Ranking Value in Cancer Care: Analysis of a "Pathways" Approach

Michael Kolodziej, MD, and J. Russell Hoverman, MD, PhD
Published: Monday, Aug 13, 2012


Dr. Michael Kolodziej

Michael Kolodziej, MD

Dr. J. Russell Hoverman

J. Russell Hoverman, MD, PhD

Author Affiliations:
From New York Oncology Hematology and Albany Cancer Center (MK), Albany NY; Texas Oncology (JRH), Austin, TX; and US Oncology (MK, JRH), Houston, TX.

Amid a continuing debate over healthcare spending in the United States, the oncology community is growing more introspective about the costs associated with increasingly sophisticated cancer therapeutics.

In April, an American Society of Clinical Oncology (ASCO) task force identified five practices that oncology specialists can employ to make treatment more cost-effective (J Clin Oncol. 2012;30(14):1715-1724). The ASCO annual meeting in June featured 44 abstracts that tackled cost-effectiveness issues, twice as many as in 2005, according to a Reuters news service analysis.

In this commentary, two physicians affiliated with US Oncology in Houston, Texas, analyze cost trends, regional differences, and potential alternatives. The article originally appeared in The American Journal of Managed Care in May (2012;18[3 spec no]:SP124-126).

The rising cost of healthcare is a topic of constant discussion and equally constant consternation. A lot of money is spent on healthcare in America, far more than in any other Western country, and over time, there has been tremendous inflation in this spending, particularly when indexed against the GDP.1 Oncology seems a particularly prominent passenger on this runaway train. Although oncology spending in both the commercial and Medicare sectors represents less than 10% of the total healthcare spend,2 several big-ticket items bring constant attention to this specialty. And why not, with immunotherapy costing $100,000 per course and oral targeted agents costing $5000 to $10,000 per month? These mind-boggling price tags seem out of reach for the average patient.

A major reason for the concern over the cost of these agents is the perceived lack of value. The clinical trials that have led to the approval of these agents often employ endpoints, or outcomes, that address only part of the value assessment patients must make. High cost may interfere with living longer or better, regardless of disease-free survival or disease stability.

The ability to rank “relative values” associated with our therapeutic choices should empower us to make wise decisions in healthcare. It allows us to maximize value. And to the extent that we can improve outcomes, it allows us to improve quality of care. Since the healthcare dollar has finite limits, objective, evidence-based treatment should help us do better with the dollars available.

Sadly, ample evidence suggests we have far to go. The best marker of how far short we are falling is the regional variability in healthcare spend. Seniors in Minneapolis cost Medicare $3341 per year, whereas in Miami they cost Medicare $8881 per year, twice as much.3 These variations are even more exaggerated when care during the last six months of life is analyzed. The data from the Dartmouth Atlas are most compelling.4 Utilization of all healthcare services, including hospital days, ICU days, and doctor visits, goes up. But what is most alarming is the variability from state to state and from region to region. For example, hospital days in the last six months range from seven in Utah and Oregon to almost 16 in DC and almost 12 in Florida. Office visits follow the same trends. Not unexpectedly, hospice enrollment follows an inverse relationship. Without question, socioeconomic factors explain some of the variability and there is no clear “quality standard” that allows definition of an appropriate benchmark. However, this much variability cannot be viewed as good.

This type of variability certainly occurs in oncology care, even on a much smaller scale. Our studies looking at charges for lung cancer therapy within a single large practice show wide interphysician differences.5 Notably, spend was not correlated at all with better survival. Patients cared for by the most expensive doctors did just as well (or just as poorly) as those cared for by the most thrifty doctors. In oncology, the spend is spread among several services and even several sites of service. Although there are some publications based on Surveillance, Epidemiology, and End Results data in the Medicare population,6 there was very little in the published literature to guide us in identifying where opportunities lie. We therefore entered into a partnership with Milliman to study costs of cancer care in the commercial population.7

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Community Practice Connections™: Addressing Post-Transplant Obstacles: Current and Emerging Strategies to Evolve the Standard of Care for Patients With Graft-Versus-Host DiseaseMar 28, 20192.0
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