Staffing Costs for Oncology Practices Soar Amid Deluge of Paperwork

Meir Rinde
Published: Wednesday, Aug 24, 2016
George Kovach, MD

George Kovach, MD

In the early years of his practice, George Kovach, MD, had three employees. A secretary and a nurse worked at the office, and his wife managed the business from home. The relatively light work of sending out bills was delegated to the secretary, who also handled the phones and reception.

More than 30 years later, Kovach’s practice, Iowa Cancer Specialists, has three oncologists, a nurse practitioner, and 27 other employees, which works out to nine staffers per physician or about seven per clinician. That includes multiple secretaries, billing staffers, pharmacy technicians, medical technicians, and nurses. Although the practice is busier now and operates a dispensary, Kovach said a significant portion of the added personnel costs resulted from the ever-increasing administrative burden of running an independent practice.

In the past, “You sent a bill, you put a diagnosis on it, you put a fee on it, and out it went,” said Kovach, a past president of the Association of Community Cancer Centers (ACCC). “Now there’s more complicated billing—the new coding system, the multiple insurance companies, the authorizations—so you’ve got to add people to deal with that. The poor secretary at the front desk didn’t have to do any of that stuff.”

Preauthorizations for chemotherapy drugs and payers’ differing administrative requirements are two of the main contributors to greater hiring needs. Oncologists and practice managers also cite frequent coverage denials, lengthy appeal processes, payerspecific clinical pathways, financial counseling for underinsured patients, data-tracking initiatives, and night and weekend nurse triage services.

These developments have driven practice staff levels steadily higher in recent years. From 2005 to 2014, the average number of full-timeequivalent employees per physician rose from less than seven to 10, according to the National Practice Benchmark for Oncology.1,2 In addition, the total annual compensation for those staffers cost practices about $500,000 per hematologist or oncologist. The survey, whose participating providers typically have 10 or fewer physicians, found that the average practice has 1.2 billing staffers per oncologist and one patient financial counselor for every three doctors.

The explosion of new drug options that has transformed oncology in the last decade is central to the need for more staff, said Robin Zon, MD, past chair of ASCO’s Clinical Practice Committee and chair-elect of its Government Relations Committee. Payers struggling to manage the very high costs of newer, often narrowly targeted therapies now require practices to submit patient clinical data in advance to prove the requested drug is indicated for the patient’s disease.

“It isn’t the old days, where it was just a certain small number of drugs and they all knew it worked and they all knew the data,” Zon said. “You have to get the data, you have to show that it’s compliant with a pathway, and there’s a lot of back-and-forth. It’s not only a burdensome task on our staff, it’s also a burdensome task on the payer’s staff, because there’s constant interaction. It’s much more complex and time-demanding.”

Whereas once preauthorization often took less than a day, three to five days is now standard, and some patients’ Medicaid or Affordable Care Act policies ask for as many as 14 days, Zon said. “Now you’ve got to have staff that not only submit the request, you’ve got to have staff checking to make sure it’s being worked on and you get the information,” she said. “You have staff dedicated to the Medicare payers, to the Medicaidtype payers, and to the private payers, and even within the private payers it’s split up because the contracts may be different and there are different ways the staff has to follow up.”

Along the way, insurer denials also became much more common. Zon said that made sense for some requests, like expensive, overused scans, but not for every non-standard drug use. Such requests generate an “ever-revolving door” of denials and appeals, she said. Payers are also very resistant to covering research, so some practices must hire business staffers who are trained in the details of clinical trials.

In many offices, employees find themselves taking on a variety of roles as new demands arise. Andrea Anderson, practice manager for Bruce Hayton, MD, a solo oncologist in Wildomar, California, said her duties have repeatedly shifted over the years as the office has adapted to new administrative obligations and hired additional staff.

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