncology Management
Community vs Hospital-based Oncology Care
Changing Oncology Landscape
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The Value of Community Oncology
Patients managed in an office-based setting are less costly than those
managed in hospital outpatient settings
Care provided in a community office-based setting is more accessible and
less costly for patients
Patients in community settings utilize more generics and less brand therapies,
which results in savings for payers
Community practices are more willing to participate in pay-for-quality pathway
programs, which will translate into improved outcomes and savings for payers
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Current State of Oncology
Management
Consolidation in the cancer care landscape continues as
larger hospital groups acquire, purchase, or merge with
private, community-based practices
Changing Business Structure of 1,254 Oncology Clinics/Practices From 2008–20121
241 Clinics Closed
442 Practices Struggling Financially
47 Practices Sending Patients Elsewhere
392 Hospital Agreement/Purchase
132 Merged/Acquired by Another Entity
1. Practice Impact Report. Community Oncology Alliance. April 4, 2012. http://www.communityoncology.org/pdfs/community-oncology-practice-impact-report.pdf Accessed August 23, 2012
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In 2011, nearly 1 in 4 practices (24%) indicated that
they are currently changing their business structure or
may only remain viable for another year or so
How long to you expect this business structure
will remain unchanged and viable?
Current (N=106 practices)1
Future (N=106 practices)
3% 1%
24%
11%
10%
13%
54%
22%
86%
Physician-owned practice
For the foreseeable future
Hospital-owned practice
For at least 5 years
Other
For another year or so only
Academic practice
We are changing now
1. Barr TR, Towle EL. National Oncology Practice Benchmark, 2011 Report on 2010 Data. J Onc Pract. 2011;7(6S):67S-82S.
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Payers’ Understanding of the Issue
• Payers understand that oncology is unique and must be approached differently
than other specialties
• Payers often consider 2 opposing goals when managing oncology1
– Find ways to more aggressively control oncology spending
– Craft management policies that are politically and clinically defensible
• Payers focus their management attention on the most prevalent and high-cost
cancer types to generate the largest return for their efforts in developing and
implementing management programs
– These cancer types are:
Breast
Lung
Colon
1. McConnell K, Wu J, Dautel N. Payers Must Create Defensible Oncology Management Strategies. Oncology Business Review. 2010
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Payers prioritize costs before other relevant oncology
issues, like site of care
• Although the provider landscape in oncology is rapidly changing, payers prioritize other
aspects of oncology care before the movement of community-based care to hospitalaffiliated practices
• Priorities remain cost drivers such as the cost of hospitalizations or the cost of highpriced products
70%
Payer Priorities in
Payer Priorities in Oncology1
Oncology1
Movement of
community-based
care to hospitalaffiliated practices
60%
50%
40%
Cost of
Hospitalizations
30%
20%
High-priced new
products
10%
0%
1 - Not at all a priority
4 - Neutral
7 - Extremely high priority
1. High-priced new products
2. Cost of hospitalizations
3. Ability to compare and analyze
pharmacy and medical benefit
4. Need to increase use of generics
5. Appropriate use of biomarkers
6. Pathway implementation
7. Appropriate use of hospice
8. Compliance and persistency with
oncology drugs
9. Cost of emergency room visits
10. Movement of community-based
care to hospital-affiliated
practices
11. Role of 340B
1. Xcenda. Managed Care Network. PayerPulse June 2012.
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There also appears to be a disconnect between payer and
provider preferences for acquiring infused therapies; payers
prefer SPP, while providers demonstrate a preference for buyand-bill
Payers’ Preferred Infused
Therapy Distribution Channel1
2%
3%
Providers’ Primary Infused
Therapy Acquisition Channel1
42%
53%
• >70% of infused therapies for oncology
are distributed via buy-and-bill1
• Average sales price (ASP) used as the
primary method of reimbursement by
payers
Buy-and-bill
Specialty vendor
Patient acquisition
Other
1. Snyder M, Goldberg L, Ryan T. Payer Management of Oncology Gets Serious. Pharmacy Times. http://www.pharmacytimes.com/publications/specialty-pt/2011/May2011/PayerManagement-of-Oncology-Gets-Serious. Accessed August 17, 2012.
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The Challenge of Establishing the Site of
Oncology Care Payer Value Proposition
•
There is somewhat of a disconnect between payers and oncology providers
–
Payers have other priorities in oncology that supersede site of care, despite the recent market
changes
•
–
Preferences for product acquisition vary and create an additional point of discussion and
negotiation between the 2 groups
•
•
Payers are seeking additional payment models that make oncology practices’ income independent of
drug selection and reward physicians for improving outcomes and reducing costs
As heard in a recent payer focus group, smaller regional payers may have different
views, needs, and opinions than larger national payers1
–
•
Payers lack awareness of the value that community oncology practices bring to the market
National payers may have more lucrative contracts with hospitals, particularly larger hospital
systems, than with smaller community practices, and therefore, may see comparable costs in
patients treated in the hospital outpatient department (HOPD) setting
•
The opposite being true for smaller payers
•
Mid-size plans are more undecided and potentially able to be persuaded either way
Payers are also looking for a demonstration of quality as part of the value equation1
–
ie: Value = Quality / Cost
1. Xcenda, data on file. Oncology Site of Care Virtual Payer Council. September 2012.
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Community vs Hospital-based
Oncology Care
While HOPDs often profess to care for sicker patients to justify their
higher costs, recent claims analyses show similarities in the
demographics of office-managed vs HOPD-managed breast, lung,
and colorectal cancer patients1
Patients by Gender in
Select Tumor Types1
Patient Severity in
Select Tumor Types1
10
80
60
Office
40
HOPD
20
Score/Number
% of patients
100
5
Office
HOPD
0
0
Male
Female
Gender
• Slightly more females than males are treated in
the HOPD compared to community practices
Charlson
comorbidity
index
# of unique # of unique
diagnoses prescriptions
• Patient illness severity is roughly the same in
the community practice setting as the HOPD
setting across these 3 tumor types
• The mean age of patients in the community
practice setting is slightly higher than in the
HOPD setting (58.7 years vs 56.9 years,
respectively)
1. Xcenda, data on file. Site of Care Claims Analysis Report. September 2012.
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The Value of Community Oncology
•
Patients managed
in an office-based
setting are less
costly than those
managed in
hospital outpatient
settings
Three separate analyses of managed care claims in
commercial and Medicare populations demonstrate that
patients managed in a community office setting cost
less than patients managed in a hospital-based
outpatient setting1-3
–
The difference in cost varies for individual tumor types;
however, the data suggest that this applies to breast, lung,
and colorectal cancer3
•
Evidence suggests that patients managed in a
community office setting have lower hospitalization
rates than patients managed in a hospital-based
outpatient setting
•
The majority of common breast, colorectal, and
lung cancer chemotherapy-specific costs are lower
for patients managed in a community setting
1. Avalere Health Analysis Report of National Association of Managed Care Physicians member data. Total cost of cancer care by site of service: physician office vs outpatient hospital.
March 2012.
2. Fitch K, Pyenson B. Site of service cost differences for Medicare patients receiving chemotherapy. Milliman Client Report. 2011.
3. Xcenda, data on file. Site of Care Claims Analysis. September 2012.
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Analysis of 4 large commercial health plans reveals that patients who
are managed in an office setting are 24% less costly than hospitalmanaged patients for common cancer types1
Office-managed
episodes
Types of
cancer
Prostate
HOPD-managed
episodes
# of
episodes
Average
episode
cost
# of
episodes
Average
episode
cost
%
difference
in average
episode
cost
3,503
$21,299
394
$25,504
19.7%
Average Cost of
Chemotherapy for Most
Common Cancer Types
24% Difference
$40,000
$35,000
Genitourinary
system
3,152
Breast
2,252
$30,072
860
$33,391
11.0%
$25,000
Lung
3,036
$32,913
1,239
$32,382
-1.6%
$20,000
Colon
973
$45,997
233
$46,220
0.5%
$15,000
Digestive
system
688
$30,018
266
$30,044
0.1%
$10,000
Leukemia
581
$39,008
350
$43,508
11.5%
Hodgkin’s/
lymphoma
2,131
$39,080
902
$42,537
8.8%
$8,960
655
$19,592
118.7%
$35,000
$30,000
$28,200
$5,000
$0
Office-managed
chemotherapy
HOPD-managed
chemotherapy
1. Avalere Health Analysis Report of National Association of Managed Care Physicians member data. Total cost of cancer care by site of service: physician office vs outpatient hospital.
March 2012.
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There was a 114% difference in the average cost of
episodes for office-managed patients ($26,800) vs
HOPD-managed patients ($57,400) over 9 months1
Office-managed episodes
HOPD-managed episodes
Length of
episode in
months
# of episodes
Average
episode cost
# of episodes
Average
episode cost
% difference
in average
episode costs
1
4,601
$7,350
1,784
$9,903
34.7%
3
2,502
$19,238
1,091
$24,592
27.8%
5
1,601
$26,979
481
$40,677
50.8%
7
1,091
$26,395
268
$40,879
54.9%
9
734
$26,794
127
$57,384
114.2%
11
302
$47,468
69
$63,366
33.5%
1. Avalere Health Analysis Report of National Association of Managed Care Physicians member data. Total cost of cancer care by site of service: physician office vs outpatient hospital.
March 2012.
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In a Medicare population, office-managed patients cost
$6,500 less per year than hospital-managed patients
Annual cost per patient
$6,500 Difference
$56,000
$54,000
$54,000
$52,000
$50,000
$48,000
$47,500
$46,000
$44,000
Office-managed chemotherapy
HOPD-managed chemotherapy
1. Fitch K, Pyenson B. Site of service cost differences for Medicare patients receiving chemotherapy. Milliman Client Report. 2011.
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Hospital-managed patients with breast, colorectal,
and lung cancer were more costly than communitymanaged patients1
Mean Chemotherapy Costs – All Regimens
$25,000
Community
Hospital
$19,136
$20,000
$15,000
$13,577
$12,318
$11,599
$10,272
$10,000
$8,344
$5,000
$0
Breast
Colorectal
Lung
1. Xcenda, data on file. Site of Care Claims Analysis. September 2012.
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Breast cancer patients managed in a hospital-based
setting are more costly in all treatment categories1
Breast Cancer Treatment Costs
Community
Hospital
$25,000
$20,236
$20,000
$18,493
$15,545
$15,000
$14,474
$13,149
$12,860
$10,593
$10,000
$9,403
$7,668
$5,000
$4,831
$3,899
$3,052
$2,504
$2,348
$0
Non-targeted
chemotherapy
combinations
Bone
metastasis
agent
Targeted
chemotherapy
Single-agent
hormone
Single-agent
chemotherapy
Single-agent Chemotherapy
targeted
+ bone
metastasis
agent
1. Xcenda, data on file. Site of Care Claims Analysis. September 2012.
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Colorectal cancer patients managed in a hospitalbased setting are more costly in all treatment categories
except bone metastasis agents1
Colorectal Cancer Treatment Costs
Community
Hospital
$80,000
$73,920
$70,000
$60,000
$50,000
$40,000
$32,010
$30,000
$20,000
$16,214
$15,902
$10,345
$15,033
$11,644
$10,000
$14,517
$5,471$5,552
$1,870
$330
$0
Non-targeted
chemotherapy
combinations
Bone metastasis
agent
Targeted
chemotherapy
Single-agent
chemotherapy
Single-agent
targeted
Chemotherapy +
bone metastasis
agent
1. Xcenda, data on file. Site of Care Claims Analysis. September 2012.
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Lung cancer patients managed in a hospital-based
setting are more costly in most treatment categories1
Lung Cancer Treatment Costs
Community
Hospital
$35,000
$30,665
$30,000
$25,000
$20,000
$14,891
$15,000
$10,000
$15,050
$13,632
$14,693
$13,391
$9,580
$13,505
$12,644
$9,565
$6,051
$4,131
$5,000
$0
Non-targeted
chemotherapy
combinations
Bone metastasis
agent
Targeted
chemotherapy
Single-agent
chemotherapy
Targeted +
chemo + bone
metastasis
Chemotherapy +
bone metastasis
agent
1. Xcenda, data on file. Site of Care Claims Analysis. September 2012.
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In the same analysis, office-managed patients also had
fewer hospitalizations during chemotherapy
• An analysis of 3 years of commercial health plan data reveals that oncology patients
treated in an HOPD have higher hospitalization rates
Office-managed
HOPD-managed
11 out of every 100 patients had at least 1
hospitalization during the chemotherapy episode
14 out of every 100 patients had at least 1
hospitalization during the chemotherapy episode
1. Avalere Health Analysis Report of National Association of Managed Care Physicians member data. Total cost of cancer care by site of service: physician office vs outpatient hospital.
March 2012.
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The majority of common breast, colorectal, and
lung cancer chemotherapy-specific costs are lower
for patients managed in a community setting1
Breast Cancer Mean Chemotherapy-specific Costs
$20,000
$10,000
$13,754
$2,267
$1,291
$4,460
$6,615
$909
$1,033
$5,482
$10,518
$7,828
$0
CTX + DOXO
CTX + DTX
ZA
CTX + DOXO + DTX
CPL + DTX + trastuzumab
Key: CPL – carboplatin, CTX – cyclophosphamide, DOXO – doxorubicin, DTX – docetaxel, ZA – zoledronic acid
Colorectal Cancer Mean Chemotherapy-specific Costs
$60,000
$41,482
$40,000
$20,000
$6,922
$5,544
$0
5-FU + LV + OX
$824
$13,204
$4,169
5-FU
$792
BEV + 5-FU+ LV + OX
$534
$5,474
5-FU + LV
$5,133
OX
Key: CPL – 5-FU – fluorouracil, BEV- bevacizumab, LV – leucovorin, OX - oxaliplatin
Lung Cancer Mean Chemotherapy-specific Costs
$14,002
$15,000
$8,781
$10,000
$5,000
$1,618
$2,901
$8,869
$8,725
$4,165
$3,111
$1,637
$1,377
$0
PL + PTX/ETO
PL + DTX
BEV+ PL + PTX/ETO
PL + GC
PL + VNR/TPT
Key: BEV- bevacizumab, DTX – docetaxel, ETO – etoposide, GC – gemcitabine, PL – platinum, PTX – paclitaxel, TPT – topotecan, VNR - vinorelbine
1. Xcenda, data on file. Site of Care Claims Analysis. September 2012.
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HOPD costs are 40% to 54% higher than community practices
for patients receiving non-targeted chemotherapy in breast, lung
and colorectal cancers. This is primarily driven by physician
costs being 89% to 1242% higher in HOPD vs community1
Breast Cancer Nontargeted Chemotherapy
Combinations
Colorectal Cancer Nontargeted Chemotherapy
Combinations
Lung Cancer Nontargeted Chemotherapy
Combinations
$18,000
$18,000
$18,000
$16,000
$16,000
$14,000
$13,149
$12,000
$15,902
$12,000
$12,000
$9,403
$8,000
$8,000
$8,000
$6,000
$6,000
$6,000
$4,000
$4,000
$4,000
$2,000
$2,000
$2,000
$0
Community
Hospital
$9,580
$10,000
$10,000
$0
$13,632
$14,000
$14,000
$10,345
$10,000
$16,000
$0
Community
Hospital
Community
Hospital
1. Xcenda, data on file. Site of Care Claims Analysis. September 2012.
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HOPD costs are 30% to 97% higher than community practices
for patients receiving targeted chemotherapy in breast and
colorectal cancers; however, lung cancer costs are comparable1
Breast Cancer Targeted
Chemotherapy
Colorectal Cancer
Targeted Chemotherapy
$35,000
$25,000
Lung Cancer Targeted
Chemotherapy
$20,000
$32,010
$20,236
$30,000
$20,000
$14,891
$15,050
Community
Hospital
$15,000
$25,000
$15,545
$15,000
$20,000
$16,214
$10,000
$15,000
$10,000
$10,000
$5,000
$5,000
$5,000
$0
$0
Community
Hospital
$0
Community
Hospital
1. Xcenda, data on file. Site of Care Claims Analysis. September 2012.
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The Value of Community Oncology
•
•
Care provided in
community officebased settings is
more accessible
and less costly for
patients
•
•
Patient out-of-pocket amounts are higher for patients
managed in an HOPD setting
Most common chemotherapy regimens for breast,
colorectal, and lung cancers are associated with lower
patient out-of-pocket payments in a community office
setting
When patients receive care in an HOPD setting, they
are more likely to wait longer for their first
chemotherapy treatment
Patients in rural areas are more likely to visit
community office practices, indicating that community
care is more accessible to these populations
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In a Medicare population, patient out-of-pocket amounts
are 10% higher for patients receiving chemotherapy in
hospital outpatient settings1
Cancer Type
Office-managed
Chemotherapy
Hospital-managed
Chemotherapy
Breast
$759
$814
Colon
$938
$975
Lung
$852
$847
Rectal
$690
$800
All cancers
$700
$773
84% of oncologists
say that patients’
out-of-pocket
spending influences
treatment
recommendations2
1. Fitch K, Pyenson B. Site of service cost differences for Medicare patients receiving chemotherapy. Milliman Client Report. 2011.
2. Neumann P, Palmer J, Nadler E, et al. Cancer therapy costs influence treatment: a national survey of oncologists. Health Affairs. 2010;29(1):196-202.
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With respect to common breast, colorectal, and lung
chemotherapy regimens, most patient out-of-pocket costs
are higher for hospital outpatient-managed patients1
Mean Patient Out-of-Pocket Costs for Breast Cancer Chemotherapy Regimens
$10,000
$5,376
$224
$116
$2,305
$561
$310
$344
$176
$725
$571
$0
CTX + DOXO
CTX + DTX
ZA
CTA + DOXO + DTX
CPL + DTX + trastuzumab
Key: CPL – carboplatin, CTX – cyclophosphamide, DOXO – doxorubicin, DTX – docetaxel, ZA – zoledronic acid
Mean Patient Out-of-Pocket Costs for Colorectal Cancer Chemotherapy Regimens
$10,000
$829
$958
$159
$1,051
$0
$95
$120
$6
$1,642
$1,087
$0
5-FU + LV + oxaliplatin
5-FU
BEV + 5-FU+ LV + OX
5-FU + LV
OX
Key: CPL – 5-FU – fluorouracil, BEV- bevacizumab, LV – leucovorin, OX - oxaliplatin
Mean Patient Out-of-Pocket Costs for Lung Cancer Chemotherapy Regimens
$8,342
$10,000
$5,347
$496
$288
$718
$2,466
$471
$1,781
$3,270
$441
$0
PL + PTX/ETO
PL + DTX
BEV + PL + PTX/ETO
PL + GC
PL + VNR/TPT
Key: BEV- bevacizumab, DTX – docetaxel, ETO – etoposide, GC – gemcitabine, PL – platinum, PTX – paclitaxel, TPT – topotecan, VNR - vinorelbine
1. Xcenda, data on file. Site of Care Claims Analysis. September 2012.
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Access to community clinics is vital for patients
in rural areas and Medicare beneficiaries without
supplemental insurance1
Medicare beneficiaries without
supplemental insurance
Location of first
chemotherapy course, n (%)
Patients in rural areas
Hospital infusion center/clinic
42 (22.3)
14 (21.2)
Hospital inpatient facility
21 (11.2)
6 (9.1)
Infusion center affiliated with
private oncology practice
60 (31.9)
21 (31.8)
Private doctor’s clinic
56 (29.8)
22 (33.3)
n=188
n=66
1. Shea AM, Curtis LH, Hammill BG, et al. Association between the Medicare Modernization Act of 2003 and patient wait times and travel distance for chemotherapy. JAMA.
2008;300(2):189-196.
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Changing Oncology Market
Landscape
The Value of Community Oncology
•
Patients in
community
settings utilize
more generics and
less brand
therapies, which
result in savings
for payers
•
•
•
Breast, colorectal, and lung patients managed
in a community setting are prescribed generic
chemotherapy more frequently
The maturing oncology portfolio will bring savings
through competition and higher generic utilization
in a community setting
Breast, colorectal, and lung patients managed
in a hospital setting are prescribed brand treatments
more frequently
An active pipeline creates more opportunity for payers
to adopt aggressive management policies for hospitalbased providers with high brand utilization
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Breast, colorectal, and lung patients managed
in a community setting are prescribed generic
chemotherapy more frequently1
Proportion of Patients Prescribed Generic Chemotherapy Only
90%
77%
80%
70%
60%
72%
68%
67%
Community
58%
57%
50%
40%
Hospital
30%
20%
10%
0%
Breast
Colorectal
Lung
1. Xcenda, data on file. Site of Care Claims Analysis. September 2012.
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The maturing oncology portfolio will bring savings
through competition and higher generic utilization
in a community setting
120
2014
Remicade
Leukine
Rapamune 2016
Enbrel
Evista
Erbitux
Xeloda
Zevalin
2013
Elitek
Neupogen
2012
Humira
Zometa
Eloxatin Xeloda
Prialt
Enbrel Taxotere
Vidaza Temodar
110
Generic/Patent Expiration
100
90
80
2008
Femara
Camptosar
Fosamax
70
2007
Kytril
Gemzar
60
2011
Etopophos
Xeloda
Aromasin
Femara
Anzemet
Istodax
Plavix
Avonex
Neumega
2006
Zofran
50
2005
Duragesic Transdermal
Sandostatin
Generic Introduced
Dacogen
Epogen
Procrit
Remicade
2015
Epogen
Aranesp
Rituxan
Epogen
Procrit
Gleevec
Aloxi
Neulasta
Peg-Intron
Emend oral
Alimta
2017
Neulasta
Sandostatin
Velcade
Tysabri
Iressa
Velcade
Xolair
2021
Sutent
Soliris
2023
Thalomid
2020
Nexavar
Tykerb
Revlimid
Vectibix
Sprycel
2018
Tarceva
Avastin
Herceptin
Clolar
2019
Revlimid
Zytiga
Exjade
Boniva
Orencia
By 2020, there will be a
robust portfolio of generic
and biosimilar treatments
Patent Expiration
40
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
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Breast, colorectal, and lung patients managed
in a hospital setting are prescribed brand treatments
more frequently1
Proportion of Patients Prescribed Any Branded Chemotherapy
50%
43%
45%
42%
40%
35%
32%
Community
32%
28%
30%
23%
25%
Hospital
20%
15%
10%
5%
0%
Breast
Colorectal
Lung
1. Xcenda, data on file. Site of Care Claims Analysis. September 2012.
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An active pipeline creates more opportunity for payers
to adopt aggressive management policies for hospitalbased providers with high brand utilization
• The presence of numerous treatment options gives payers the opportunity to adopt more
aggressive management policies by leveraging competitive market dynamics
Bladder cancer
Brain cancer
Breast cancer
Cervical cancer
Colorectal cancer
Head/neck cancer
Kidney cancer
Leukemia
Liver cancer
Lung cancer
Lymphoma
Multiple myeloma
Ovarian cancer
Pancreatic cancer
Prostate cancer
Sarcoma
Skin cancer
Solid tumors
Stomach cancer
Cancer-related conditions
Other cancers
Unspecified cancers
14
52
91
Nearly 900 drugs in
development for cancer
9
55
21
31
108
31
98
97
49
49
41
80
21
65
240
24
32
98
78
0
50
100
150
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200
250
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The Value of Community Oncology
Community
practices are more
willing to
participate in payfor-quality pathway
programs, which
will translate into
improved
outcomes and
savings for payers
•
•
•
Evidence demonstrates community oncology practices
are more likely to participate in pathways or pay-forquality programs
Pathway programs result in reduced costs of cancer
care by reducing the rate of both drug and nondrug
expenses
High community practice participation rates in pathways
programs creates an opportunity for payers to improve
care and reduce costs
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An opportunity exists for payers to leverage
community oncology practices’ willingness to
participate in pay-for-quality pathway programs
• Evidence demonstrates community oncology
practices are more likely to participate in
pathways or pay-for-quality programs1
– In a study where 362 oncology practices were
eligible for participation, the highest participation
rate was observed in community oncology practices1
Participation in Pay-for-Quality
Pathways by Practice Type (n=362
practices)
100%
– In a related study, the pathway program resulted in
reduced costs of cancer care by reducing the rate of
both drug and nondrug expenses2
80%
– Total savings, factoring out the increased fee
schedule for participating practices, was estimated
at $8,585,1482
60%
• Furthermore, pilot pathways programs suggest
that the saliency of pay-for-quality incentives in
academic and hospital settings should be
further studied1
88%
90%
70%
50%
49%
44%
40%
30%
20%
6%
10%
0%
Overall
Community
participants
Hospitalbased
participants
Academic
participants
1. Fortner BV, Wong W, Olson T, et al. Year one evaluation of participation and compliance in regional pay for quality (P4Q) oncology program. Poster presented at: International
Society for Pharmacoeconomics and Outcomes Research; Atlanta, GA: May 15–19, 2010.
2. Scott JA, Wong W, Olson T, et al. Year one evaluation of regional pay for quality (P4Q) oncology program. J Clin Oncology. 2010;28(Supl 15):6013.
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Summary
The Value of Community Oncology
Patients managed in an
office-based setting are less
costly than those managed
in hospital outpatient
settings
Care provided in a
community office-based
setting is more accessible
and less costly for patients
Patients in community
settings utilize more generics
and less brand therapies,
which results in savings for
payers
Community practices are
more willing to participate in
pay-for-quality pathway
programs, which will translate
into improve outcomes and
savings for payers
•
Three separate analyses of managed care claims in commercial and Medicare populations demonstrate that patients
managed in a community office setting cost less than patients managed in a hospital-based outpatient setting
•
Patients managed in a community office setting have lower hospitalization rates than patients managed in a hospital-based
outpatient setting
•
The majority of common breast, colorectal, and lung cancer chemotherapy-specific costs are lower for patients managed in
a community setting
•
Patient out-of-pocket amounts are higher for patients managed in an HOPD setting
•
Most common chemotherapy regimens for breast, colorectal, and lung cancer are associated with lower patient out-ofpocket payments in a community office setting
•
When patients receive care in an HOPD setting, they are more likely to wait longer for their first chemotherapy treatment
•
Patients in rural areas and Medicare patients without supplemental insurance are more likely to visit community office
practices, indicating that community care is more accessible to these populations
•
Breast, colorectal, and lung patients managed in a community setting are prescribed generic chemotherapy more frequently
•
The maturing oncology portfolio will bring savings through competition and higher generic utilization in a community setting
•
Breast, colorectal, and lung patients managed in a hospital setting are prescribed brand treatments more frequently
•
An active pipeline creates more opportunity for payers to adopt aggressive management policies for hospital-based
providers with high brand utilization
•
Evidence demonstrates community oncology practices are more likely to participate in pathways or pay-for-quality
programs
•
Pathway programs result in reduced costs of cancer care by reducing the rate of both drug and nondrug expenses
•
High community practice participation rates in pathways programs creates an opportunity for payers to improve care and
reduce costs
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Recommendations
• Know your audience:
– The value messages (as described on the previous slide) are likely to resonate best
with small to mid-size payers
• Educate on cost and quality outcomes in the community setting compared to the HOPD setting
• Smaller payers are likely more in touch with the local providers already, and therefore likely
need less convincing; mid-size payers are likely to need the most education and persuading
• Understand the hospital contracts and other drivers for large plans before approaching with
these messages and tailor them accordingly
• Generate and publish outcomes data to complete the value equation:
– While it has been demonstrated that community practices are more likely to follow and
participate in pay-for-quality programs, the outcomes of those initiatives have not been
widely analyzed and published – more data generation and publication on outcomes
are needed
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Thank you!