New payment models that reward cost-effective, high-quality cancer care are needed. An experimental physician payment model that rewards physicians for focusing on best treatment practices and health outcomes rather than the widely used fee-for-service (FFS) model resulted in cost-savings, without affecting the quality of care among patients with 3 types of cancer. The findings were published early online in the Journal of Oncology Practice (Newcomer LN, et al. 2014 Jul 8. Epub ahead of print). An accompanying commentary is discussed in this issue on page 29.
In a pilot study that began in October 2009, 5 medical oncology groups collaborated with UnitedHealthcare to use an episode-based payment model, which reimbursed physicians based on the expected cost of a standard treatment regimen for the specific condition, as predetermined by the physician. The oncologists were paid the same fee regardless of the drugs that were administered to the patient. Patient visits were reimbursed using the FFS contract rates, and chemotherapy medications were reimbursed based on the average sales price. The oncology groups collaborated with UnitedHealthcare to develop more than 60 measures of quality and cost to compare the performance across groups and to determine how to improve quality and reduce costs over the 3-year study.
The study, which was conducted between October 2009 and December 2012, covered 810 patients with breast, lung, or colon cancer, and examined the difference in cost before and after the payment change. The researchers reported that the predicted FFS total cost for the episode cohort was $98,121,388, but the actual cost of medical care per episode for patients in this study was $64,760,116, representing a 34% reduction in medical costs for a savings of $33,361,272.
The predicted cost of chemotherapy medications was $7,519,504, but the actual cost was $20,979,417. The researcher noted that the tested model still produced a 34% overall cost-savings.
The episode payment model showed significant savings for cancer care, without any measurable effects on quality outcomes or toxicity, concluded the researchers. They said that this study challenges the assumption that any reduction of resources results in worse outcomes for cancer. In addition, this model allowed each medical group to seek the solutions that worked best for its environment. Although this pilot should be replicated to answer questions about generalization, the researchers point out that this study validates a key concept that the cost of care for future generations can be reduced, without sacrificing quality.
