What Oncology Bundled Payments Will Look Like

Posted by Cam McClellan Teems

September 12, 2017 at 1:00 PM


Value-based payment models continue to gain traction across specialties, leading many to wonder what shape they will take in oncology. Experts seem to think that they might look at lot like episode-specific payments. Lindsay Conway, managing director at the Advisory Board, thinks that the University of Texas MD Anderson Cancer Center’s pilot with UnitedHealthcare sets a good example for bundles in cancer.

“Best of all, the patient receives just one bill for all of the care—surgery, radiation, chemo, or anything else—that they receive across the course of a year. I love this because it’s high quality, it’s efficient, and it is patient-centered in a way that we haven’t seen from other models.”

Conducted at MD Anderson’s Institute for Cancer Care Innovation, the three-year pilot is wrapping up this year. It involved 88 patients with head and neck cancers. UnitedHealthcare made a single annual payment to MD Anderson for all inpatient and outpatient care provided to a patient.

UnitedHealthcare has conducted and expanded another episode-payment initiative limited to medical oncologists. That program – which initially ran from 2009 to 2012 – also appears to hold promise. Five community oncology practices were paid a single fee, in lieu of any drug margin, to treat their patients with breast cancer and colon cancer. The pilot reduced the total cost of care for those patients by more than a third. Five other oncology practices have joined UnitedHealthcare’s episode program, which now includes more than 650 oncologists.

Horizon Blue Cross Blue Shield of New Jersey started a pilot in late 2014 with Regional Cancer Care Associates, a multi-state practice based in New Jersey. Using standard fee-for-service reimbursement during the patient’s treatment, the care episode and treatment outcomes are reviewed to determine whether quality metrics were met and if expenditures were less than projected. If so, providers shared the savings.

The thing about episode bundles that everyone knows what they are getting up front: the patient understands the costs and the provider understands the revenue. Episodes of oncology care would become more predictable, which would be a very good thing for both oncologists and payers in the highly unpredictable realm of cancer care.


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Topics: oncology, Bundled Payments

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