Immunotherapies Can Kill Money Bonuses in OC Model

The Problem of Oncology's Rapid Change

Nick Mulcahy

June 13, 2019

CHICAGO — The federal government's Oncology Care Model (OCM) is based on the idea that you can motivate clinicians with cash rewards to improve care and reduce costs.

It's the first "value-based" payment model in US cancer care, started in 2016 and overseen by Medicare's Innovation Center.

Stephen Schleicher, MD, MBA, medical oncologist, Tennessee Oncology, Nashville, told Medscape Medical News that his group is a champion of the concept: "We are proponents of value-based care.... We want to improve it going forward."

However, Scheicher said that at Tennessee Oncology, there has been a consistent problem 3 years running: "We have been over target — or spending more than Medicare expected us to — for certain diseases, such as lung cancer and bladder cancer."

As a result, the multisite, Nashville-headquartered practice has not received any OCM performance-based money rewards.

In reaction, Scheicher and colleagues developed a hypothesis that they presented in a poster here at the American Society of Clinical Oncology (ASCO) 2019 Annual Meeting. Specifically, they said, "The ability for an oncology practice to successfully meet target costs may be hampered by the skyrocketing prices of novel therapy drugs implemented into clinical practice after baseline period cost calculations."

That last phrase is key to understanding why the center is not getting a big performance reward check in the mail.

The OCM's target or expected costs are all based on spending patterns as assessed during the OCM baseline period of 2012–2015.

But something monumental happened after 2015 — expensive, well-regarded immunotherapies were approved and became widely used in non–small cell lung cancer (NSCLC) and bladder cancer. Namely, nivolumab (Opvido, Bristol-Myers Squibb) and pembrolizumab (Keytruda, Merck & Co) were approved for NSCLC in late 2015, and atezolizumab (Tecentriq, Genentech) was approved for bladder cancer in 2016.

In their poster presentation, the Tennessee team concluded that use of these drugs for this pair of indications "poses significant challenges to practices" (that hope to cash in on the OCM payment scheme).

To have arrived at that conclusion, the team identified all NSCLC cases (n = 240) and bladder cancer cases (n = 31) from January to June 2017 at Tennessee Oncology, which has 30 locations and 90 oncologists.

The investigators assessed individual patients' targeted costs and identified all cases in which there was "above-adjusted target costs."

About half of the lung cancer cases (49%; n = 118) and about one third of the bladder cancer cases (32%; n = 13) had such above-adjusted target costs.

However, the inflated costs could not be explained by a trio of big-ticket items (emergency department visits, hospitalizations, or post acute care) in 53% of the NSCLC cases and 38% of the bladder cancer cases.

Notably, for those two groups of cases, rates of immunotherapy use were high — 69% for NSCLC cases and 100% for bladder cancer cases.

Furthermore, the study indicates that Tennessee Oncology was not haphazard in its use of the immunotherapies. For both cancer types, in around 80% of cases in which immunotherapies were used, that use was "guideline concordant."

The authors conclude — without ever saying it directly — that the expensive new immunotherapies, used per guidelines in large part, clobbered their payment bonus.

Something needs to change, they also say — explicitly. Medicare and the OCM need "more accurate ways to account for rising drug costs and expanding treatment indications to prevent penalties for following guideline appropriate care," they conclude.

Agreed, said Emeline Aviki, MD, MBA, a gynecologic oncology surgeon at Memorial Sloan Kettering Cancer Center, New York City, who has studied the OCM and other value-based care and payment models.

"The Oncology Care Model is an attempt to move the needle in value-based payment, but this new study shows there is more work to be done," she told Medscape Medical News.

Oncology is unique among medical specialties, Aviki believes, because of its "very rapid rate of innovation," which results in frequent changes in practice. The OCM payment model — even with a "novel therapy adjustor" as part of its scheme — is clearly not sufficient to accommodate that change, she added.

Happening Elsewhere, Too

Tennessee Oncology is not alone, suggested senior study author Aaron Lyss, MBA, Tuple Health, Washington, DC. "We heard anecdotally" about high-cost immunotherapies that had burst budgets among other OCM clinical practices, he told Medscape Medical News.

"We hypothesize that this expands well beyond these [NSCLC and bladder cancer] cases," said Schleicher.

Both investigators want the OCM to succeed. The purpose of the poster is to provide feedback to Ron Klein, MD, and others at the Centers for Medicare & Medicaid Services who run the OCM. "They have a very difficult job because cancer is so heterogeneous," said Schleicher.

About one third of US practices in the program have earned performance-based payments in any given performance period, said Lyss. So, more study is needed as to how this is playing out in different places, suggested Schleicher.

"My take-away is that there are some components where there is a separation of what we are accountable for vs what we can control," he said. "And we can't control the drug costs, yet this shows we are being held accountable for the related rising prices, which is concerning, because we don't have a lever to fix that."

Multiple study authors have financial ties to industry, including pharmaceutical companies that market immunotherapies. Aviki has disclosed no relevant financial relationships.

American Society of Clinical Oncology (ASCO) 2019 Annual Meeting: Abstract 6635. Presented June 1, 2019.

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