Keeping a medical practice strong and independent in today’s turbulent environment can be quite challenging. More and more independent practices are struggling to remain viable, and some have chosen to either close or sell their practice to hospital systems or other institutions. At Woodlands Medical Specialists in Pensacola, Florida, we found another viable path to remain independent. We formed a collaborative relationship with The US Oncology Network, one of the nation’s largest networks of integrated, community-based oncology practices.

Woodlands is a physician-owned multispecialty outpatient clinic serving Florida’s Panhandle region. We have 22 specialized physicians and 10 advanced practice providers, including medical and radiation oncologists, urologists, primary care physicians, and an OB/GYN. We formed the practice 10 years ago when the group of urologists I was part of merged with a medical oncology group. The union was a win-win for both practices. We invested in building a 76,000 square foot facility to provide most of the services our patients needed, and over the years we have built a medical practice that is very unique and special in our area. Although it has been a struggle, we have been successful thanks to our knowledgeable administration that has navigated us through this difficult climate.

Just like other independent practices our size, succeeding has been an ongoing challenge in an environment with declining reimbursements and increasing costs. We also face a host of other issues. For instance, it is very difficult to compete against some of the larger hospitals, especially in the area of physician recruitment. Hospital systems offer higher reimbursement opportunities because of their access to capital. Additionally, it is difficult to find entrepreneurial young doctors who want to participate in ownership.

Collaboration With The US Oncology Network

With value-based care coming to the forefront, we are confronting even more challenges. We need capital to invest in critical resources required for new care and reimbursement models, especially analytic technologies. We also need better access to reasonably priced oncology drugs. Growing regulations and escalating costs have made securing these lifesaving drugs for our patients an ongoing battle.

We considered many avenues to raise needed capital and address other concerns, and we finally decided expansion would be our best option. Just as we began looking for a solution that would meet our needs, we were approached by The US Oncology Network. They were interested in expanding their footprint in Florida and were attracted to our business model for multispecialty care. During our discussions, they presented an affiliation arrangement that was exactly what we were seeking—a collaboration and not a takeover.

I am fortunate to be with a group of doctors where patient care comes first, and independence is a close second. We feel the best patient care comes from doctors treating patients independently without third party intervention dictating quantity over quality. When we met with The US Oncology Network and learned more about what they were offering, we felt extremely lucky to have found this opportunity. Becoming an affiliate of The Network was exactly what we were hoping for, as it gives us the chance to work with an organization with tremendous resources and expertise while retaining our autonomy to provide the patient-centered care that is at the very heart of what we do.

As an affiliate, we gain access to a wide range of benefits that will keep us strong and independent for years to come. We can tap into needed capital and critical resources that will strengthen and broaden our capabilities in many operational and clinical areas. For example, our ability to compete will be enhanced. While we have no problem competing with hospitals on quality of care, we cannot match their pricing. Joining The Network gives us buying power, which will be extremely helpful in obtaining cost-effective oncology drugs.

Other benefits will also be realized. The Network has a huge recruitment arm which will be a great asset. Teaming up with a large prestigious organization like The Network makes us more attractive to young doctors, as well as enhancing our image within the medical community. Additionally, we gain access to hundreds of cutting-edge clinical trials so we can offer our patients advanced treatments here in our local community. We are also excited about collaborating with the several hundred urologists who recently became associated with The Network through the acquisition of Vantage Oncology. As a practicing urologist, I believe access to this large group of urologists will give us tremendous opportunities to advance urologic care.

The expertise we are gaining in value-based care and practice management also played a role in our decision to join The Network. Our primary care doctors are already in conversations with The Network about value-based care requirements and expanding into ACOs, which are in their infancy in our region. The Network will also be using their analytic expertise and technologies to tell us where populations are located that need our services, guiding our future growth in the region.

The US Oncology Network also gains from the collaboration by adding Woodlands’ 22 specialized physicians to their organization and having the opportunity to work with an authentic multidisciplinary group. The Network is especially interested in learning more about primary care, which is a major part of Woodland’s business. They also extend their reach, broadening and strengthening the capabilities and knowledge- base of their organization throughout the Panhandle region.

Although it is hard to admit, independent practices must grow to survive. There is still a role for independent physicians, as they truly do provide the best medicine we can offer today. However, today’s complex environment has become overwhelming for small practices. One reason we joined The Network was to get bigger faster. Getting bigger provides some security, but practices must be careful to seek out the right group for their growth strategy. It is critical not to lose sight of quality care as the physician’s first goal, and staying true to core values is essential. Our decision to join The Network meets our growth criteria—it allows us to hold true to our values while helping us thrive in today’s evolving healthcare landscape.

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Keeping a medical practice strong and independent in today’s turbulent environment can be quite challenging.

Joining Forces Without Loss of Independence

It is almost unimaginable. Oncologists have waited for decades to offer their patients a better chance of surviving cancer, and now they can—for multiple cancer types. In unleashing the natural immune response to “foreign” antigens produced by malignant cells, we have shown conclusively that antibodies directed against so-called immune checkpoints (immuno-oncology drugs) can improve both progression-free survival and overall survival in a growing variety of cancer types. Because the immune system is capable of recognizing and reacting to any foreign antigen regardless of the tissue of origin of the malignancy, it is likely that indications for immuno-oncology drugs will continue to expand. Patients treated with immuno-oncology drugs are living longer and better than those who preceded the development of these agents. So, what could possibly be wrong with this story? Cost and reimbursement. As our story on this issue indicates, a new class of payer denials has emerged.

A growing chorus of complaints is manifesting across the country as payers absorb and react to the significance of this new class of expense—that the advances in outcomes are unquestionable and covered patients are demanding these costly drugs. The first wave of payer policy push-back, after liberal approvals and payments for immuno-oncology drugs, has been strict adherence to FDA approval guidelines. Precise indications including stage, ECOG performance status, dosage, total dose, and dose intervals are being scrutinized, resulting in waves of denials across the country. As one can imagine, denials can occur after the fact, with drugs being administered and then paid for only partially. For providers, the great expense of immuno-oncology drugs leaves little room for reimbursement shortfalls, particularly in the community setting. Next up will be controversy regarding the broader use of PD-L1 expression as an arbiter of approval. This soon will be followed by policy that addresses the duration of therapy in the metastatic setting. Approvals on combination therapy and retreatment for progression after response will further confuse the reimbursement story.

We all know that growth in expenditures in healthcare, particularly oncology, is not sustainable. We must remain vigilant, however, that we not confuse the cost of beneficial-yet-costly therapies with the total cost of care. We cannot afford to overuse immuno-oncology agents, given their expense and potential for toxicity. Similarly, the potential to change the natural history of lethal cancers mandates that our patients have access to these drugs when appropriate. Yet, we can ill afford to pressure payers any further. In place of “breaking a back,” we need to reduce the total cost of cancer care by avoiding too much or too little care and applying care appropriately, which now clearly includes proper use of immuno-oncology drugs. Now more than ever, there is a need for implementation of value-based care delivery so that we never have to worry about a ording effective therapies for our patients battling cancer.

It is almost unimaginable. Oncologists have waited for decades to offer their patients a better chance of surviving cancer, and now they can&mdash;for multiple cancer types.


Immuno-Oncology: The Straw That Breaks the Payer's Back?

The final rule for the Quality Payment Program (QPP) authorized by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) was recently released. This rule has two tracks for Medicare providers to choose from: the Merit-Based Incentive Payment System (MIPS) and the Advanced Alternative Payment Model (APM). Fortunately, there are a lot of positives for community oncology practices in the final details. Additionally, there are now several options for providers to participate in 2017 at a pace that meets their readiness:

Participate fully in MIPS. Submit data for all required measures in all categories for the full year and be eligible for the maximum positive payment adjustment.

Participate partly in MIPS. Report a minimum of 90 days of data including one Quality measure, one Improvement Activity, or more than the required measures in the Advancing Care Information (ACI) performance category to avoid negative payment adjustment and be eligible for a modest positive payment adjustment.

Submit some data. Report on one measure in the Quality category, one Improvement Activity, or the required number of measures of ACI to avoid a negative MIPS payment adjustment.

Participate in an Advanced APM and avoid MIPS participation.

​Oncology practices participating in the Center for Medicare and Medicaid Innovation’s (CMMI) Oncology Care Model (OCM) also have some readiness choices. These practices now have the option to participate as Advanced APMs in 2017. An Advanced APM is a two-sided risk model that totally exempts practices from MIPS participation. Those considering this option need to look carefully at the pros and cons of moving more quickly to a two-sided risk model versus participation in MIPS. The upside of the two-sided risk option is that practices are eligible for an additional 5% bonus payment from CMS, but they must achieve cost savings and improve patient outcomes, or they will face a penalty.

Practices that do not participate at all in 2017 will receive a 4% negative payment adjustment in 2019.

Now that the final MIPS rule has been issued, there are various activities practices can undertake to ensure they are well positioned to succeed when the program launches in January. The following are several critical areas all oncology practices should consider.

Engage your electronic health record (EHR) vendor about readiness for MIPS.

Understanding the practice’s electronic health record (EHR) MIPS capabilities and knowing when program reporting functionality will be available are critical first steps, as they enable the practice to determine which participation option is best for them. Requirements for the different levels of participation for 2017 must be closely examined and compared with practice readiness, both from technology and process standpoints. Once the level of readiness has been determined, providers can then decide if they are capable of submitting a full year of data, which would allow the opportunity for the maximum incentive payment in 2019.

Examine practice performance in the Physician Quality Reporting System (PQRS)

If neither the practice nor its technology is fully prepared to begin reporting on January 1, an action plan can be created to identify areas in need of improvement and plan corrections during the first part of the year. Practices have until October 2, 2017 to start collecting performance data and still avoid a penalty. However, the more they report, the more opportunity there is for a higher incentive payment in 2019.

Many oncology practices are participating in PQRS, a quality improvement incentive program providing rewards or penalties for reporting data to CMS. Those that are doing well in the program are in a good position to transition to MIPS because many of the quality reporting measures for MIPS are a continuation of PQRS, now called the Quality Performance Category.

Review and select measures for the Improvement Activities category

Practices not participating in PQRS may want to use the first nine months of 2017 to learn more about MIPS requirements and their readiness to meet these provisions. Start by looking at charting procedures. This will provide insight into which measures are the best fit for the practice based on patient volumes and other key factors related to MIPS quality measures. Part of this process involves engaging the practice’s EHR vendor to determine which measures are included in the EHR. Practices also need to make certain their EHR is fully certified for Meaningful Use, which is now called ACI.

The Improvement Activities category represents 15% of the MIPS 2017 composite score. Practices have to attest they have completed up to four improvement activities for a minimum of 90 days; therefore, the selected activity must be started no later than October 2, 2017. Activities are worth 10 or 20 points each, for a maximum score of 40. Practices with fewer than 15 physicians have only to complete two activities.

Examine the ACI measures and prepare to do more than the minimum

There are 93 different activities practices can consider, so there should be no difficulty finding several that are a good match for any particular practice. Practices should consider reporting on measures they are already meeting and just need to formalize the process or make minor changes to meet MIPS requirements. The intent behind this category is to drive innovation that benefits both the patient and the practice. The best way to approach this task is to consider activities that make the practice more efficient and effective in providing quality care to patients.

The final MIPS rule reduced the number of measures initially proposed for reporting in the ACI category, formerly called Meaningful Use. Practices will now be required to report on only five measures, representing 25% of their MIPS 2017 composite score. However, practices can raise their score by reporting on more than ve. The final rule included nine additional measures practices can submit. The maximum score is 100 points, but a score of up to 155 can be achieved by reporting on all 14 measures.

Decide whether to report as individuals or as a group

Practices should strive to do more than the minimum in this category. By talking to their EHR vendor now, they can make sure they are fully prepared to report on all of these measures. If their EHR is 2014 certified, these measures should be available. Practices should also make sure the vendor is prepared for the 2015 Edition Health IT Certification, which will be required in 2018.

Another important decision to make between now and the start of MIPS is whether to participate through group reporting or as individuals. If the practice has been participating in PQRS, they may want to report the same way after analyzing how well that approach has worked. Those not participating in PQRS should closely examine the pros and cons of reporting as a group versus individually. Some of this decision making will be driven by the performance of different physicians in the practice. If a physician is an outlier because of a different patient mix or other factors, group performance may be negatively impacted, and reporting individually may be preferred.

The MIPS final rule gives practices various options for participation, enabling them to transition into the program at their own pace. However, practices should be careful not to become complacent. While they may not have to participate fully in 2017, it is just a matter of time until they do. Value-based care is not going away, and this new way of reimbursement is only going to become more stringent and complex as time goes on.

Practices should immediately strive to gain an understanding of the various measures in each MIPS component, drilling down into the details. They should also be working closely with their EHR technology vendor to make certain they will be able to sufficiently report on MIPS requirements. If practices look at 2017 as an opportunity to learn and prepare for the future, they will be well on their way to building a strong foundation for value-based care while meeting the many challenges MIPS presents.

Linda Pottinger is director of Payer Initiatives, Innovative Practice Services, at McKesson Specialty Health.

The final rule for the Quality Payment Program authorized by the Medicare Access and CHIP Reauthorization Act of 2015 was recently released.

MIPS Transition: CMS Cushions the Leap to Value

Cheaper Treatment Options Are Not Covered

 Delivering patient-centered care is not an easy task in an increasingly complex environment, participants at the 4th Annual Institute for the Future of Oncology concluded at the June meeting. It’s tough enough that the pace of medical advances keeps oncologists hopping to keep up, and it doesn’t help that many aspects of care are not covered by payers, but forum participants enumerated other frustrating conditions for which solutions seem far off. These concerns were outlined in a white paper released last month by the Association of Community Cancer Centers (ACCC).

Institute members said financial incentives are sometimes misaligned, to the point that it may be easier to spend $10,000 on a drug that could have been avoided were it been possible to obtain payment for sending a nurse to a patient’s home at a much more modest cost of $1000. A variation on this theme was provided in the retelling of a case where a practice sought to visit nursing homes twice a week in order to administer a medication to patients with myelodysplasia so that the patients wouldn’t have to be transported to the cancer center or a hospital. However, payers wouldn’t pay for the drug unless it was administered in an office or a hospital. “Because of that, patient-centered care was killed—cut off at the knees,” the unidentified participant said, noting that the practice in question couldn’t afford to provide the drug without payment.

Another forum participant noted that the more bureaucratized and administratively centered the practice of oncology becomes, the further away from delivering actual personalized healthcare practitioners end up. The example of this he gave was that of precertification needs, which the unidentified participant described as mind-numbingly bureaucratic. “In the end, is that providing any true benefit for the individual patient?” he asked.

One problem forum participants said needs to be overcome in delivering better oncology care is the tendency to put labels on departments. They said current thinking tends to be skewed toward funneling patients into respective treatment centers rather than addressing their individual needs and then deciding what to do. This problem, an unidentified oncologist said, is readily apparent in the hallways of cancer centers where you see department signs that say “Thoracic Surgery,” “Radiation,” and “Chemotherapy.” If a patient comes to an oncologist with lung cancer, that’s where the directional system should begin, the oncologist said. “Our institutions and our payment systems and our infrastructure have evolved around the needs and the availability of the provider.”

Some in oncology tend to think that those with MDs after their names do not get the type of training they need to be capable of seeing the patient through the proper lens of empathy. Conversely, nurses are trained to function through the “psychosocial paradigm” and in that respect can deliver the appropriate level of patient-centered care, an unidentified participant said. “How medical students are educated, and how nursing students are educated, and how they approach the patient are drastically different.” The ACCC does offer a means to address this problem via a training program and resources that are aimed at bringing health teams into better alignment with patient-centered treatment goals.

For their part, physicians counter that it’s tough to deliver good patient-centered care in the space of a 15-minute visit. They have to be as efficient as they can be, and they cannot stretch their abilities to the desired extent. For example, the decisions that get made inside that 15-minute space of time with the patient tend to be “short term,” said one unidentified participant. “There aren’t any decision-making tools that help. You’re the patient’s cancer doctor for a short period of time. You’re dealing with the patient’s insurance company for a short period of time.”

And whereas time is often insufficient to accomplish a long list of tasks, physicians can find themselves pondering a multitude of drug alternatives, much like bewildered grocery shoppers staring at a multitude of brands in just the cereal aisle. “Lung cancer is not a disease with one treatment,” said a medical director. “There are genetic mutations and different options for every mutation. Yet, there are no head-to-head comparisons of those drugs, and there is a lack of clear guidelines as to which drug is the right drug for the right patient.”

“The example I give is the 90-year-old with kidney dysfunction and pancreatic cancer,” the director said. “I can give him FOLFIRINOX, I can give him gem-Abraxane, or I can give him gemcitabine. But without any comparative trials, I have to go with gut feel, and there’s no way to get value into that equation,” he said.

Another thing standing in the way of good quality patient-centered care is the film of opacity between people and departments that prevents the smooth flow of data for things like payment, best practices, and the cost of research and drugs. This all gets in the way of peer learning and the sharing of best practices, said a practice administrator.

Electronic health records can be lumped into this category of frustrations. Not only do different EHR systems not communicate with each other, even within a care system there are information access problems. In one practice it was explained that inpatient and outpatient records are not connected, which makes it difficult for patient navigators to do their jobs and answer questions about medical records and financial obligations. One program director said that a nurse coordinator was unable to prepare patients for their appointments because she couldn’t access new patient information to know what was needed before patients had to meet with the doctor.

Whereas a little integration of EHR systems would be a good thing, too much integration of cancer centers via mergers and acquisitions has had the effect of institutionalizing patient care and diluting the level of personal attention that is essential to patient-centered care, the participants said.

Finally, good patient-centered care means not putting too much responsibility on the patient and not ignoring the patient’s own preferences and persuasions, the participants said. For example, it is often left up to the patient to coordinate care that is far too complex for that individual to manage effectively. At the same time, it is important to know something about a patient’s cultural and gender-related standards and to allow the patient to some extent to define the value of the care being delivered. Some patients may not even want to know much about their condition and would rather leave some decisions up to the practitioner.

The forum report covered numerous current issues in oncology, but it also stated that the ACCC has various tools designed to help clinicians improve their communication with patients, including but not limited to a set of tools and resources to improve oral drug adherence, psychosocial distress screening, and communication with patients about metastatic breast cancer.

“New programs designed to address the financial barriers to providing patient-centered care, particularly the Oncology Care Model, have the potential to address many of these obstacles,” the report concluded. It defined patient-centered care as including seven core elements: patient stories; navigation and coordination; interdisciplinary teams; appropriate financial incentives; greater education; information technology connectivity and transparency; and decision-support tools.

Association of Community Cancer Centers. Empowering patients, engaging providers: the future of patient-centered care in oncology. http://accc-cancer.org/institute/pdf/2016-WhitePaper-Empowering-Patients-Engaging- Providers.pdf. Published October 2016. Accessed November 11, 2016.

Delivering patient-centered care is not an easy task in an increasingly complex environment, participants at the 4th Annual Institute for the Future of Oncology concluded at the June meeting.

Behind the Scenes, Value Is a Struggle

Many things are happening with payer practices as a result of the plethora of new immuno-oncology agents. Providers need to be aware of these developments and become substantially more cautious and vigilant about observing payment policies to avoid denials, said Niesha Griffith, vice president, Cancer Services, for the West Virginia University Health System.

Much more is at stake than previously in an unexpected drug payment denial, she said. Not only can practices be hit directly by financial expense but their staff members who regularly deal with payer interaction, billing, and coding can find themselves swamped with additional work. Griffith spoke on the issue at the September Clinical Immuno-Oncology National Conference, in Philadelphia.

Just because the FDA is approving new drugs doesn’t mean that providers can expect private payers to shape their policies respectively, Griffith said. In fact, confronted with rising expense, payers are becoming much more finicky about payment. This makes it necessary for providers to check and double-check approval requests and pre-certifications to make absolutely sure, because denials can still take practices by surprise, she said.

Private payers “originally started out approving everything for the FDA-approved indications, and now they actually have very specific coverage policies. You have to make sure that you meet those qualifications.” Also, she said, performance status rankings for patients have become a factor in approvals. Patients need to be in fairly good condition—cancer notwithstanding&mdash;to qualify. “Patients have to have a performance status of 0 to 2 to be able to receive these agents,” she said.

Providers must take care to fully understand payer policies and updates to those policies, and pharmacy personnel should sit in on discussions with payers to share perspective on how well the payment process is working. Payers can be unforgiving for overlooked updates or even small departures from policy, Griffith said. “When they finally do get a policy and post it, it may take a couple of weeks for you to actually get that information, depending on how information flows at your organization. And so, if they have a policy that maybe is a little bit more restrictive than the label and you didn’t know about it, you could end up having a denial, which is essentially what we’ve seen happen. They do not honor any type of retro-authorization.”

Getting the dosage right is another important safeguard to getting paid, Griffith said. Payers are actually calculating patients’ body weight to determine whether the dosage was figured correctly, and payment requests are being denied based on failure to meet this criterion, she added. Surprisingly, she said, drug payments are being held up by dosage calculations that are based on National Drug Code (NDC) labeling. NDC labels include manufacturer recommendations for strength and dosage form. Further, there’s a danger that approvals may not be sufficient for the amount of drug that is needed. Approvals may be disproportionate, meaning that the payer gives approval for nine months of a drug, but when a provider does the calculation it is discovered that there is only enough drug approved for a substantially shorter period of time, such as six months, Griffith said.

Payment for unused or “wasted” drug is a significant issue with expensive new oncolytics, as well, she said. “Not all payers will actually pay you for waste, and some will only pay you for part of the waste, not all of the waste. I’m not sure what the rhyme or reason is behind all of that, but again, it’s just one of the issues we’ve been seeing,” she said.

Oncologists are eager to use new drugs as soon as they become available, in both on-label and off-label applications. This makes it essential for practices to have clear and well-enforced policies on the use of new drugs so that their deployment doesn’t run ahead of the financial processes needed to pay for them, Griffith said. Physician activities should be scrutinized in this regard, “making sure the evidence is there, making sure the peer review is there, making sure that the patient’s been appropriately notified. Just make sure you have all of those pieces in place. If you haven’t done it, these drugs certainly beg it to be done.”

Nowadays, drugs often become available through wholesalers before payers have crafted a policy for coverage, she said. Doctors, meanwhile, have been following the trials and want to capitalize on the potential of these compounds right away. “We call the payer, and they don’t have a policy on that yet. It hasn’t held us back from using it if it’s on-label. We’re still calling, and we’re telling that we’re going to use it,” Griffith said.

Payers are having the same infrastructure problems that cancer centers are having, in the sense that they need to keep up-to-date with new drugs and their uses. It’s important for practices to leverage their knowledge by communicating with payers on these issues as often and as clearly as possible in order to influence their policy decisions, Griffith said. “What I’ve been seeing with the majority of the payers is that they don’t have the resources within their benefits departments to handle the amount of oncology and other medications that are coming to market so rapidly,” she said. “It’s not just oncology. There are a lot of new specialty medications that are also challenging payers.”

Patients also are following drug trials and want the drugs made available to them just as much as the doctors, Griffith said. This means that they, too, are sometimes impatient with the slowness of payers in establishing payment policies for new compounds. Those who have the personal financial resources will sometimes offer to front the costs of the medication just to ensure that they can get it, she said. “People really are willing to pay. There have been people who have said, ‘I’ll just write a check,’ and so we had to work through putting a system in place to actually accept payments from patients because it just wasn’t something that we’ve ever done before.”

Patients should be enrolled in any support programs that are available, and whenever possible, drug manufacturer eligibility personnel should be involved in the verification process to further diminish the likelihood of denials. “They’ll do a comprehensive overview of a patient’s situation, and they’ll be ready to provide support if we need it. It’s there. It’s free. I don’t know why anyone wouldn’t want to use it. Yes, it’s more work. It’s double because you’re doing your own pre-cert, but at the price tag of these drugs, I can’t imagine why you wouldn’t.”

Even after the payment clearances, you can’t assume the money will just ow in like it should, Griffith said, recalling a shocking, recent incident, when it was discovered that owing to a “glitch” at a Medicare contractor, the practice was receiving only about 10% of the actual drug cost, which caused her pharmacy department to go back and check their records “five times” over to make sure what they were seeing was actually correct. “It was amazing to me that we were the only ones in Ohio who had caught it, because there were other large cancer programs and it had been going on for well over a month,” Griffith stated. “It’s not just looking at your denials. I always tell people, ‘You’ve got to look at what you’re actually getting paid.’ I can’t say enough how important that really is.”

Many things are happening with payer practices as a result of the plethora of new immuno-oncology agents.

New Breed of Denials Is a Test of Fortitude

When a leading pharmacy benefit manager, CVS Caremark, announced in August that it would stop covering prescriptions at physician dispensaries for patients with Medicare Part D drug coverage, it fell to practice staffers like Tommy Harwood to deal with the resulting consternation.

Harwood is director of finance at North Shore Hematology Oncology Associates (NSHOA) and previously worked in its dispensary. For one of his affected patients, Harwood visited the man’s home and listened as he and his wife talked about their fears of a disruption of the care that had saved his life.

“He was like, ‘I was on IV treatment and I couldn't handle it, I wound up in the hospital twice, I almost passed away from sepsis, and now I have this platform to get this drug from you guys,’” Harwood recalled. “He had found some comfort and stability on a drug, and now he’s getting a wrench thrown in that, and he was upset. I didn’t know what to tell him. We really don't have control over it.”

Harwood, who serves as a co-chair of the Community Oncology Pharmacy Association (COPA), explained to the patient that he could continue getting the same oral drug through a retail or specialty pharmacy. A few months later, following strenuous protests by COPA and community oncologists who operate dispensaries, CVS Caremark reversed its decision. Harwood was able to call the patient and hear his great relief at being able to continue obtaining his medication from NSHOA.

Though CVS backed down, the episode illustrated a pitfall of the new era of oral oncolytics and the related trend of more in-house dispensing. As more oncologists provide pharmacy services, they are encountering competitive pressures from large, powerful drug distribution corporations that are highly focused on maximizing their profit from the lucrative oral oncolytics market, as well as a regulatory environment not designed to enhance the success of small, stand-alone dispensaries.

Community oncologists’ earnings from infusion and injectable drugs have fallen sharply over the last decade, due largely to the introduction of the average sales price (ASP) metric for Medicare Part B reimbursements. As that change pressures practice finances, and as more oral drugs become available, community oncologists are increasingly establishing their own dispensaries to capture a growing revenue source and maintain close oversight of patients’ treatment regimens. At least a quarter of new cancer drugs under development are oral drugs.

At least 521 community oncology practices have in-house dispensaries, accounting for 2226 oncologists, according to the Community Oncology Association (COA). Another 351 practices have retail pharmacies. According to studies cited in a COA white paper earlier this year, dispensing physicians comprise about 46% of specialty medical spending, and 14% of all prescriptions in 2014 were dispensed directly by a physician.

The opening of dispensaries was supported by the advent of the Medicare Part D prescription drug benefit in 2006. CMS regulations contain few specific references to physician dispensing, likely because it was a small part of the drug market when the rules were written, but the Part D regulations include “any willing provider” language that bars PBMs from arbitrarily excluding particular pharmacy providers.

One rule says plans “must ensure that Part D enrollees have adequate access to vaccines and other covered Part D drugs appropriately dispensed and administered by a physician in a physician's office.”

Yet in other places the regulations appear to push in the opposite direction or are ambiguous in their intent. Although PBM networks are defined as including only licensed pharmacies, state-level restrictions prevent many physician dispensaries from obtaining licenses. And while the rules strongly encourage PBMs to establish wide provider networks, they do so on the understanding that networks will exclude some outlets as they seek to keep a lid on costs for payers.

“If the medication is the same at a dispensary as it is at a community pharmacy and the price and member copayment are the same, CMS desires the member to have the ability to utilize the provider they want,” said Bartholomew Clark, RPh, MS, PhD, a professor of pharmacy sciences at Creighton University in Nebraska. However, “if I were the PBM, I’d have to ensure the provider is meeting my terms and conditions that are necessary for the various plan sponsors attracted to my service,” whether that’s Part D, commercial insurance, or some other type of plan, Clark said.

Pharmacy benefit managers started as prescription transaction processors and expanded into management of formularies and pharmacy networks, which they provide to the payers who contract with them. Five PBMs control networks for more than 80% of insured people, and they have long wanted more freedom to exclude pharmacy providers from their networks.

In 2014, the largest PBM, Express Scripts, along with CVS Caremark and some others, began excluding a group of compounding pharmacies they said were overcharging for drugs. The pharmacies responded by suing in federal court on the grounds that the ban amounted to a conspiracy by PBMs that control the vast majority of the insurance plan drug distribution. The case is pending.

This year CVS Health, the parent company of CVS Caremark, took aim at physician dispensaries. The reasons why they chose now to do so are unclear. In an e-mail, spokeswoman Christine Cramer said, “Through CVS Health’s ongoing regulatory review process, and following an inquiry we made to CMS earlier this year, we...determined that CMS considers physician dispensing facilities that do not have a pharmacy license to be ‘out-of-network’ providers.... We received confirmation from CMS on our interpretation of the rule related to the role of physician dispensers.”

She did not respond to an e-mail requesting more detail, and CMS refused to make a representative available for an interview or to discuss its role in CVS’s decisions. COA Executive Director Ted Okon said it was troubling that the federal government, which usually undertakes a lengthy public process before changing Medicare regulations, apparently signed off on a significant change in pharmacy practice though back-channel discussions.

“That would go against the rulemaking requirements at CMS. You just can't ask for soft, independent confirmation in a telephone call or an e-mail,” he argued. “It really requires formal rulemaking.”

However, Clark, who is an expert on pharmacy regulation and PBMs, said CMS favors transparency, and it was “logical” that CVS would ask for clarification of any challenging regulatory issues.

Okon argues that CVS Caremark’s exclusion of dispensaries was “clearly” a business decision aimed at steering patients to the national network of CVS retail pharmacies. “It wasn't that they woke up one day and realized that they were doing things incorrectly in violation of regulation,” he said. In the white paper released in August, attorneys for COPA allege that such a move by a PBM would violate federal anti-kickback statutes.

“It would seem logical to conclude oral oncolytic drugs could be easily moved into CVS pharmacies,” Clark said. “When you look at how the other four PBM companies are acting, it is easy to conclude that it may have more to do with Wall Street analyst expectations on same-store revenues than ‘compliance’ with regulations.”

The anti-competition issues prompted by industry consolidation and the integration of benefit managers with pharmacy chains are not the only concerns about PBMs. While the companies say they keep patients' prescription costs down, for years they have been criticized for maximizing their “spread,” which is the difference between what they pay pharmacies for a drug and the amount they then charge members’ employers. They also try to avoid disclosing their spreads to the public. Discontent over those practices has led to the rise of “fully transparent” PBM companies that charge only a flat fee for each prescription they administer.

Another growing issue that oncologist dispensaries face is the use of direct and indirect remuneration (DIR) fees. These include various types of fees, such as reimbursement reductions that PBMs extract from pharmacies in exchange for including them in their networks. Providers complain that these costs are “unnecessarily high and egregious,” Clark said. Certain other types of DIR fees are criticized for being extremely opaque. Federal legislation has been introduced that would ban retroactive DIR fees.

At the same time, Clark pointed to the benefits PBMs provide for consumers, such as easy claim management, large pharmacy networks, and lower out-of-pocket spending. The spending issue is particularly salient, given the astronomically high prices of newer oral drugs and increasing patient financial responsibility under many insurance plans.

Harwood and COPA say dispensaries operate more efficiently than retail pharmacies; they handle pre-authorizations and financial assistance issues themselves and get prescriptions out much more rapidly. They also facilitate care coordination, as patients who use dispensaries will contact their physician when problems arise rather than calling a pharmacist who will simply tell them to go the emergency room, Harwood said.

Yet for a patient who can barely afford his or her medicine, those benefits may pale next to the attraction of a smaller pharmacy copay. Hagop Kantarjian, MD, of the University of Texas MD Anderson Cancer Center, has led calls for lower cancer drug prices, and says he favors wide networks that allow patients to shop around. But Kantarjian, who said he was not familiar with PBM issues, said dispensaries’ success needs to be based on their prices rather than less-compelling arguments about care coordination.

“For outpatient oral drugs, I don't think that’s important. It's the same drug, whether you buy it through the doctor's office or the hospital or another outlet,” Kantarjian said. “It's possible if the patients fill their prescriptions in-house, those drugs are more expensive. It should be all based on the competitive pricing.”

Frier Levitt, LLC. Pharmacy benefit managers’ attack on physician dispensing and impact on patient care: case study of CVS Caremark’s efforts to restrict access to cancer care. http://www.communityoncology.org/wp-content/uploads/2016/08/PBMs_Physician_Dispensing-WhitePaper_COA_FL.pdf. Published August 2016. Accessed November 22, 2016.

Battle Over Oral Drugs Causes Disruption

It was 15 years ago that Jeffrey Brenner, MD, hypothesized that patients with the highest costs in the Camden, New Jersey, healthcare system received the worst care. He determined that by giving those patients special attention, care would be improved and costs would be lowered (

). His theory was scoffed at, but once it went into practice, attitudes changed.

Over three years, Brenner was able to reduce hospital bills by 56% and hospital and emergency department (ED) visits by 40%. Brenner coined the term “hot spotters” to describe the high-cost patients that he focused on.

Taking a page out of Brenner’s book, the Cone Health Care Center in Greensboro, North Carolina, has managed to employ his techniques to bring down the cost of oncology care. At the Association of Community Cancer Centers 2016 National Oncology Convention, Matthew A. Manning, MD, a radiation oncologist from Cone Health, explained how he and his colleagues used claims data and CMS information to improve results. Cone Health was able to lower costs by coordinating sub-specialty care, establishing a symptom management clinic, and better integrating palliative care. These changes led to fewer hospitalizations and ED visits and lower costs of death—typical outcomes from hot spotter-type programs.

These results were achieved, in part, through Cone Health’s involvement with Triad Health Network, an accountable care organization (ACO) that ties payments to quality metrics and costs of care. The ACO seeks to ensure that proper care is delivered to patients, especially the chronically ill, at the correct time, without duplication or error. ACOs also have access to Medicare claims data, which allows them to study their patients and identify the best ways to restructure care to achieve the ACO goals of proper, quality care, and careful spending.

Cone Health managers had the hot-spotter model from Brenner to guide their efforts, but they still had to determine whom among their patients fit the description of a hot spotter. They also needed to define the characteristics of a hot spotter and decide what could be changed in order to reduce care costs.

To locate their hot spotters, Cone Health looked at 2014-2015 claims data on 21,336 Medicare beneficiaries (

). Of those, 3942 had a cancer diagnosis in their CMS Hierarchical Condition Category (HCC). The patients were then separated into three cohorts based on how their annual claims compared with the ACO mean. The hot spotters were those patients with total annual claims of more than $50,000—representing 5% of the patients (216 patients total) studied at Cone Health.

However, without specific information on why patient costs were incurred, the providers were unable to create effective changes in care to reduce them. A clear profile of these specific hot spotters was needed—one that included cancer type, cancer stage, the treating oncologists, and the details of the patient’s treatment. To get all of the information required, chart reviews were performed of the hot-spotter cohort.

From that deeper understanding, the researchers realized that they needed more information about these patients than they were able to discern from the large pools of claims data. For example, a patient who had cancer and then incurred high medical costs from treatment—unrelated to that cancer could still end up on the hot-spotter list with a cancer diagnosis. To remedy this problem, the researchers created a ner lter, narrowing the 216 hot spotters to just 70 by requiring at least three visits to the cancer center within the study period.

The details of the hot-spotter patients’ medical characteristics were reported in a chart audit, which demonstrated that there was not one determining factor of a hot spotter. There wasn’t one predominant tumor type, stage of cancer, or particular physician/sub-specialist who was treating the patients.

It had been assumed that because cancer treatment is costly, cancer was behind the high expense for this small cohort of hot spotters. However, the researchers at Cone Health discovered that wasn’t the case.

Although medical characteristics couldn’t lend much insight, there were similarities in the hot spotters’ costs: of the 70 patients studied, 90% had ED visits and 60% were hospitalized. Largely, the hot spotters who ended up in the ED and hospital had multiple comorbid HCCs, most commonly dialysis/renal failure, congestive heart failure (CHF), and chronic obstructive pulmonary disease.

The researchers then studied how the costs of these patients were being generated and found programs that already at the cancer center that could be developed to “close some of the loopholes and reduce costs,” said Manning. Similarly, ED visits, hospitalizations, and the cost of death were put under scrutiny for possible economies.

Manning said that patients were ending up in the ED or hospital when they had comorbidities across “silos” because the coordination between these specialty centers was very poor. The development of cross-silo care helped to close this gap in patient management. Manning cited a Breast Cancer Heart Failure Clinic within his hospital as an example of good cross-silo management. Because women taking trastuzumab (Herceptin) are at high risk for CHF, they are prospectively referred to Cardiology for screening. This clinic reduces the risk of a patient ending up in the ED or the hospital due to a cancer-related problem.

Too many patients die in the intensive care unit because they do not have proper end-of-life care, Manning said. It was known that hospice enrollment and palliative care intervention can drastically reduce the cost of medical care in the final year of a patient’s life, as well as costs to the hospital. So, Cone Health launched a pilot study in this respect, integrating palliative care into the Brain and Spine Oncology Clinic for six months. This included an increase in goals of care, advanced directives, do-not-resuscitate orders, and hospice enrollment. In those six months, the changes led to savings of $364,000 for the hospital.

Because oncologists’ schedules are tight, many oncology patients end up in the ED when problems arise. Additionally, “large number of patients end up in the ED for pain management,” Manning said. Cone Health therefore established a Symptom Management Clinic (SMC) to offer patients with cancer a better option than relying on the ED. Under the supervision of the Medical Oncology Department, patients were seen at this clinic for pain and other symptoms related to their disease and adverse events of treatment—all serious and common conditions, but not emergencies. Manning stated that in the first year of the SMC, “Cancer patients seen in our ED were decreased by 24.5%.” Manning added that the Hospital Outpatient Quality Reporting Program has added a measure to track admissions and visits to the ED involving patients who receive inpatient chemotherapy. Poor performance, or too many ED admissions from this patient population, could result in a negative effect on a hospital’s Outpatient Prospective Payment System’s payment rate.

High-tech treatments can be costly and seem like good candidates for reducing costs. However, the benefit in care that these technologies provide is not something that patients can afford to lose, according to Manning. “Our data suggest it’s not the advanced technology that’s costing,” he said. “It’s the way we’re managing patients.” As an alternative to cutting treatments such as trastuzumab and stereotactic radiation therapy, Manning suggested that “providers can cut down spending by better managing high-cost patients.” At his hospital, providers were able to make major strides in savings without cutting any access to these treatments.

Before cutting effective, low-risk treatments, it is wise to try an integrated network of care, Manning said. Better management of patients through primary care physician involvement, multidisciplinary safety nets, and fewer ED visits can help providers to reduce costs without lowering the standard of care. All it takes, according to Manning, is careful monitoring of costs and the use of data to inform effective changes in care.

Manning MA. Collaboration across specialties to improve care and curb costs. Paper presented at: Association for Community Cancer Centers 33rd National Oncology Conference; October 2016; St. Louis, MO.

It was 15 years ago that Jeffrey Brenner, MD, hypothesized that patients with the highest costs in the Camden, New Jersey, healthcare system received the worst care.

High-User Focus Trims Oncology Tab

Value-based reforms from CMS have been received like extra work at the end of a long hard day. It hasn’t helped that making the leap to patient-centered care has involved grappling with a new set of quality metrics and wringing higher levels of performance out of electronic health reporting systems. Among oncologists, it’s generally accepted that this transition away from volume-based medicine is ultimately going to be a good thing. But to call the level of excitement “feverish” would be an exaggeration.

However, there’s one group out there that could be described as almost gleeful about the future of medicine in a risk-based environment. Roy Beveridge, MD, senior vice president and chief medical officer of Humana, recently told a group of oncologists at the Patient Centered Oncology Care (PCOC) conference in Baltimore that payer metrics conclusively indicate that patient care improves as physicians become more vested in patient outcomes. According to Beveridge, better outcomes mean more focused medicine and less waste, which, in the payer view, means savings.

, read about why Beveridge believes that CMS’s quality metrics-based reforms are going to dramatically improve medical results. The report from last month’s PCOC meeting is on page 15.

This month, we’ve also included a report on a super-utilizer solution that originated in Camden, New Jersey, and was successfully replicated by an oncology center in Greensboro, North Carolina. Cone Health worked to understand its most costly set of oncology patients and find out how their expenses could be reduced without adverse effect. The health center found a number of ways to improve the coordination of care and keep those super utilizers from overusing emergency departments and hospital beds. Our story, on page 10, explains what was done. Cone Health’s experience is a useful lesson for institutional and independent oncology care centers alike.

CVS has had to back down from its planned policy of refusing to supply Medicare Part D oncolytics to in-house dispensaries, to the enormous relief of independent oncology practices across the country. It is not clear what type of discussions occurred between CMS and CVS that led to the decision not to go ahead with the sequestration, which would have begun in January, but many insist that in-house dispensaries have an important role to play in oral oncolytic distribution. Still, patient advocate Hagop Kantarjian, MD, University of Texas MD Anderson Cancer Center, contends that patients should obtain their drugs from the lowest-cost suppliers, which are retail pharmacies in many cases. Some would counter that “lowest cost” means better managed care and less drug waste, which is why in-house dispensaries contend they are superior to retail pharmacies. Our story about this still-simmering issue is on page 8. Be sure to read it.

Also, check out our many other offerings this month. Our issue includes an update on CMS’s Quality Payment Program and its physician performance standards. There’s also a close-up look at some of the policies that payers have adopted to control the cost of immuno-oncology drugs. Enjoy!

Value-based reforms from CMS have been received like extra work at the end of a long hard day. It hasn’t helped that making the leap to patient-centered care has involved grappling with a new set of quality metrics and wringing higher levels of performance out of electronic health reporting systems.

Humana CEO Cheers for Risk-based Models

A test that may be considered beyond next generation in the oncological disease testing market is getting a trial run from Horizon Blue Cross Blue Shield of New Jersey with help from a growing patient database known as COTA. Officials said the GPS Cancer test has the power to drill down into RNA activity to help doctors understand how well a drug will work against a tumor. They said the kind of information this test produces could prove revolutionary in its potential for accurately guiding medical decisions.

“We can now for the first time interrogate or decide whether the tumor itself has a resistance factor to Taxol before you decide to give Taxol,” said Patrick Soon-Shiong, MD, founder of NantHealth, which developed the GPS Cancer test and is partnering with Horizon and COTA in a trial involving patients with pancreatic, colon, breast, lung, and pediatric cancers.

“For years we’ve treated cancer without being informed by a patient’s specific DNA, but we all have unique genetic profiles which react differently to different treatment approaches,” said Mary Ann Christopher, chief of Clinical Operations and Transformation at Horizon. “The GPS Cancer test allows health professionals to understand an individual person’s genetic profile and the unique biology of the tumor and then design a very specific and personalized course of treatment.”

A number of cancer centers in New Jersey and elsewhere are participating in the study which will accrue patients over the next 12 months. Those centers include Hackensack Meridian; The Cancer Institute of New Jersey; Robert Wood Johnson, Barnabas; the RCCA network of independent cancer centers; and the University of Pennsylvania. The initial trial size is 160 patients.

Soon-Shiong said previous tests of GPS Cancer have shown strong advantages gained by doctors and patients. Horizon’s Christopher said the payer will be looking closely at a number of factors to determine whether GPS Cancer lives up to the claims being made about its potential. She said the promise of the test is that it offers a greater degree of comprehensiveness in understanding the particular genomic and proteomic profiles of patients, allowing for “very individually precise intervention.”

“We’ll be looking at the degree to which information coming out of the study has that influence and informs physicians’ decisions about the treatments and regimens of patients. That will clearly be one of the early outcomes of the study,” Christopher said. “The others will be how does the use of the study influence, ultimately, things like quality of life and comorbidities, because patients may have been treated with one regimen versus another, and how frequently patients wind up in the emergency department.” Total cost of care will also be examined using COTA tracking, she said.

Whereas many genomic assays are available for biomarker guidance, Soon-Shiong said GPS Cancer goes further than those. “What we have here is a PET scan of tumor tissue, which gives us knowledge or new diagnostic information at the molecular level of the biologic activity of the cancer tissue. What’s exciting is that it’s clinically relevant in terms of timing—you have this information before you make the clinical decision what chemotherapy to give or what therapy choices you can choose from.”

Andrew L. Pecora, MD, founder and executive chairman of COTA, said that an advantage of GPS Cancer is that it can tell physicians what not to do, as it is important not to stress or weaken the immune system with therapies that have no efficacy. “The idea is to find the truth—what is the best healthcare and what is the best value healthcare, and what the GPS does is it allows you to further refine what is the right thing to do, what is the wrong thing to do.”

COTA steps in by capturing, cataloging, and reporting that data. Another advantage of COTA is that its broad information base deeply categorizes patient and disease subtypes and amounts to a library of information that can leverage the yield of even small trial sample sizes such as the 160 patients to be enrolled in the GPS Cancer trial. “You don’t need these huge trials to answer questions. You can do it with a limited number of patients,” Pecora said.

Achieving the kind of analysis that the GPS Cancer test can do requires enormous computing power, Soon-Shiong said. A number of remote processing facilities are used to provide the combined capacity needed, a network Soon-Shiong described as covering 300,000 fiber optic miles. “Finding the mutations, doing the RNA analysis of the pathways, and then doing the quantitative proteomics in an academic’s hands would take three months to do, and that’s of no use, no clinical use. A patient needs that decision in two weeks,” he said. “So, we built a computing infrastructure that moves data at terabytes a second, and we’ve completed 21,000 of these analyses in 7000 patients. The amount of computing storage capacity that’s needed is beyond the capacity of any academic institution, beyond the capacity of the National Cancer Institute, and beyond the capacity, clearly, of a community oncologist.”

A test that may be considered beyond next generation in the oncological disease testing market is getting a trial run from Horizon Blue Cross Blue Shield of New Jersey with help from a growing patient database known as COTA.

December 2016 | Oncology Business News®