A three-year program spearheaded by UnitedHealthcare held down costs of cancer care but leaves researchers wondering exactly how it did so. “The source of the cost savings is enigmatic,” say the authors of the study, “Changing Physician Incentives for Affordable, Quality Cancer Care: Results of an Episode Payment Model,” published online in the Journal of Oncology Practice on July 8.

That’s because while overall costs of treatment dropped by a third when compared with patients who were not part of the study, the cost of cancer medications soared. This, despite the fact that one of the primary factors in the three-year study was to remove financial incentives for doctors prescribing oncologic medications.

UnitedHealthcare tracked 810 cancer patients in five large oncology practices between October 2009 and December 2012. The practices, which volunteered to participate in the bundled payment pilot, are in Ft. Worth, Marietta, Ga., Dayton, Ohio, Memphis, and Kansas City, Mo.

“Medical oncologists were paid a single fee, in lieu of any drug margin, to treat their patients,” the study states. “Chemotherapy medications were reimbursed at the average sales price, a proxy for actual cost.”

The predicted medical cost for the group was about $98 million, but came in at about $65 million instead — a remarkable savings of about $33 million.

However, researchers had predicted that about $8 million would be spent on cancer drugs. The actual amount was about $14 million.

Researchers cited several incentives to curtail cancer drug costs. According to the study, they were:

  • If the selection for a chemotherapy regimen yielded a lower drug margin than the UnitedHealthcare national average for the episode, the group’s episode payment was raised to the national average, providing an incentive to select low-cost regimens when appropriate.
  • The oncology practices did not realize any gains by switching to higher-priced drugs.
  • The metastatic episode payments continued every four months, even if the patient was no longer receiving chemotherapy. This policy was intended to compensate the oncologist for the additional work of palliative care.

The groups met twice during the study period to review whether they had hit benchmarks for 60 measures of cost, quality, and use. “They had not been exposed to performance data about their practice from any source before joining this project,” the study states. That might have triggered the Hawthorne effect, whereby a person or group does better when it knows it’s being observed.

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There’s a lot more going on in health care than mergers (Aetna-Humana, Anthem-Cigna) creating huge players. Hundreds of insurers operate in 50 different states. Self-insured employers, ACA public exchanges, Medicare Advantage, and Medicaid managed care plans crowd an increasingly complex market.

Major health care players are determined to make health information exchanges (HIEs) work. The push toward value-based payment alone almost guarantees that HIEs will be tweaked, poked, prodded, and overhauled until they deliver on their promise. The goal: straight talk from and among tech systems.

They bring a different mindset. They’re willing to work in teams and focus on the sort of evidence-based medicine that can guide health care’s transformation into a system based on value. One question: How well will this new generation of data-driven MDs deal with patients?

The surge of new MS treatments have been for the relapsing-remitting form of the disease. There’s hope for sufferers of a different form of MS. By homing in on CD20-positive B cells, ocrelizumab is able to knock them out and other aberrant B cells circulating in the bloodstream.

A flood of tests have insurers ramping up prior authorization and utilization review. Information overload is a problem. As doctors struggle to keep up, health plans need to get ahead of the development of the technology in order to successfully manage genetic testing appropriately.

Having the data is one thing. Knowing how to use it is another. Applying its computational power to the data, a company called RowdMap puts providers into high-, medium-, and low-value buckets compared with peers in their markets, using specific benchmarks to show why outliers differ from the norm.
Competition among manufacturers, industry consolidation, and capitalization on me-too drugs are cranking up generic and branded drug prices. This increase has compelled PBMs, health plan sponsors, and retail pharmacies to find novel ways to turn a profit, often at the expense of the consumer.
The development of recombinant DNA and other technologies has added a new dimension to care. These medications have revolutionized the treatment of rheumatoid arthritis and many of the other 80 or so autoimmune diseases. But they can be budget busters and have a tricky side effect profile.

Shelley Slade
Vogel, Slade & Goldstein

Hub programs have emerged as a profitable new line of business in the sales and distribution side of the pharmaceutical industry that has got more than its fair share of wheeling and dealing. But they spell trouble if they spark collusion, threaten patients, or waste federal dollars.

More companies are self-insuring—and it’s not just large employers that are striking out on their own. The percentage of employers who fully self-insure increased by 44% in 1999 to 63% in 2015. Self-insurance may give employers more control over benefit packages, and stop-loss protects them against uncapped liability.