Financial impact of an oncology medical home on participating providers.

Abstract

e17581 Background: CareFirst BlueCross BlueShield (CFBCBS) partnered with Cardinal Health Specialty Solutions (CHSS) to launch the first cancer care clinical pathway in the United States in August 2008. Due to early success of the program with regard to savings and physician participation and compliance, CFBCBS and CHSS piloted an oncology medical home program in January 2011 with the hope of further decreasing cancer care costs while continuing consistency and quality of patient care. The medical home program offered a new physician reimbursement model that shifted the source of revenue from margin on drug sales to cognitive services. This would allow physicians to focus on optimal patient care without the financial incentive to prescribe chemotherapy. We analyzed the financial impact of the medical home program on participating physicians 1 year after implementation. Methods: Intravenous drug codes plus the evaluation and management codes for patient visits and chemotherapy administration were used in the analysis. We analyzed amounts paid to participating practices for chemotherapy, supportive care treatments, and nondrug services for year +1 to the amounts paid for the same services for year -1. We also analyzed the medical home fee schedule for year +1 when compared to the first-generation fee schedule applied to program year +1 utilization. This was calculated by repricing year +1 claims to the first-generation fee schedule and comparing that cost to what was actually paid under the medical home fee schedule. Results: Fourteen practices (31 physicians, 478 patients) joined the medical home program. Average amounts paid to physicians were 4.7% higher for year +1 compared to the prior year. The average cost difference for year +1 based on the medical home fee schedule versus the first-generation fee schedule was -5.7%. If physicians had chosen not to join the medical home program their revenues would have increased by 11%. Conclusions: Drug cost inflation was a significant contribution to savings in this model and directly impacts the observed lower average reimbursement to medical home participants versus their pathway program peers. Providers are likely to seek remedies for continued participation.