Transitioning to value based care in medical oncology is a major strategic change in any medical practice. In this presentation to Grand Rounds at the Norris Cotton Cancer Center at Dartmouth, we look at the strategic and operational considerations of making such a transition effective.

1. Transitioning to Value Based Care:
Tennessee Oncology
A Case Study
Presentation to Norris Cotton Cancer Center
Grand Rounds
October 7, 2014
Wes Chapman

2. Disclosure Statement
• I do not have any financial interests.
• I do not intend to discuss off-label or
investigational use(s) of a product or
device.
• I attest that I am not receiving direct
payments from a commercial entity with
respect to this activity.

3. “Oncologists should become value-based
providers by eliminating unnecessary tests,
prescribing cheaper alternatives when
therapeutic equivalents exist, and keep calling
for payment reform”
Ezekiel J. Emanuel, MD, PhD
ASCO Annual meeting, 2014

4. Tennessee Oncology at a Glance
• Community oncology “mega-practice” – 85 physicians, 25+
locations, 40+% state market share, 70+% market share in
service area
• Nashville based – 3 hospital system market
– HCA, Ascension affiliate (St. Thomas), Vanderbilt
• Long-standing referral relationships with HCA & Ascension
• Very large clinical trial presence through Sarah Cannon
(SCRI) – 2nd largest Phase 1 unit in US
• QOPI certified, Aria (Varian) EMR in all practices,
standardized billing through GE Centricity
• Participates in Mission Point ACO via St. Thomas

5. Getting to Know TN Oncology
Embattled Self Image

6. A Self Image Founded in Harsh Reality

7. 7
MARKET PRESSURE ON COMMUNITY
ONCOLOGISTS
• Over last six years
– 331 clinics closed
– 600 merged or acquired
– hospital acquisitions/agreements due to
huge margin advantage:
• Site of service differentials for
hospitals is huge revenue advantage
• 340B pricing gives non-profit
facilities huge cost advantage
* Community Oncology Alliance Report. April 2014.

8. Exacerbating the Cost Growth in Cancer Care

9. Cost Drivers Wreaking Budgetary Havoc

10. 10
NOTALL CHANGES ARE ADVERSE
THREE CRITICAL POLICY SHIFTS ARE UNDERWAY
1. Reference pricing – elimination of site of service differentials
approved by CMS *
2. 340B seems to be under scrutiny for reduction – opposition from
pharma, private providers, payers
3. CMS is expanding favorable program development:
1. COME HOME medical home project
2. End of life palliation program via CMMI
3. Solicitation of opinion for Value Based Care Models in Medical
Oncology
* Obama administration okays reference pricing. FierceHealthFinance. May 18, 2014.
* Insurers Push to Reign in Spending on Cancer Care.Wall Street Journal. May 27, 2014.

11. Adapting to a Changing Environment

12. A Brief Review of Our View of Value Based
Care
Source: Aetna Inc.

13. VALUE-BASED CARE HAS ARRIVED IN ONCOLOGY
13
Inherent variation
Special cause variation
PQRS, MU, V-b
purchasing
EMR
Pathway technology
Risk stratification tools
Patient triage services

14. 14
VALUE-BASED CARE HAS ARRIVED IN ONCOLOGY
Inherent variation
Special cause variation
- Generic vs. branded drug utilization
- bundles
Cost management technology
Utilization management services
Private oncology ACOs, Payer
sponsored bundles

15. 15
OUR FOCUS - COMMERCIAL HEALTH PLANS
PROBLEMS
Commercial health plans are paying too much (cost) and receiving
too little (value).
1. Regimens – controlled by MD
2. Formulary – controlled by FDA, and practice
3. Utilization management solutions – controlled by third
parties
4. Patient management – Typically not delivered
5. Transparency – No plans, no audits

16. 16
PAYER SELF IMAGE – PAINFUL LOSS OF
CONTROL
1. Reporting requirements without control
• Publicly transparent quality scores (NCQUA HEDIS scores)
2. Provider reluctance to adopt:
A. Payment for value models
B. Payment for savings models
C. ACOs
3. Oncologists “control hearts & minds”
4. No auditability of pathways,
bundled payments or otherwise

17. TN Oncology Incentives to Value Based Care

18. ALIGNED CONCEPTS OF VALUE
PAYER – PROVIDER – PATIENT GOAL ALIGNMENT
18
Cost
Reduction
FFS
Pathway
attribution
Bundles
Quality Improvement
PCMH

19. EVOLUTION OF VALUE BASED CARE
MODELS
19
Bundles PCMH ACOs
-Only requires
pathway adherence
-Possibly single sign-on
sans pre-auth
Robs pharma revenue
-Systematic triage
-Patient Education
-Palliation
Robs hospital revenue
Requires tech
integration/APIs &
provider cooperation
Requires hospital
partnership

20. The Imperative – Match Costs with Revenue
TODAY

21. MULTIPLE INDUSTRY-WIDE VALUE-BASED
CARE REQUIREMENTS ARE HERE…
21
• Commercial payer programs are also growing:
• National plans: WellPoint, Aetna, Cigna
• Regional plans: Regence BCBS, Highmark BCBS, BCBS TN

22. Strategic Framework for Change (SWOT)
• Historical Strengths:
• Offering first rate cancer care and access to clinical trials
• Ability to know and support patients needs at the community level
• Access to economies in purchasing, contracting and billing
• Tremendous referral base with dedicated hospital partners
• Investment in Best-in-Class systems
• Appealing venue and practice for physician recruitment
• Capability to rapidly implement new products and services to respond to
market changes/opportunities
• Low cost provider – operates under Vanderbilt price umbrella
• Weaknesses:
• TN market dominated by local BCBS – limited bandwidth for payment
reform
• CON state limiting expansion in certain related service lines – radiation
therapy
• Locally dominant market share limits “in-market” growth
• Limited history of standard care practices across clinical sites

23. Strategic Framework for Change (SWOT)
• Opportunities:
– Implement Medical Home – position for future payment reform, control costs,
standardize practice
– Aggressive movement to expand economies of scale through related GPO
– New service lines, e.g. genetics lab
– Expand data use for improved care delivery – particularly pathways
– Numerous payment reform projects available through private payers and CMC/CMMI
• Threats:
– Ongoing Medicare fiscal woes and threat of very high priced new oncology drugs
– Ongoing 340 B and site of service advantage to local competition
– Ongoing drug shortages
– Locally dominant payer slow to move into Value Based reimbursement
– Payers moving to proprietary pathways systems – dramatically complicating care
delivery and billing

24. Changes to Survive/Thrive
• Done: Service Line Expansion
– Expanded Laboratory capability
– Specialty pharmacy for orals
– Led formation of Nationwide Oncology GPO (RainTree Oncology) 50+
practices, 500+ MDs
– Genetics Laboratory (Pending)
– Continued geographic growth (Chattanooga)
• Consider: Aggressive move to Oncology Patient Centered Medical
Home via NCQA accreditation as PCSP
– Adoption of Clinical Pathways
– Incorporation of Care Plans into practice, patient, referrals
– Development of Triage/Patient Management System
– Dramatic expansion of palliative care program including CMMI Grant
• Required with Medical Home: Negotiate changed payment systems
with Payers based on ACO or bundles model – if you can’t do this,
you will go broke!

25. Consideration: Do Oncology PCMHs Actually
Improve Care or Reduce Costs?
Evidence & Expert Opinion
• Costs Savings - Evidence
– Multi-year, 5 site study through UnitedHealthcare (1):
• All sites PCMHs (3 were members of COME HOME project & RainTree)
• Sites paid a fixed fee per patient – no mark-up on drugs
• Savings based on total cost of care – breast , colon & lung cancer
• Savings of 34% of expected costs ($34 million)
• Savings from hospitalizations and therapeutic radiology
– Movement to Pathways systems seems to offer 15% savings on Drugs
year 1, 6% additional year 2. (2)
– Come Home savings of $33.5 million based over 3 years and 7
practices – (percentage not given) (3)

26. Consideration: Do Oncology PCMHs Actually
Improve Care or Reduce Costs?
Evidence
• Quality – Evidence Positive for Oncology Medical Homes
– Reported Practice Results (4):
• ED visits reduced 68%
• Hospital Admissions reduced 51%
• Avg. LOS reduced 21%
• Out Patient visits cut by 22% for all hematology & oncology
• Savings of $11,955 per chemotherapy patient
• Quality – Mixed Reviews – Particularly Primary Care
– “Despite widespread enthusiasm for the medical home concept, few peer-reviewed
publications have found that transforming primary care practices into
medical homes (as defined by common recognition tools and in typical practice
settings) produces measurable improvements in the quality and efficiency of
care.” (5)

27. Consideration: Do Oncology PCMHs Actually
Improve Care or Reduce Costs?
Quality Evidence

28. RESULTS OF UNITED HEALTHCARE PAYMENT
REFORM PROJECT
28
3 years, 5 sites, 810 Patients, PCMHs
Result:
Predicted FFS cost = $98M
Actual cost = $64M
% savings = 34%
“There was no difference
between the groups on
multiple quality measures.”
Conclusion:
“Modifying the current fee-for-service payment system for cancer therapy
with feedback data and financial incentives that reward outcomes and cost
efficiency resulted in a significant total cost reduction.”
Newcomer LN. Changing Physician Incentives for Affordable, Quality Cancer
Care: Results of an Episode Payment Model. Doi:10.1200/JOP.2014.001488

29. UNITED HEALTHCARE COMPENSATION MODEL
“Medical oncologists
were paid a single fee, in
lieu of any drug margin,
to treat their patients.
Chemotherapy
medications were
reimbursed at the average
sales price, a proxy for
actual cost.”
29

30. Our Conclusions Regarding Oncology PCMH
• PCMHs seem to work quite well in reducing process variation
through the use of Pathways
– Pathways also can reduce drug costs from process variation – but this is
a year 1 & 2 opportunity
• PCMHs seem to work quite well in reducing total costs
through management of unnecessary hospital admissions and
ED use
– This is an obvious benefit to the patient – providing the right care, on
time and in the right venue
• Palliation offered through the PCMH is simply better for the
patient and better quality
• It is unclear which clinical outcomes measures are impacted by
oncology PCMHs

31. Medical Home Deliverable
Care Considerations
 Cancer care that is:
 Coordinated with the central focus on the patient and their
entire medical condition
 Optimized based on evidence-based medicine to produce quality
outcomes
 Accessible and efficient, with treatment provided in the highest
quality, lowest cost setting for the patient
 Delivered in a patient-centric, caring environment that
optimizes patient satisfaction
 Continuously improved by measuring and benchmarking results
against other facilities providing care so that best practices
“raise the bar” in delivering care
Institute of Medicine (IOM) report in 1999,
Ensuring Quality Cancer Care

32. Oncology Medical Home – Design
Considerations -We Match up Pretty Well
• Standardized evidence-based guidelines for prevention, diagnosis,
treatment, and palliative care - Pathways
• Measurement and continuous monitoring of a core set of quality
measures – NCQA PCSP Model
• Agreed upon care plan prepared by experienced professionals,
outlining the goals of care – Care Plans
• Access to clinical trials - SCRI
• Policies to ensure full disclosure to patients of information about
appropriate treatment options – Care Plans, PCSP
• Mechanisms to coordinate services – Patient Management
• Quality care at the end of life - Palliation
• Policies to address the barriers to receiving appropriate cancer care
in specific segments of the population – PCSP, Internal Policies
Institute of Medicine (IOM) report in
1999, Ensuring Quality Cancer Care

33. Medical Home Accreditation

34. Other Programs Evaluated in Our Planning
Source: The Advisory Board

35. Sites of Focused Study
• Consultants in Medical Oncology and Hematology, Drexel PA
– Level 3 PCSP, led by Dr. John Sprandio
– Pioneers in Oncology Medical Home, constant focus on patient
engagement and best practice adherence
– Proprietary EMR and patient management software
– Focused first on Triage, then pro-active patient management
– Self Funded Medical Home Development
• New Mexico Cancer Center
– CoC certified, led by Dr. Barbara L. McAneny
– Founder of COME HOME Project, $19.8 million CMMI Grant
– Includes 7 practices, and proprietary Pathways and Patient
Management software

36. Consultants in Medical Oncology and
Hematology: Summary Facts

37. Consultants in Medical Oncology and
Hematology: Methods

38. New Mexico Cancer Center & COME HOME

39. New Mexico Cancer Center & COME HOME -
Methods
• Practice Size 10-15 providers – 7 practices
• Large emphasis on IP/IT development
• Special emphasis on Triage – with proprietary
system
• Includes Saturday clinic and “after hours”
• Multiple layers of patient support
• Some practices focused on patient acuity
scoring

40. Our Distillation: 4 Pillars of our Medical Home
• Pathways: NCCN compliant Pathways are the base level
requirement for our PCMH, Rx, Genetics and Diagnostic imaging
– Have to be:
• Rigorously and systematically maintained
• Independent of any payer organization
• Cloud based
• Linked to our Aria EMR
• Capable of practice level customization
• Capable of producing supportive care pathways as well
• Capable of easily dealing with our clinical trial volume
• Capable of producing Care Plans
– Key metrics: 90% Attribution, 80% Compliance

41. Pathway System Selection Process
• All Major commercial systems evaluated
– Via Oncology: Not payer or GPO affiliated, excellent clinical content &
systems, good patient materials & palliation
– P4: Associated with Cardinal and various payer organizations, good
clinical content, limited integration with our system
– Eviti: Multiple payer customers nationwide, Express Scripts, limited
system integration
– Clear Value Plus: McKesson product, excellent integration, NCCN
affiliation, strong competitor
– Flat Iron: Juvenile stage pathway product, Altos EMR tie in, takes all
practice data for sale to pharma
Via and Clear Value were our 1&2 –We went with Via

42. Impact of Pathways on Compliance
Aetna Study

43. Current Pathway Utilization

44. Via Oncology System - Interface

45. Via Oncology System - Interface

46. Care Plans
• Care plans: A documented account of care shared with the Patient, Payer
and other Providers at transition of care. Form a fundamental information
tool with:
– Payers:
• Care plans form the basis for attribution and compliance metrics
• All payer expectations are driven by care plans and subsequent reports/audits
• Flexibility in plan design important
– Patients:
• Plans for the fundamental curriculum around which patient education takes place
• Plans form the basis for subsequent patient management
– Referrals:
• Plans are the fundamental information tool for MU compliance
• Plans facilitate continuity of care
• Key Metric: Shared with the Patient, Payer and other Providers at 90% of
transitions of care, includes all care provided by the practice and additional
elements as mandated by Meaningful Use.

47. Pathway System Addresses Phase 1 Care Plan
Requirement

48. Patient Management
• Reactive (triage) and proactive management of disease between office
visits; systematic response to patient concerns, including non-oncology.
Goals: Improved patient care; improved outcomes; reduced cost; increased
adherence to care plans. Compliance
• Key considerations:
– Must offer triage first, then proactive patient management
– Must integrate with phone and data management systems
– Triage must conform with best practices, and integrate smoothly with scheduling
– Must include multi-modal including phone, text, email
– Must support development of supportive care pathways with automatic notifications and
work lists
– Must integrate with Pharmacy
• This is a team sport – must include all members of the care team
• Key Metric: Control 90% of ED and hospital use

49. Patient Management - System Use Cases
• Provider
– Triage: Safe, timely intuitive triage
– Patient management: Supportive care based on predictive pathways
– Risk analysis based on clinical data
– Frequent periodic patient status/distress reporting
• Payer
– Timely reports on: triage, status variation, pathway adjustment
• Patient
– Meaningful and timely educational materials
– Direct access to supportive care
– Meaningful information regarding status

50. Triage/Engagement Considerations
Telephonic Triage is a requirement for “Stage 1” Medical
Home Development
Triage Has three fundamental components
 1) Patient engagement and symptom/situation description
 2) Tier the patients condition based on objective criteria, reflecting
symptoms, history and risk
 3) Direct the patient to the most appropriate medical care
Triage frequently means late stage correction of a problem -
anticipation, training, education should eliminate most triage
Triage system needs to be built to accommodate:
 1) Broader patient engagement requirements – e.g. status reporting
 2) Prospective tiering and planning based on treatment and status
 3) Demographic data inputs from EMR

51. Validated Tools
Edmonton Symptom Assessment System: Edmonton
Zone Palliative Care Program: http://www.palliative.org/tools.html

52. Validated Tools
Ontario Cancer Symptom Management:
https://smg.cancercare.on.ca/

53. Validated Tools
Telephone Triage Protocols for Nurses, Briggs: This is
the standard reference in the US. Ideally, we would be
able to include in an electronic format.
 3 Tier Protocols
 Not Optimized to Cancer
 Consulting support seems available via Ms. Briggs
Emergency Nursing 5-Tier Triage Protocols (also by Ms. Briggs)
 Optimized for emergency use
 Probably more complicated than needed
Telephone Triage for Oncology Nurses, Hickey & Newton:
 Optimized for Oncology
 Triage protocols are a mix of oncology and other
 Needs consistency and standardization

54. System Design & Considerations
 System built on hosted cloud platform – must be HIPAA compliant
 Built around relational data base – tables built from validated sources
 Tiering and work-listing for call return & patient response
 Maintains and reports real-time on functionality data for system
 Integrates with and captures phone system data
 Role & Permission based for access and input
 Receives ADT feeds for demographic information from demographic master
system
 Uses standardized and validated patient symptom ranking and distress scoring
 Build done in iterative phases:
 First – Triage
 Second – Patient status reporting (used for outcomes, risk, standardized check-in)
 Third – Patient risk/acuity scoring with work-listed outreach requirements
 Fourth – Incoming partner data feeds & Date Warehouse
 Fifth – Learning system: first focused on actual vs expected, “gamified” to patient

55. Patient Management – Predictive Analytics
• Initial Objective – Risk for Hospitalization
• Key design consideration – based on clinical (EMR)
rather than payer data
• Must be based on experience in medical oncology –
general system not relevant for our needs
• Depends on data partnerships with referral hospitals
• Evaluated 15-20 systems
• Chose Clinicast – group spun out of Kaiser

56. Palliation
• Integral part of patient management – we use for all
patients (certain clinics), beginning with the first visit
• Difficult to justify at the practice level outside of
Value Based Care payment model
• Moving to patient resources from the pathways
system
• Really depends on good patient management tools
• We applied to participate in the CMMI new palliation
model with a local hospice

57. 57
THE FOUR FUNDAMENTALS OF A VALUE-BASED
CANCER SOLUTION
4. Palliation -- always relevant throughout the patient’s course of treatment
• Alive Hospice / Tennessee Oncology Partnership
• Applied for Medicare Care Choices grant, allows for simultaneous curative
and palliative care by a non-profit hospice
• Pain management
• Establishment of patient-driven treatment goals

58. 58
IN-PATIENT CONTINUES TO DOMINATE EOL COSTS
Mean OP chemo cost Mean OP service cost Mean hospice cost Mean IP cost
$7,834
$9,230
$10,051 $10,362
$11,469
$25,261
$30,000
$25,000
$20,000
$15,000
$10,000
$5,000
$0
6th MBD 5th MBD 4th MBD 3rd MBD 2nd MBD Last MBD
Commercial Patients, Mean $/month
N = 28,530

59. IT System Before Value Based Care

60. IT System After Value Based Care

61. The Alternative to Physician Directed Value Based
Care – Aggressive Expansion by PA Companies
PA Company Planning documents

62. The Alternative to Physician Directed Value Based
Care – Aggressive Expansion by PA Companies
PA Company Planning documents

63. The Alternative to Physician Directed Value Based
Care – Aggressive Expansion by PA Companies
PA Company Planning documents

64. VALUE-BASED PERFORMANCE
SUMMARY OF KEY CONCEPTS AT
TENNESSEE ONCOLOGY
 Best care practices  transparency, adherence, and auditability
 Patient-Centered Care = Value Delivery
Communication of expected outcomes and risks
 Communication of costs to patient
Empower patients and families to make informed choices
 Respect of patients’ decisions and resources
 Value delivery achieved through a certified patient-centered
medical home
 4 pillars: (1) Pathways; (2) Care plans; (3) Patient
management; (4) Palliation
64

65. Citations
1. Newcomer LN et al: Changing Physician Incentives: An Episode Payment Model. JOP.ASCO. July 14,2014, Published ahead
of Print.
2. Feinberg B et al. Third-Party Validation of Observed Savings From an Oncology Pathways Program. American Journal of
Managed Care. Volume 19, Special Issue 4. May/June 2013
3. Oncology Business News, August 2014
4. DOI: 10.1200/jop.2014.001386; published ahead of print at jop.ascopubs.org on March 11,2014.
5. Friedberg MW, Schneider EC, Rosenthal MB, Volpp KG, Werner RM. Association Between Participation in a Multipayer
Medical Home Intervention and Changes in Quality, Utilization, and Costs of Care. JAMA. 2014;311(8):815-825.
doi:10.1001/jama.2014.353.