The Movement to Value-Based Care

Today’s delivery system is being reorganized around value

Over the last decade, payers have faced ever-growing oncology costs, independent practices have been replaced by mega-groups and facilities, and patients have been challenged by a fragmented delivery system and less than optimal outcomes. A series of solutions emerged to solve these challenges:

Movement toward value-based care

Utilization Management – Oncology solutions have evolved as well. Beginning in 2003, utilization management became the model to manage over-utilization of services and drugs. Complex case management solutions appeared to help patients navigate a convoluted system and prevent avoidable admissions.

Affordable Care Act– The Affordable Care Act changed the momentum again; especially as new specialty drugs began to drive unprecedented trend in oncology spend.  With cancer as a leading expense, payers struggled with the shortcomings of utilization and case management to control escalating costs.

Pathways – Around 2010, “Pathways” companies emerged as a more enlightened way of containing costs by promoting evidence-based decision-making.  Pathways could embrace education-based programs, rigorous prior-authorization, clinical guideline compliance and more.  After several pilots, Pathways proved to be inadequate for solving the cost and quality challenges facing oncology – especially without provider buy-in.

ACO –In 2014, several payers began to experiment with ‘value-based’ models of oncology care. UnitedHealthcare introduced a bundled payment pilot and Florida Blue, Baptist, and Moffitt Cancer Center promoted an ACO approach. Shared risk formed the key to the value-based approach in contrast to the “permission gate” of utilization management.

Oncology Care Model – In June 2015, CMS started accepting applications for the Oncology Care Model (OCM), which represents an important major step toward value-based oncology care. OCM uses a shared savings model that promotes both cost efficiency and quality of care, and can transform the delivery system to a patient-centered, economically viable model. Over 400 practices submitted Letters of Intent as did the industry’s major private payers in the country. This broad interest shows a strong commitment to value-based oncology care.

Those selected to participate in the Oncology Care Model have much to learn from the primary care ACO’s that have pursued a value-based approach.  Infrastructure investment (technical and operational) and committed management are key to its success. Additionally, practices need expert partners, because value-based oncology is very different from the traditional fee-for-service practice.

The value-based era is here and now.  Faced with the next-generation challenges of escalating drug cost and personalized medicine, today’s delivery system foundation must be reorganized around value.


Achieve Measurable Results

In a recent case study, ORN improved an oncology practice’s performance by 91 percent in 90 days, representing $23,000 per million members per month, or a savings potential of $3.5M across a network of providers serving 50K Medicare Advantage and Commercial lives.

Read the study

Make the move to value-based care.

Contact Oncology Resource Networks