Value-based care seems like such a good idea. Who doesn’t want better health, and better care, at a lower cost? It is one of the premises of the MACRA legislation: “Change the way that Medicare rewards clinicians for value over volume.” We all think, in theory, preventive care is better than fixing problems after they occur. That’s why we take our cars in for regular maintenance, we have our furnace checked each year before winter, we get our teeth cleaned and checked every six months.

Yet, the current evolution to value-based care is adding burden and distracting from care in many ways, rather than focusing on the intended goals. I attended the Patient-Centered Oncology Care (PCOC) 2018, the annual meeting presented by The American Journal of Managed Care, last week and listened to some of our most highly-trained and most needed oncologists talk about how the current payment models have affected their practices. Oncology practices have been asked to take on risk for the cost of care and manage that cost. These practices are now responsible for costs that are not within their control, and that they don’t even know about until long after decisions have been made.

The problem with ‘payer models’

Sixty percent of the cost of care for an oncology patient is attributed to drugs. Should an oncologist prescribe a drug because it costs less? What if the more expensive drug yields better results? If we penalize the selection of the higher-cost drug, we could, in fact, be negatively affecting the patient’s health and ultimate outcome. In addition, Medicare and the Indian Health Service don’t provide adequate budget in their models for the new drugs that are becoming available. So, while it’s an exciting time in the evolution of cancer care and potential health outcomes, ultimate treatment decisions are burdened with considerations of the ‘payer models.’

(As a cancer survivor, I must say that I appreciate that my treatment was over 10 years ago, before the shift to value-based care, and little cost was spared in my treatment. Is that proper? Could I have been treated with fewer drugs at a reduced cost? I don’t know, but I’m happy that my treatment was as it was!)

Other costs that must be considered are the costs that the patient incurs for care at other locations. If the patient goes to the ER or is admitted to the hospital for treatment, related to their primary diagnosis or not, those charges are factored into the cost equation. Oncologists now need to understand the overall cost picture, weigh that against the new value-based models, and, some say, become actuaries as well as physicians.

Unintended consequences

Oncologists are being put in the position of taking on risk and becoming mini-insurers for care that they are not necessarily controlling. They don’t have actuaries or reserves, they don’t know the patients that will walk through the door for care, they don’t know the cost that will be incurred to care for those, and they may be required, under new models, to absorb losses. As a result, more and more independent practices are feeling pushed to sell their practices to a health system. This has been shown to as much as DOUBLE the cost of care.

Let’s work to update the system to focus on patient health, provider empowerment, and rational use of our resources.