Cancer Care Delivery in a Time of Health Care Reform

1. Cancer Care Delivery in a Time of Health Care Reform Thomas W. Feeley, M.D.

2. US Health Expenditures: 1965-2017 $ billions

3. International Comparison of Spending on Health - 2007 From: Harvard Business Review, April 2010

4. International Comparison of Spending on Health 1980-2005 2009 – $8160 2009 – 17.3%

5. Costs of Cancer Care • NIH estimated the economic burden of cancer in 2010 to be $264 billion with $103 billion going directly to cancer treatment • Cancer care accounted for about 5% of health care spending in 2009 and that percentage is expected to increase • Costs are rising due to drug costs, diagnostics and procedure based therapeutics (molecular diagnostics, advanced imaging, IMRT, proton therapy, robotics)

6. Spending Attributed to Cancer 1990-2009 Elkin, E. B. et al. JAMA 2010;303:1086-1087

7. Rising Costs of Cancer Drugs From: Bach PB: N Engl J Med 360:526, 2009

8. Presentation Aims • How is cancer care affected by the American Reinvestment and Recovery Act of 2009 and in the Patient Protection and Affordable Care Act of 2010? • How will health reform affect cancer care delivery in different settings? • What should providers be doing to prepare? • Industry solution vs. government solution • Focus on quality, value and competition • What is happening in 2012 that may effect the reform movement?

9. How is Cancer Care Addressed in the American Reinvestment and Recovery Act of 2009?

10. Recovery Act of 2009 • Two Key Provisions: • Funding for Comparative Effectiveness Research • $1.1 billion allocated as of June 2011 • $109.5 million to NCI alone – additional funding AHRQ and HHS exceeding CER funding for heart disease • HITECH Act component in bill to improve our electronic interoperability • Funding for Meaningful Use of Electronic Health records

11. HITECH and Meaningful Use • $2 billion – allocated • Comments to CMS • realistic From: Blumenthal D: Launching HITECH. NEJM 362:382, 2010

12. How is Cancer Care Addressed in the Affordable Care Act?

13. The ACA and the Triple Aim Don Berwick, former CEO of IHI and former CMS Administrator - visionary with broad health sector support and his view of reform is his “triple aim” • Care coordination – integrated or coordinated care • Population health – access, prevention and early detection • Cost control

14. Cancer 2011;117:1564–74. April 16, 2011

15. The Affordable Care Act • Access improved through insurance reform mandating coverage, prohibiting preexisting condition exclusions, maintaining renewability • Delivery reform • From specialty based care to primary care • Reimbursement reform • From rewarding volume and intensity to rewarding quality and value – a balance between outcomes and cost

16. Access to Health Care Provisions • Increased coverage of uninsured by about 32 million, leaving about 23 million uninsured (about one-third are unauthorized immigrants). • The share of legal nonelderly residents with insurance coverage would rise from about 83 percent currently to about 94 percent. • Health insurance exchanges and increases in Medicaid will provide the coverage • Health insurers are likely attempting to build reserves – contract renegotiations with decreased payments • Focus for legislative and judicial challenges

17. What Else is in the Affordable Care Act?

18. Approaches to Delivery Models • Patient-Centered Outcomes Research Institute – an independent entity to advance quality and relevance • Center for Medicare and Medicaid Innovation – a CMS branch to test new delivery and reimbursement models new acting director – Richard Gilfillan MD– use of evidence based guidelines in cancer • Accountable Care Organizations – primary care • Patient Centered Medical Home – primary care • Healthcare Innovation Zones – primary care

19. Patient-Centered Outcomes Research Institute • PCORI will independently provide research for patients, clinicians and purchasers to inform decision making • Reliable information on health care choices through contracted CER and dissemination of CER in conjunction with AHRQ • Began operating 2011 with governing board and bylaws • Held first board meeting in May and also began public hearings • Funded through trust fund and budgets to spend $19.3 million in 2011 • HHS specifically prohibited from denying coverage due to CER findings

20. Center for Medicare and Medicaid Innovation • CMMI to test innovative delivery and reimbursement models • Established January 1, 2011 with Dr. Richard Gilfillan as director • First major effort was to develop language for Accountable Care Organizations • Specific directives in bill addressed use of evidence based guidelines to direct payments for cancer and development of Health Care Innovation Zones to reimburse academic medical centers • Testing of episode based payment plans

21. Center for Medicare and Medicaid Innovation • Partnership for Patients launched by CMMI in 2011 • Providers, hospitals, patients aiming to prevent hospital acquired conditions by 40% and reduce readmissions by 20% by 2013 • Would save 60,000 lives and aid 3.4 million patients in the two programs • Would save $35 billion dollars over 3 years and reduce costs of Medicare by $10 billion • Uses $1 billion from ACA for programs – half to test models through contracts and half to improve community transitions

22. Accountable Care Organizations • Partnerships between hospitals and physicians to coordinate and deliver efficient care (Fisher, 2006) • Envisions legal agreements between hospitals, primary care providers and specialists to incentivize improved quality and slow the rise of health care costs • Included in ACA as a shared savings demonstration program

23. Accountable Care Organizations • Began January 1, 2012 • Legal and management structure to receive and share savings • Must employ sufficient primary care professionals to treat minimum of 5000 beneficiaries • 3 year minimum, evidence based medicine • First proposed rules from CMI with many negative comments • Patients not excluded from specialty care for cancer • Many major players not in – Mayo Clinic, Memorial Hermann • Pioneer Program introduced as well as first year incentives

24. Accountable Care Organizations • Key Questions: • How do specialty hospitals and practices relate to ACOs? • Berwick – “practice triple aim” • Gilfillan – “find good partners” • What will happen to FTC and Stark provisions related to integration of care between hospitals and physicians? • How many ACOs will form outside the federal program? Many are planning • Can we achieve care coordination, population health and control of costs – Berwick’s Triple Aim – outside an ACO structure?

25. Patient Centered Medical Homes • There is a long history of medical homes or health homes – introduced by American Academy of Pediatrics in 1967 • Adopted as a primary care model by WHO in 1978 • The subject of hundreds of publications and dozens of demonstration projects

26. Patient Centered Medical Homes From: NEJM 362:1555, 2010

27. Patient Centered Medical Homes • While these were originally described as primary care delivery system and reimbursement reforms several specialties claim to be the medical home for their patients:

28. Patient Centered Medical Homes From: Casalino, et al: Specialist physician practices as patient centered medical homes, NEJM: 362:1555, 2010

29. Patient Centered Medical Homes

30. Patient Centered Medical Homes • Key Questions • Cancer programs clearly can not be a traditional PCMH for primary care • Should you consider becoming certified as a specialty medical home by National Committee on Quality Assurance? • Should cancer care programs simply declare and describe the fact that we function as a PCMH? Currently surveys of oncology programs ongoing.

31. Approaches to Reimbursement Models • Shared savings through accountable care organizations • National pilots on payment bundling • 5 year assessment of care in hospitalization from three days before to thirty days after • While federal demonstrations not for cancer – please watch carefully since private payers are very anxious to pay for bundled care • Cardiac care, orthopedics, transplantation, dialysis all good fits • Pressure to expand from private payers

32. How does the ACO Shared Savings Model Work? Initial shared savings derived from spending below benchmarks: There will be tremendous pressure not to refer outside an ACO

33. Why All the Interest in Bundled Payments? FROM: Hussey PS et al: Controlling US health care spending – separating promising from unpromising approaches. N Engl J Med 361:2109,2009

34. Bundled Payments for Cancer Care • Cancer good candidate for bundling • Must know your true costs of an entire episode of care • Bundling of cancer drug treatments • Bach proposal to Medicare • Newcomer pilot in United Healthcare

35. Bundled Payments for Cancer Care From: Bach PB, et al. Episode based payment for cancer care. Health Affairs 30:500, 2011

36. Quality Initiatives • Quality Reporting for Prospective Payment System (PPS) Exempt Cancer Centers • Quality Measures, Data Collection and Public Reporting • Pay for Performance Pilot for PPS-exempt Cancer Hospitals

37. Quality Reporting for PPS-exempt Cancer Hospitals • For FY 2014 and beyond, PPS-exempt cancer hospitals must submit quality data • Not later than October 1, 2012, the Secretary shall publish the measures selected. • The Secretary shall report quality measures of process, structure, outcome, patients’ perspective on care, efficiency, and costs of care on the CMS website. Section 3005

38. From: Spinks, et al. Health Affairs 30:664-672, 2011

39. Quality Reporting for PPS-exempt Cancer Hospitals Final List of PPS-Exempt Cancer Hospital Measures – Currently Under Review by CMS and their consultants Mathematics Policy Research and the NCQA: • Chemotherapy/hormone therapy measures (CoC/NCDB) • Adjuvant chemotherapy for Stage III colon cancer • Combination chemotherapy for AJCC T1cN0M0 or Stage II or III hormone receptor negative breast cancer • Hormone therapy for AJCC T1cN0M0 or Stage II or III hormone receptor positive breast cancer •  Hospital Acquired Infections (HAI) measures (CDC/NHSN) • Catheter-associated urinary tract infection (CAUTI) • Central line-associated blood stream infection (CLABSI) All are current NQF measures but being modified for use Next stage likely to include end of life measures

40. Quality Initiatives • Quality Reporting for Prospective Payment System (PPS) Exempt Cancer Centers by 2014 • First step in development of quality measures specific to cancer care • Pay for Performance Pilot for PPS-exempt Cancer Hospitals by 2016 • Few details but expect reimbursement based on measure reporting including payment for Hospital Acquired Conditions to be features. • Quality Measures, Data Collection and Public Reporting • Plans for the development, collection, and public reporting of quality measures for other providers

41. Additional Items of Significance • Coverage for individuals in clinical trials • Programs related to breast health education • Laboratory demonstration project in molecular diagnostics • Value based purchasing for hospitals based on core measures • Quality improvement research programs • Hospital readmissions • Independent Medicare Advisory Board • Professional education • Enhancement of nursing retention programs • Tanning and skin cancer prevention

42. Additional Items of Significance • Disease prevention provisions • National council • Task force • Media campaign • Wellness visits annually • Deductibles waived for colon Ca screening • State grants for tobacco cessation • Grants for community health and prevention

43. How Is MD Anderson Preparing for Health Reform ?

44. A Value Based Approach Value We must demonstrate the value of our care delivery model

45. A Value Based Approach • Understand our outcomes, report them and strive to continually improve them – survival and patient centric measures • Understand our costs and strive to control them • Time driven activity based cost accounting –(TDABC) • A cost accounting built around the entire patient experience • Must build in cancer care the transparent electronic systems that collect critical elements of outcomes and costs for internal improvement and external reporting

46. Outcomes Feasibility Study • 2468 patients with laryngeal, oral and oropharyngeal cancer • Survival from tumor registry, ability to speak and swallow from EMR • Findings • EMR required abstracting – meaningful metrics not searchable • Tumor registry required query • Need to input data so it can be regularly extracted easily

47. Costing Feasibility Study • 2468 patients with laryngeal, oral and oropharyngeal cancer • Costs from charge based system • Compare with time-driven, activity based costing (TDABC) using new cohort • Process map each patient encounter – first visit, imaging, surgery, chemotherapy, etc • Assign times and probabilities of elements and match with personnel costs • Calculate costs of episode or elements of an episode as sum of process costs

48. Using Charges to Measure Cost Center Line: Median Shaded Box: Interquartile Range (25th-75th %ile Extension Lines: 1.5x Interquartile Range Dots: Costs falling outside extension lines

50. Using TDABC to Measure Costs