Accountable Care Organizations: Implications for Oncologists

1. HEALTH POLICY
Accountable Care Organizations:
Implications for Oncologists
By Rhonda Greenapple, MSPH, President and Founder, Reimbursement Intelligence, Madison, NJ
T
he journey for healthcare cost- ures of quality of care and population According to Dr Cobb and Mr Okon,
savings is a never-ending pro- health. A provider may be required to “An oncology provider participating in
cess. One of the newest health- meet minimum quality standards to an ACO will be under enormous pres-
care delivery models, which is continue to participate in an ACO. sure to simply control or reduce costs.
mandated for Medicare beneficiaries The law allows any number of Supporters argue that ACOs are differ-
in the healthcare reform law, is the organizations to form an ACO, includ- ent from HMOs, in part because they
accountable care organization (ACO). ing physician group practices, practice are not just about cost-savings—quali-
This new model requires ACOs to networks, hospitals, hospital–physi- ty measures must be satisfied.
focus on primary care, but it has impli- cian systems, and other groups. However, there are no quality meas-
cations for oncologists as well. Oncologists, like other specialists, ures for cancer treatment. Furthermore,
“Oncologists, like other
cannot take the lead in launching and although there is a nod to quality, no
Oncologists Can Join, Not Start, managing an ACO, but they can join as one should kid themselves—ACOs are specialists, cannot take
an ACO many ACOs as they wish. really all about saving money.”1 the lead in launching
An ACO is a network of providers They cite the following hypotheti-
and managing an ACO,
that agrees to manage all of the health- cal example: “What happens when
care needs for a defined population in a new $93,000 prostate vaccine or but they can join as many
“The potential savings in
a specific period—at least 5000 pri- $120,000 melanoma drug becomes ACOs as they wish.”
mary care Medicare patients for at clinical oncology will be available? These expensive new ther-
least 3 years. In effect, an ACO is an driven by the design of apies will threaten to break the ACO
integrated system that attempts to bank, putting the pressure squarely Cost versus Quality in Oncology
incentive structures. The
eliminate fragmented care for Medi- on the oncologist to either keep the An ACO management will have to
care beneficiaries and coordinate their more oncologists are allowed patient’s best interest or that of the address the delivery, measurement,
entire care—prevention, diagnosis and to provide cost-effective ACO as highest priority. Few oncolo- and cost of quality of cancer care. The
treatment, and the continuing man- gists will want to be placed in that issue of quality versus cost may result
care, the more likely they
agement of chronic diseases, as well as position.”1 in clinical dilemmas between primary
aftercare. will be to participate.” Overlook Medical Center in care physicians and oncologists. For
The ACO requires providers to man- —Alan Lieber Summit, NJ (part of Atlantic Health), is example, for a cost-conscious primary
age all the health needs of their covered in the process of creating 2 ACOs. In care physician, the high cost of cancer
populations. The cost-saving is expect- a phone interview in May 2011, surgery could function as a disincen-
ed to come from eliminating unneces- Few Quality Measures for Overlook’s president, Alan Lieber, tive to refer a patient to a surgeon. The
sary or redundant procedures, sharing Cancer Care pointed out, “The potential savings in physician could instead suggest a less
clinical information among providers, Of the 65 proposed quality measures clinical oncology will be driven by the expensive course of chemotherapy.
and meeting quality targets that allow outlined in the ACO law, only the pre- design of incentive structures. The Dr Cobb and Mr Okon summarized
providers to keep a portion of the sav- ventive measures of screening for more oncologists are allowed to pro- it best; “The burning question is ‘who’
ings. Providers will be paid more for colon cancer and mammography relate vide cost-effective care, the more likely oncologists are accountable to—pay-
keeping their Medicare patients specifically to cancer care. Patrick they will be to participate.” ers (in finding cost-savings), or their
healthy and out of the hospital. Cobb, MD, Chairman of Community patients (in providing quality cancer
Under this new model, providers Oncology Alliance (COA) and the care)? Certainly, at a time when cancer
must collect and report utilization and COA Policy Committee, and Ted Okon, incidence and treatment costs are both
cost data to the Centers for Medicare
and Medicaid Servcies and for their
Executive Director of COA, outlined
the challenges for oncologists in a
at a glance increasing, oncologists bear some
responsibility for controlling costs. The
ACO population, as well as on meas- recent article on OncologyStat.com. ® ACOs are now mandated by strategies for doing so include provid-
the healthcare reform law for ing care, for example, that minimizes
Medicare beneficiaries emergency room visits and hospital-
The Challenge of Value-Based... ® Oncologists cannot start an izations and using evidence-based
guidelines to control treatment costs,
Continued from page 20 ACO, which is focused on
primary care, but they can join when possible. However, first and
point of diminishing returns is after ASP plus 20% for each, the physician such a program, and will likely foremost, oncologists are accountable
the second line of therapy. is likely going to use drug B, to get be affected by it to their patients in providing the high-
The second issue is, if drug A and the 20% of $1000 instead of 20% of est quality cancer care.”1
® Of the 65 proposed quality
drug B have very similar outcomes, $100. If we can find a few of these The jury on ACOs will be out for a
measures outlined in the ACO
but drug A is much less expensive, “big therapies” with similar clinical long time. ACOs must prove that they
law, only colon cancer screening
then the ability to use drug A for the outcomes, then we will reimburse enhance overall healthcare quality,
and mammography relate to
majority of the time and cover A for much higher for a generic drug and while also reducing costs. As for oncol-
cancer care
the majority of the time is a big issue. still save costs. ogists, they must become familiar with
From a payer’s standpoint, it may Finally, no payer wants to end up in ® The potential savings in ACO rules and regulations to deter-
have to be done by adjusting the reim- the news for saying they denied care oncology will likely be driven by mine the best way they can contribute
bursement away from the way reim- because they did not value 4 months of the incentive structure in such a model. I
bursement is traditionally done. life or 2 weeks of life. In pancreatic ® The burning question,
For example, using an average sell- cancer, there is a drug approved based according to Dr Cobb and Mr Reference
ing price (ASP)-type reimbursement, on 2 weeks of survival benefit. Is this Okon, “is ‘who’ oncologists are 1. Cobb P, Okon T. Just ‘who’ is the oncologist account-
able to in an accountable care organization?
which is a percentage-plus reim- value? In cancer, 4 months is actually a accounted to—payers…or their September 7, 2010. www.oncologystat.com/view
bursement, where drug A costs $100 fairly decent amount of time. These are patients” points/cancer-policy-forum/Just_Who_Is_the_
Oncologist_Accountable_to_in_an_Accountable_Care
and drug B is $1000, if you reimburse major challenges for payers. I _Organization.html. Accessed May 31, 2011.
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