First ACO’s under Medicare’s Shared Savings Program: In addition to TEDMED, which this week gathered healthcare luminaries to discuss all things innovative, ACO was the other au courant acronym of the news cycle. Even as debate swirls about the fate of the healthcare reform law, there’s an obvious need to better coordinate healthcare, with ACOs being a topic of rare bipartisan politicking. Thus, its no surprise that accountable care organizations are alive—and growing rapidly—in numbers. On Tuesday, April 10 the Center for Medicare & Medicaid Services announced 27 healthcare organizations will participate in their Shared Savings program, while another five have signed on as advanced payment ACOs. According to the press release from CMS, the new ACOs will serve an estimated 375,000 patients across 18 states; that means together with the 32 pioneer ACOs, there are now 65 accountable care entities serving more than 1 million Medicare patients. But those numbers could quickly swell; some 150 other groups have applied to participate in the Medicare Shared Savings program starting in July. Moreover, a survey of more than 350 health executives released in the April issue of HealthLeaders finds provider interest in the concept is extremely high, with 39% of individual surveyed planning to implement or join an ACO in the future. Big payers like Cigna and Aetna are also taking advantage of provider interest to set up their own accountable models: on Monday April 9, Cigna announced the expansion of its collaborative accountable care model, adding provider partnerships in 7 states. The initiative now boasts 22 collaborative accountable care programs covering more than 270,000 members. Will such entities do enough to curb growing healthcare costs – that is a subject for another post.–HB
- Click here for the CMS Press Release and for more information about the 27 ACOS participating in the Shared Savings program; to learn about the Advanced Payment Model click here.
- Coverage from Kaiser Health News and the Washington Post can be accessed here and here.
- The HealthLeaders Report can be accessed here.
- The Hartford Courant charts Cigna’s ACO moves.
The US spends more on cancer care than Europe but is it worth it?: That was the question a team of researchers led by University of Chicago’s Tomas Philipson tried to address in an article published in Health Affairs’ April edition, which is devoted to exploring a number of issues tied to measuring value in oncology care. While the US spends more on cancer care than European countries, the researchers postulate this greater investment translates into greater value for stateside patients, since according to their findings patients live on average nearly two years longer than cancer patients in Europe. To reach this conclusion, the researchers (which also include Bristol-Myers Squibb executive Mitra Corral) cataloged treatment costs and survival for patients diagnosed between 1983 and 1999 in both the US and Europe, finding US-based individuals lived 11.1 years, while European counterparts lived just 9.3 years after diagnosis. The researchers then ascribed a dollar value to these additional life years and compared that figure to the additional costs of treating US patients to assess whether such costs were justified. Even after allowing for higher US costs of treatment, the researchers found the extra life years could be valued at around $600 billion, with the longer survivor time worth an average of $61000 per individual.
There you have it; you really do get what you pay for. Or maybe not. It didn’t take long for negative interpretations of the study to surface, albeit not in the WSJ where the editorial coverage was highly laudatory. Indeed, Reuters cites MD Anderson Cancer Center biostatistician Don Berry, who called the paper “pure folly”, “completely misguided” and “dangerous”. Indeed, he says the paper’s downfall comes from using survival data not mortality data to determine their longevity figures. As a result, the analysis falls victim to lead-time bias, an artifact that equates increased survival time with increased lifespan when early diagnosis means the only thing lengthened is the time an individual is living with the disease.
That wasn’t the only problem: another major issue cited by the American Cancer Society’s chief medical officer Otis Brawley was the researchers’ failure to compensate for overdiagnosis in the US compared to Europe. It’s well known that more cancers—many of which are earlier stage and slower growing—are identified in the US than Europe because of stateside screening policies. In this scenario, US patients would be labeled as cancer patients (but be considered healthy in Europe.) Their inclusion in the cancer cohort artificially inflates survival time says Brawley.
It seems unlikely the Health Affairs article will have much impact on policy either at home in the US or abroad. Why? For one simple reason: the escalating spend of oncology –20% annually—means even in the US payers can’t afford to pay for every cancer therapy any more. Thus, payers –whether they are health technology assessment organizations like NICE or national plans like UnitedHealthCare—must find ways to cut wasted or inappropriate oncology care to free up cash for newer, often targeted, agents that are effective. Because the truth is some expensive therapies do provide significant quality of life and overall survival gains and are thus worth their high price tags. But others aren’t all that much better than existing generics. In the words of Brawley it’s about moving away from arguments about rationing care to a “rationale use of care.” –Ellen Licking & HB
- Subscribers to Health Affairs can access the article here. For more on the study methodology, be sure to read the Appendix. http://content.healthaffairs.org/content/31/4/667.abstract
- Reuters weighs in on cancer costs and survival here.
- To hear more from ACS’s Otis Brawley, read this healthfinder.gov piece.
- The WSJ Op-Ed (with comments) “Cancer Care Grand Rounds” is here.
A CERtain Value to Comparative Effectiveness Research: In this week’s Pink Sheet, executives from GlaxoSmithKline and Optum Insight shed light on the need for pharma to take a more proactive approach to developing strategies, technologies, and infrastructure for comparative effectiveness research. The biggest take-home was that whether through the Affordable Care Act, through the market, or through successful research, strategies towards providing data on drug and device comparative outcomes is a logical and necessary step in the healthcare system. But that’s an obvious statement. The real question is how to design such studies to obtain meaningful data. The Patient Outcomes Research Institute (PCORI) is about to release its first Methodology Committee report, which will detail the methods to (optimally) improve CER research and implementation.
Develop CER Strategies Or Be Left Behind. [The Pink Sheet (Sub required)]
State-sponsored bills to keep patient out-of-pocket costs low: do they come with a price? Lawmakers from Maine to Hawaii are introducing bills to limit the out-of-pocket cost to patients for expensive drugs used to treat severe diseases like cancer, rheumatoid arthritis, multiple sclerosis and inherited disorders, the New York Times reported April 13. At least 20 states have introduced this bill, which would counter the payer trend of increasing the financial onus on patients to share the associated therapy cost burdens with insurers. The bill is a response to surging drug costs, especially so-called specialty medicines, where therapy costs jumped by 17.4% compared to 1.1% for traditional oral therapeutics, according to Medco Health Solutions. State regulators are concerned that patients, unable to pay their share of the costs, will forgo needed therapy, ultimately resulting in higher costs as a patient’s health deteriorates. The bill has obvious advantages for biopharmas: lowering the cost-burden for patients should increase drug adherence; as more patients fill scripts, that’s more revenue for biopharmas. But critics say biopharmas stand to benefit because the bill shields drugmakers from market driven initiatives that might encourage generic drug use, effectively translating a pricing issue into one tied to coverage, with payers bearing the brunt of the costs. Complicating the assessment is behind the scenes lobbying by individuals tied to big drugmakers. According to sources at the New York Times, Pfizer lobbyists have been very involved in the creation of the state bills, even drafting some of the legislation.