Reimbursement and Managed Care News: July/August 2007

By Stanton R. Mehr
Published: Wednesday, Jul 07, 2010
%u25BA ASCO Spotlight:

     Focus Groups and Advisory Boards: To What Extent Do They Supplement Oncologists’ Income?

The implementation of the average sales price reimbursement formula for chemotherapeutic agents administered in oncology has had a significant effect on the income of a typical oncology practice. A researcher from Totowa, New Jersey, sought to find out if oncologists were taking advantage of the many advisory board or focus group invitations they received for conducting market research.

Based on surveys of oncologists in private practice and academic hematologists and oncologists, Dr. Kenneth Hoffman found that private practitioners received each week on average six invitations to participate in Web-based market research boards and one phone teleconference. He noted that most of the respondents received two or three invitations each month for ad boards for which they would have to appear and travel; they attended the majority of them.

The greatest predictive factor of whether the oncologist would participate in the market research activity was the amount of money offered, not the topic. It seemed that $150/hr was the minimum amount offered that would help ensure participation. However, Dr. Hoffman revealed that academicians were less likely to participate in Web-based conferences in any case; 55% said they did not even open the invitation.

Dr. Hoffman concluded that “market research is playing an increasing important role in the financial health of many physicians.”

   Hoffman KR: Evaluating a new income source for medical oncologists: Market research. Presented at the annual ASCO meeting, Chicago, June 4, 2007.

%u25BA ASCO Spotlight:

    The High Overhead Cost of Complying With National Guidelines

Implementing electronic medical records (EMRs) and reporting of data on quality of care are important activities, but they are not inexpensive from the oncology practice‘s perspective. Health insurance plans and payers for care want contracted physicians in their networks to be of optimal quality, and they want the means to measure meaningful differences among practices.

One multisite oncology practice, based in West Covina, California, utilized an EMR to evaluate compliance with practice guidelines, and then sought to quantify the overhead costs associated with maintaining this quality of care. Applying its assumptions to an HMO patient population of 75,000 covered lives, the investigators included EMR developmental costs, operational costs, personnel time, and training.

Direct costs for computer hardware cost $25,000, personnel training was $10,900, and EMR licensing was $12,500. Annualized costs were estimated at $184,900 (see Table for breakdown). Direct costs per covered lifewere $0.645. Overhead costs per covered lifewere $2.704 per year.

The investigators conclude that the costs to maintain quality oncology care and ensure compliance with treatment guidelines “are substantial and must be reimbursed by health insurance plans and HMOs.” A better understanding of these costs may assist oncology practices in negotiating care contracts with health insurers that seek to monitor quality of care.

Annualized Costs of Maintaining and Collating Data from Electronic Medical Records in an Oncology Practice

EMR Maintenance Fees                                            $1,000

IT Consultants                                                             $4,500

Physician Time to Enter Patient Data                   $58,000

Nursing Time to Enter Treatment Data                  $7,650

Physician Training                                                    $11,250

Senior Administrator Coordination                        $30,000

Administrative Supervision                                      $17,900

View Conference Coverage
Online CME Activities
TitleExpiration DateCME Credits
Community Practice Connections™: 18th Annual International Lung Cancer Congress®Oct 31, 20181.5
Provider and Caregiver Connection™: Addressing Patient Concerns While Managing Chemotherapy Induced Nausea and VomitingOct 31, 20182.0