Independent community oncologists play a vital role in cancer treatment for hundreds of thousands of Americans.
Independent community oncologists play a vital role in cancer treatment for hundreds of thousands of Americans. In fact, nearly 55% of patients with cancer in the United States receive treatment in the community setting.1 Community practices provide patients with access to local, good-quality treatment that allows them to stay close to family, friends, and other forms of support. Also, it is widely acknowledged that community oncology is the lowest-cost setting for care, especially when it comes to travel expenses and other common barriers to care. With questions regarding Medicare Part B and the recent update to the tax code up in the air, 2018 is turning out to be a year of uncertainty for community providers. Now is a critical time for oncologists to engage with these issues by advocating for themselves and their peers while also becoming more efficient, transparent, and accountable in order to realize greater opportunities in the future.
Like all other industries, healthcare does not exist in a bubble. Outside forces from a variety of stakeholders affect providers of all kinds. Regulatory pressures and shifting laws and guidelines can pose a threat to the viability of community practices, because many regulations limit payment for treatments and services. Community oncologists operate on razor-thin margins, which makes the slightest policy or regulatory change potentially catastrophic to their bottom line and overall viability. This is especially true when it comes to Medicare Part B. Any additional regulation that lowers payment under Part B could render it impossible for community oncologists to continue to operate effectively and efficiently.
Over the past several years, independent oncology practices across the country have built innovative and sound infrastructures to deliver increasingly complex chemotherapy regimens. From establishing infusion centers to in-office dispensing of oral oncolytics, community practices are now commonly responsible for managing and maintaining inventory of specialty products to treat their patients. To sustain this level of treatment, practices buy product at risk, with the understanding and hope that they’ll be properly paid at the average sales price (ASP) plus 6% down the line. However, regulators continue to limit payment.
Under the Budget Control Act of 2011, automatic sequester cuts, including a 2% per year reduction in Medicare spending, were established to keep federal spending in balance with rising national debt. This lowered payment for a drug to ASP plus 4%, cutting community oncologists’ operational income by nearly 30%. Any further regulation limiting Part B payment would make the infusion and dispensing systems community practices have built untenable. There’s already significant pressure for oncologists to be more aggressive about collecting payments from Medicare, other payers, and patients, and this additional change could push community oncologists to a place where they are no longer able to maintain in-office inventories of chemotherapy treatments.
On December 22, 2017, President Donald Trump signed the Tax Cuts and Jobs Act of 2017 into law. This reduced taxes for individuals and businesses and repealed the individual mandate included in the Affordable Care Act. Additional Medicare sequester cuts are expected, because the policy is projected to add $1.5 trillion to the federal deficit over the next 10 years. In addition, the recent tax bill included the Pay-As-You-Go Act mandate: Legislation must pay for itself or across-the-board spending will be cut. These cuts would hit community oncology practices hard, challenging the viability of their operations and reducing their ability to support patients who turn to them for convenient, affordable, and specialized care.
In the face of these impending regulatory and legislative complexities, the onus falls on community oncologists to advocate for themselves and their patients, be leaders in value-based care, and be more transparent and accountable. Since the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, oncologists have become more politically active, but there is still a long way to go. Many regulators do not understand the benefits of community oncology or how Medicare Part B changes affect these practices. By defining their value to legislators, community oncologists would gain support and be less vulnerable to lobbies whose interests are on the other side of the table.
When oncology practices speak as one, policy can change. The Medicare Part B prescription drug model is a prime example. The experiment was intended to limit spending on cancer treatments administered in outpatient settings, including chemotherapy and biologics. In May 2017, the Community Oncology Association (COA) submitted a formal letter requesting cancellation of the program, citing its negative impacts on patients—specifically, the elderly—and community providers. By November, the experiment was abandoned. This type of concentrated effort will help enact meaningful change that allows physicians to continue providing the highest-quality care.
Many resources can guide oncologists who want to educate themselves on the issues shaping the future of their care. The advocacy program Community Counts2 provides information on regulatory issues affecting community oncologists. Professional societies such as COA, the American Society of Clinical Oncology, and the Association of Community Cancer Centers are also fantastic hubs for information.
In addition to keeping abreast of regulatory changes, physicians must learn how to operate more transparently. For example, electronic practice management and clinical systems can streamline business. Electronic practice management systems automate the billing, claim processing, revenue management, and reporting functions that would ordinarily be performed manually by staff. The time saved can be used to focus more on patient care. However, to best implement these tools, providers need to apply pressure to vendors and regulators who control data sharing so that interoperability and standardization evolve to fit the needs of community practices. As this happens, these tools will help improve conformance with treatment guidelines and policies on payment. Also, by having data at hand, practices can clearly see where payment gaps exist and work to close them.
The technological resources available now are breathtaking. Clinical decision-making, cost-management, and revenue-management tools are critical resources for evaluating a practice’s overall health. Resources such as Innovation Cancer3 connect practices to critical technology that can review and monitor inventory, payer contracts, and treatment regimens, providing a critical level of support to practices.
In this new era of value-based care, community oncologists should champion for models of value and cost-effectiveness that help them become more efficient and viable. These healthcare professionals are uniquely positioned to be leaders in valuebased care, as their deep ties to the communities they serve allow for more streamlined management of care. Initiatives like the Oncology Care Model (OCM) use financial incentives to promote high-quality, coordinated care. The Center for Medicare & Medicaid Innovation is creating additional pilots that would save money for Medicare and Medicaid, and there is opportunity for community oncologists to opt in early. By participating in the OCM and other value-based care models, community oncologists can address patient needs and be paid appropriately for the care they provide.
While questions around Medicare Part B cuts and the tax bill’s impact may make the forecast for community oncologists seem bleak, opportunities do exist. Community oncology continues to be a positive driver in the evolution of new payment models and programs. This year, we expect to see the results from the OCM program and find out whether it becomes more widely adopted. With new and innovative treatments in the pipeline, community oncologists will play a significant role in how these therapies will reach patients. By continuing to advocate for themselves and become more efficient, transparent, and accountable, community oncology practices can continue to stand as vital resources for high-quality, lower-cost care in their communities.