The results of a study published in the July issue of the Journal of Oncology Practice explored an interesting strategy to lower the cost of cancer treatment, which, as this blog has previously addressed, has become a major concern for thousands of Americans sufferers.
Last year, the U.S. spent approximately $37 billion on cancer drugs, more than any other category, according to IMS Institute for Healthcare Informatics. The recent study, which involved five distinct oncology practices, experimented with a new billing and payment strategy that lowered the cost of care by approximately 34 percent.
The study offered participating providers a single upfront payment for the patient's entire episode of care, instead of the usual pay-per-visit model. They did however continue "fee-for-service" payments, such as diagnostic tests, throughout the course of treatment.
The study was designed to avoid financially awarding physicians for prescribing more expensive treatments, for which providers would see greater reimbursements. Finally, all of those involved with a patients treatment plan would meet regularly to discuss strategy, and what they had learned about cost and quality.
Researchers found that much of the 34 percent savings came from the provider's ability to share insight and work directly with one another, according to Lee Schwartzberg, the chief of oncology at West Clinic, a participating provider in Memphis.
Also, the study found that the revamped compensation model did not reduce the cost of the drugs used. Surprisingly, spending on drugs increased significantly, by 179 percent.
"Despite the additional $13 million for chemotherapy drugs," the study said, "the total medical costs were reduced by $33 million."
The study, while an important step in understanding what drives the cost of oncological care, may not have a significant effect on treatment costs until adopted by major insurance providers. Until that time, if your facility is facing difficulty with medical claims management, consider outsourcing your medical accounts receivable to Professional Medical Services to increase cash flow.