Strategies to Reduce Cancer-Care Costs

Extract

Payment for cancer care will change radically over the next decade as the nation struggles to hold down health care costs, experts told an early October Institute of Medicine forum, Delivering Affordable Cancer Care in the 21st Century.

Traditional fee-for-service medicine, in which oncology reimbursement relies disproportionately on profits from expensive chemotherapy drugs, will give way to a variety of alternative payment mechanisms that Medicare and insurance companies are now testing. These systems include bundled payments for episodes of care, value-based insurance design, and shared savings models linked with pay-for-performance programs that reward physicians who adhere to standardized treatment protocols.

“If you think it’s been a tough reimbursement environment up to now, just wait. It’s going to be much, much tougher in a year or two,” said Mark McClellan, M.D., Ph.D., former administrator of the Centers for Medicare and Medicaid Services and now director of the Engelberg Center for Health Care Reform at the Brookings Institution. Given societal demands to hold down health care spending, “the unavoidable conclusion is that we can’t keep doing things the way we’ve been doing things.”