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Dawn Holcombe DGH Consulting March 2013 4/3/13 DGH Consulting - CONFIDENTIAL 1

DawnHolcombe DGHConsulting% March2013%communityoncology.org/pdfs/holcombe COA March 2013... · Payer’–DistribuGon’Channels’to’Physician’Offices’ Billing Process 2011Average

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Page 1: DawnHolcombe DGHConsulting% March2013%communityoncology.org/pdfs/holcombe COA March 2013... · Payer’–DistribuGon’Channels’to’Physician’Offices’ Billing Process 2011Average

Dawn  Holcombe  DGH  Consulting  

March  2013  

4/3/13 DGH Consulting - CONFIDENTIAL 1

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Changing  Landscape  � Majority  of  oncology  drugs  still  delivered  in  oncology  offices  and  acquired  through  buy  and  bill  

� Growing  Pressures:  A.  Frequency  of  oral  drugs  in  oncology  pipeline  B.  Financial  pressures  changing  delivery  models  –  will  

hospitals  dispense?  C.  The  Feds  –  will  sequestration  or  push  to  ACO’s  change  

drug  acquisition  trends  overnight?  D.  Specialty  Pharmacy  and  other  vendors  building  in  

oncology  management  and  delivery  space  

4/3/13 DGH Consulting - CONFIDENTIAL 2

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A.    Oral  Drugs  in  Oncology  Pipeline  � Driving  Forces  

�  REMS  dictated  in  FDA  approvals  �  Limited  distribution  networks  raise  challenges  to  providers  –  forced  vendor  expansion  outside  of  historical  

�  Adherence  –  more  difficult  to  control  out  of  office  –  patient’s  responsibility  

�  Costs  and  vendors  fueling  payer/employer  concerns  � Medicare  Advantage  issues  for  patients  and  providers  � Oral  perceived  as  more  manageable  and  less  costly  (away  from  providers)  

4/3/13 DGH Consulting - CONFIDENTIAL 3

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B.    Changing  Delivery  Models  � How  will  providers  react  to  pressures?  

�  Follow  mandates  for  “Ship  for  Script”  vs  “Buy  and  Bill”?  �  Choose  to  replace  acquisition  with  delivery  for  financial  reasons?  

�  Shift  patients  to  hospitals  (acquisition  or  shifts)  � What  choices  will  hospitals  make?    Will  payers  mandate  for  hospitals  as  well?      

� Will  hospitals  then:  �  Follow  mandates  �  Replace  acquisition  with  delivery  �  Where  would  they  shift  patients?  (????Medicare?????)  

4/3/13 DGH Consulting - CONFIDENTIAL 4

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C.    WWCD?  What  will  CMS  do?  �  Sequestration  –  depth,  duration  and  application  of  cuts  

� ACOs  –  not  yet  oncology,  but  around  corner    � Bundled  outpatient  services  –  like  DRGs  in  hospitals  

�  Cross  many  specialties,  providers  and  services  for  one  diagnosis  

�  Force  MDs  into  bundles?  

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D.    External  Vendors  in  Oncology  � Oncology  Management  (medical  and  pharmacy)  

�  CVS  Caremark  �  ExpressScripts  � Walgreens  �  ICORE  

�  And  more  

4/3/13 DGH Consulting - CONFIDENTIAL 6

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4/3/13 DGH Consulting - CONFIDENTIAL 7

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Opportunity  for  Specialty  Pharmacy  �  “…many…issues  can  be  attributed  to  lack  of  provider  control  and  monitoring  of  treatment  due  to  decreased  visibility—particularly  compared  with  intravenously  administered  chemotherapy—and  suggests  that  patients  require  more  guidance.”  �   Patents  misunderstand  directions  for  medication  �  Adverse  reactions  may  lead  to  stopped  or  reduced  useage  

� Under  or  over  adherence  (waste  or  inappropriate  care)  � Drug  interactions  

4/3/13 DGH Consulting - CONFIDENTIAL 8

“Walgreens Specialty Pharmacy's Oral Oncology Management Program” by Richard Miller, Specialty Pharmacy Times, published online May 29, 2012, http://www.specialtypharmacytimes.com/publications/specialty-pharmacy-times/2012/june-2012/Walgreens-Specialty-Pharmacys-Oral-Oncology-Management-Program

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Services  Available  from  Specialty  Pharmacy  �  Typically  

�  NCCN  Guidelines  or  Compendia  compliance  �  External  advisory  boards  �  Patient  assessment,  counseling  and  education  �  Clinical  side  effect  management  and  support  (often  billed  as  early  intervention  and  management)  

�  Patient  financial  support  and  assistance  program  coordination  

�  Medication  oversight  (including  complimentary  and  other  disease  medications)  

�  Cost  management  (hospitalization  avoidance,  limited  fill  terms)  

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Reports  for  Payers  from  ICORE  and  ExpressScripts    2012  ICORE  Medical  Pharmacy  &  Oncology  Trend  Report™    Express  Scripts  2011  Specialty  Drug  Trend  Report  

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TherapeuGc  Classes  with  a  Medical  Formulary  Currently  in  Place  

99%  

89%  

77%  

76%  

64%  

57%  

99%  

97%  

97%  

96%  

100%  

97%  

0%   20%   40%   60%   80%   100%  

ESA  

IVIG  

CINV  

G-­‐CSF  

Biologic  Response  Modifiers  

Chemotherapy  

2013  

2012  

4/3/13 DGH Consulting - CONFIDENTIAL 11

2012 ICORE Medical Pharmacy & Oncology Trend Report™, http://www.icorehealthcare.com/media/329731/2012_trend_report.pdf , Figure 3 Page 9

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Payer  Reimbursement  Trends  � About  6  of  10  covered  lives  are  covered  by  plans  that  reimburse  providers  for  medical  benefit  injectables  at  a  %  higher  than  the  average  sales  price  (ASP)  

� The  reported  weighted  mean  percentage  higher  than  ASP  in  2012  was  18%,  up  from  11  %  in  2011.  

�  payors  who  represent  53%  of  covered  lives  in  2012  have  begun  to  explore  pilot  programs  that  look  at  bundled  payments  for  services  with  large,  in-­‐network  oncology  groups  9up  form  36%  in  2011)  

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2012 ICORE Medical Pharmacy & Oncology Trend Report™, http://www.icorehealthcare.com/media/329731/2012_trend_report.pdf , Pages 12-13, 15

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Growth  of  Oral  Parity  

42   44   46   48   50   52   54   56  

Yes,  have  member  parity  

No,  no  member  parity  

2012  

2011  

4/3/13 DGH Consulting - CONFIDENTIAL 13

2012 ICORE Medical Pharmacy & Oncology Trend Report™, http://www.icorehealthcare.com/media/329731/2012_trend_report.pdf , Fig. 27 Page 21

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Medical  Injectables  Billing  DistribuGon  -­‐  Payers  

0%  

10%  

20%  

30%  

40%  

50%  

60%  

Physician  Office  

Outpatient     Home  Infusion  

Inpatient   Pharmacy  Benefit  

2010  

2011  

2012  

4/3/13 DGH Consulting - CONFIDENTIAL 14

2012 ICORE Medical Pharmacy & Oncology Trend Report™, http://www.icorehealthcare.com/media/329731/2012_trend_report.pdf ,Figure 38 Page 26

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Payer  –  DistribuGon  Channels  to  Physician  Offices  Billing  Process  

2011  Average  Weighted  Volume  Infused  Chemo  Drugs  

2011  Average  Weighted  Volume  Infused  NON  Chemo  Drugs  

2012  Average  Weighted  Volume  Infused  Chemo  Drugs  

2012  Average  Weighted  Volume  Infused  NON  Chemo  Drugs  

MD  Buy  and  Bill  

64%   38%   60%   36%  

Specialty  Pharmacy  (White  Bag)  

25%   44%   32%   51%  

Patient  (Brown  Bag)  

5%   11%   1%   1%  

Other   6%   7%   6%   10%  

4/3/13 DGH Consulting - CONFIDENTIAL 15

2012 ICORE Medical Pharmacy & Oncology Trend Report™, http://www.icorehealthcare.com/media/329731/2012_trend_report.pdf ,Figure 39 Page 27

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Differences  for  Payers  from  Drug  Delivery  Models  �  Specialty  pharmacy  acquisition  costs  are  17  percent  higher  on  a  weighted  average  basis  than  in  the  provider’s  office.    

�  Approximately  20  percent  of  drugs  shipped  to  a  provider’s  office  fail  to  be  used  due  to,  for  example,  changes  in  dose,  therapy,  duration  of  therapy,  benefit  changes  or  enrollment  in  palliative  care  programs.    

�  Higher  claim  cost  can  occur  as  partial-­‐vial  use  is  not  possible  when  billing  the  11-­‐digit  National  Drug  Codes  (NDCs)  used  by  specialty  pharmacies.  

4/3/13 DGH Consulting - CONFIDENTIAL 16

2012 ICORE Medical Pharmacy & Oncology Trend Report™, http://www.icorehealthcare.com/media/329731/2012_trend_report.pdf ,Page 27

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Management  Tools  for  Common  Therapies  by  Percent  of  Lives  

Prio  Auth  

Dis  Mgmt  

Edits  –  Step,  Req  

Clin  Paths,  Gdlns  

Case  Mgmt  

Diff  Reimb  

Fail  Generic  1st  

NCCN  Gdlns  

Formularies  

None  

IVIG   83%   53%   37%   15%   38%   9%   8%   50%   46%   0%  

Chemo   82%   67%   57%   17%   39%   22%   8%   84%   11%   8%  

ESA   81%   50%   44%   18%   35%   11%   8%   56%   47%   1%  

G-­‐CSF   79%   63%   44%   17%   34%   9%   8%   55%   11%   3%  

Biol  Rsp  Mdfr  

94%   64%   57%   18%   35%   51%   12%   49%   51%   1%  

CINV   31%   64%   44%   16%   38%   46%   13%   56%   13%   11%  

4/3/13 DGH Consulting - CONFIDENTIAL 17

2012 ICORE Medical Pharmacy & Oncology Trend Report™, http://www.icorehealthcare.com/media/329731/2012_trend_report.pdf ,Figure 44,Page 30

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Pharmacy  and  Medical  Benefits  Drug  Spend  –  Express  Scripts  2011  Specialty  Drug  Trend  Report  

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Express  Scripts  SBS  Medical  Benefit  Management  Express  Scripts  2011  Specialty  Drug  Trend  Report  Care  Continuum™  —  an  Express  Scripts  Subsidiary  —  provides  the  industry's  most  comprehensive  range  of  utilization,  trend  and  claims  management  tools  for  controlling  the  cost  of  medically  billed  drugs.  With  more  than  15  years  of  experience  and  URAC  accredited,  Care  Continuum  is  supported  by  a  staff  of  clinicians,  medical  professionals  and  a  board-­‐certified  medical  director.    To  achieve  savings  on  medically  billed  specialty  drugs,  we  apply  three  management  principles:  �       �  Utilization  Management  Ensuring  the  safe  and  appropriate  use  of  high-­‐cost  specialty  drugs    �  Site  of  Care  Management  Redirecting  patients  and  medications  to  the  lowest-­‐cost  and  most  appropriate  channel

   �  Reimbursement  Management  Verifying  claims  are  paid  at  the  contracted  rate  and  improving  opportunities  to  achieve  

rebates          

�  Physicians:  Streamlining  Administrative  Processing  Our  administrative  processes  and  online  systems  are  designed  to  give  healthcare  providers  easy  to  use  tools.  If  you  are  not  using  the  online  tool  yet,  we've  provided  fax  forms  for  you  to  use  instead.  

�  Patients:  Safeguarding  Care  Our  utilization  management  oversight  ensures  patients  receive  safe  and  appropriate  clinical  care.  

�  Plan  Sponsors:  Guaranteed  Savings  We  deliver  significant  savings  to  plan  sponsors,  backed    by  a  guarantee.  

�  Online  Prior  Authorization      For  healthcare  providers,  our  services  include  real-­‐time  PA  approvals  available  through  easy,  online  access.  Get  timely,  accurate  authorizations.  No  more  faxing.  

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Express  Scripts  SBS  Pharmacy  Benefit  Management  -­‐  Express  Scripts  2011  Specialty  Drug  Trend  Report  �  For  more  than  25  years,  Express  Scripts  has  been  a  leader  in  trend  and  

utilization  management  of  drugs  billed  through  the  pharmacy  benefit.  As  the  first  to  publish  a  drug  trend  report  and  the  first  to  hold  an  Outcomes  conference  for  plan  sponsors,  Express  Scripts  is  an  innovative  leader  in  the  industry.  To  continue  this  legacy,  we  apply  the  latest  specialty  pharmacy  benefit  management  tools  to  reduce  the  spend  and  trend  of  specialty  drugs  billed  through  the  pharmacy  benefit.  

�  Our  clinical  experts  designed  the  following  programs  to  eliminate  waste:  

�  Utilization  management  •  Prior  Authorization  �  •  Drug  Quantity  Management  �  •  Specialty  Step  Management  �  •  Clinical  Guidance*    �  Plan  design  •  Tier  Copayments  �  •  Network  Design  �  •  Zero  Retail  Fills  �  •  Drug  List  Recommendations    

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Information  generated  by  payer  organization  to  ask  and  answer  questions  for  medical  directors  of  payers  and  employers  related  to  oncology  delivery  models  –  Published  in  Journal  of  Managed  Care  Medicine  –  November  2012    

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NAMCP  Drug  Delivery  Impact  Study  � NAMCP    

� DGH  Consulting  

�  onPoint  Oncology  

�  ImproveRX,  Inc,  

�  Sanofi  Aventis  

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Purpose  of  Study  � Drug  Delivery  Models  in  Flux    

� Potential  Changing  Drug  Delivery  Models  Cost  Implications  for  Payers    

�  Impact  is  based  upon  delivery-­‐related  costs  of  drug  cost  only  

� Regulatory  Impact  on  Drug  Management  and  Costs    

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Study  Focus  �  Direct  Acquisition  Model  (Buy  and  Bill)  

�  External  Delivered  Model  (Script  for  Ship)  

�  Estimated  Impact  of  Cancer  Treatment  Variation  from  Original  Prescription  under  the  two  different  drug  delivery  models    

�  Calculation  of  Impact  –  “Potential  Waste”    

�  Study  projects  Potential  “Waste”,  if  delivery  model  were  to  change,  not  actual  current  magnitude  of  “waste”    

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Safe  Handling  Guidelines  for  Chemotherapy  Administra8on    ASCO/ONS  Standards  for  Safe  Chemotherapy  Administration  establish  that    

�  22.  On  each  clinical  visit  or  day  of  treatment  during  chemotherapy  administration,  staff:  

�  Assess  and  document  clinical  status  and/or  performance  status  �  Document  vital  signs  and  weight  �  Verify  allergies,  previous  reactions,  and  treatment-­‐related  toxicities  �  Assess  and  document  psychosocial  concerns  and  need  for  support;  taking  

action  when  indicated.  �  This  standard  applies  to  all  clinical  encounters  (including  each  inpatient  day,  

practitioner  visits  and  chemotherapy  administration  visits,  but  not  laboratory  or  administrative  visits).    

�  23.  At  each  clinical  visit  or  day  of  treatment  during  chemotherapy  administration,  staff  review  the  patient’s  current  medications  including  over  the  counter  medications  and  complementary  and  alternative  therapies.  Any  changes  in  the  patient’s  medications  are  reviewed  and  documented  by  a  practitioner  during  the  same  visit.  

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Key  findings  �  About  1  in  10  cancer  treatments  have  variations  in  treatment  between  

the  original  planned  dosing  and  the  actual  day  of  treatment  for  the  most  common  cancers:    breast,  lung,  colon  and  prostate  

�  Over  90%  of  those  variations  in  treatment  result  in  the  planned  dose  not  being  given  on  the  day  of  treatment  

�  The  rest  of  the  variations  result  from  dose  increases  or  dose  decreases  �  If  drugs  are  pulled  on  the  day  of  treatment  from  a  general  inventory  

maintained  by  the  cancer  provider  (Direct  Acquisition  Model),  only  those  drugs  which  are  actually  used  are  billed  to  the  health  plan  by  the  cancer  provider,  so  no  waste  of  drug  in  comparison  to  the  original  prescription  occurs.  

�  If  drugs  are  delivered  to  the  cancer  practice  for  administration  based  upon  the  original  planned  prescription  by  the  cancer  provider  (External  Delivered  Model),  they  are  billed  out  to  the  health  plan  by  the  external  vendor  upon  shipment,  not  upon  actual  utilization  for  the  patient    

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Key  Findings  –  cont.  �  If  drugs  are  delivered  from  an  external  vendor  to  the  cancer  practice  for  a  

specific  patient  under  the  planned  prescription  and  are  not  used  for  that  patient  –  those  drugs  cannot  be  used  for  another  patient,  nor  returned….they  must  be  handled  as  “waste”  and  discarded  by  the  cancer  provider,  resulting  in  a  cost  to  both  the  health  plan  and  the  provider,  in  addition  to  the  cost  of  the  drugs  actually  used  for  treatment  of  the  cancer  patient.  

�  Based  upon  the  results  of  this  study,  on  a  conservative  basis,  the  cost  of  such  potential  “waste”  to  the  health  plan  (in  addition  to  the  drugs  actually  used  for  treatment)  under  a  External  Delivered  Model,  could  reach  about  $5,000  per  treating  physician,  and  are  possibly  significantly  higher  under  less  conservative  assumptions.  

�  There  is  a  potential  high  impact  of  “waste”  dollars  in  drug  use  even  resulting  from  low  (under  10%)  variations  resulting  from  same  day  treatment  changes  –  for  both  chemotherapy  drugs  and  ancillary  drugs  that  are  delivered  to  the  cancer  provider  for  use,  but  that  “waste”  does  not  occur  when  cancer  drugs  are  used  from  within  the  cancer  provider’s  own  acquired  inventory.  

�  Drug  shortages  are  a  significant  issue  in  oncology  today,  and  delivery  policies  that  cause  large  numbers  of  unused  drug  to  be  destroyed  would  only  exacerbate  cancer  drug  shortages.  

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Methodology  �  Data  set  derived  from  electronic  medical  records  (OncoEMR,®  Altos  Solutions,  Pleasanton,  CA  and  OnPoint  Oncology,  LLC,  Hudson,  OH)    �  de-­‐identified  patient  information  such  as  dose,  duration,  sequence  

and  key  patient  demographic  data  including  diagnoses.    �  originally  ordered  treatment  plan  including  the  anticipated  drug  

and  dose  was  well  as  the  drug  and  dose  actually  administered  to  the  patient  on  the  day  of  treatment    

�  Mismatches  between  the  ordered  drug  and  dose  and  the  administered  drug  and  dose  provided  the  basis  for  comparisons  of  the  two  drug  delivery  models.  

�  12-­‐month  period  of  April  1,  2011  through  March  31,  201    

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Methodology  –  cont.  �  Three  different  scenarios  when  a  mismatch  between  ordered  amount  and  

administered  amount  occurred:      �  ordered>administered,  including  situations  where  administered  amount  =  0  

(ordered  dose  held);    �  ordered<administered;  and    �  ordered=administered.    

�  primary  outcome  measure  was  the  mean  cost  difference  between  ordered  drug  amounts  and  administered  drug  amounts  ,when  ordered  was  greater  than  administered.    

�  Under  a  delivered  drugs  model,  drug  is  pre-­‐ordered  by  the  physician  practice  from  an  external  source  (i.e.  specialty  pharmacy)  and  can’t  be  returned  if  unused  (ordered>administered).  This  was  considered  as  potential  ‘waste’.    

�  Thirty-­‐day  per  patient  drug  waste  was  also  calculated  based  on  the  observed  utilization  patterns  for  both  Average  Wholesale  Price  (AWP)-­‐17%  and  Average  Selling  Price  (ASP)  +  10%  and  normalized  to  mean  time  on  drug  (in  days,  first  to  last).  

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PaGents  in  Dataset  

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Breast,  540,  41%  

Lung,  394,  30%  

Colon,  269,  20%  

Prostate,  119,  9%  

PaGents  in  Dataset  4/1/11  -­‐  3/31/12,  1,368  total  

Breast  

Lung  

Colon  

Prostate  

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Doses  in  Dataset  

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Breast,    7,892  ,  31%  

Lung,    8,557  ,  34%  

Colon,    7,857  ,  31%  

Prostate,  896,  4%  

Doses  in  Dataset  4/1/11  -­‐  3/31/12,  25,202  total  

Breast  

Lung  

Colon  

Prostate  

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Study  LimitaGons  �  Such  variations  uncounted  in  this  study  could  include:  

�  Complete  changes  in  regimen  based  upon  a  reassessment  of  the  patient  from  one  treatment  to  another,  especially  when  related  to  a  change  in  disease  progression  

�  Undercounting  of  chemotherapy  dosing  changes  (other  reports  have  suggested  higher  variation  rates  –  we  chose  to  track  only  what  was  documented  in  this  limited  data  set  for  these  four  cancers).    Another  recent  study  from  ICORE  Healthcare  found  a  20%  rate  of  change  for  shipped  cancer  drugs  –  “Moreover,  approximately  20  percent  of  drugs  shipped  to  a  provider’s  office  fail  to  be  used  due  to,  for  example,  changes  in  dose,  therapy,  duration  of  therapy,  benefit,  and  higher  costs,  since  partial  vial  use  is  not  possible  when  billing  NDC-­‐11  codes  to  the  pharmacy  benefit.  

�  Under-­‐tracking  of  actual  experience  due  to  escalating  volume  of  documentable  cases  each  month  from  April  1,  2011  to  March  31,  2012.    Actual  total  drug  administrations  in  database  for  all  of  2011  were  13,651.    In  contrast,  the  actual  total  drug  administrations  in  the  database  for  just  the  first  four  months  of  2012  (as  more  practices  came  online  with  the  EMR  and  entered  data)  were  18,495,  which  if  annualized  could  total  55,485  for  2012.    Since  the  database  is  in  a  phase  of  constant  growth,  a  conservative  decision  was  made  to  analyze  only  those  administrations  that  were  actually  documented  for  the  twelve  months  of  the  study  period  (April  1,  2011  to  March  31,  2012  –  an  actual  total  of  25,  202.  

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Percent  of  Doses  Mismatched  

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8%  

5.90%  

16.50%  

7.40%  

9.90%  

0%  

2%  

4%  

6%  

8%  

10%  

12%  

14%  

16%  

18%  

Breast   Lung   Colon   Prostate   Total  

Percent  of  Doses  That  didn't  Match  Original  MD  Order  -­‐  Dataset  4/1/11  -­‐  3/31/12  

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PotenGal  “Waste”  for  Payers  

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Breast   Lung   Colon   Prostate   Total  Total  AWP  -­‐  17%  "Waste"   $327,561   $236,764   $499,036   $90,943   $1,154,304  

Chemo  AWP  -­‐  17%  "Waste"   $171,188   $76,398   $223,426   $26,012   $497,024  

Anc  AWP  -­‐  17%  "Waste"   $156,373   $160,366   $275,610   $64,931   $657,280  

$0  

$200,000  

$400,000  

$600,000  

$800,000  

$1,000,000  

$1,200,000  

$1,400,000  

"Waste"  in  AWP  -­‐  1

7%  Value

s  

PotenGal  Dollars  of  "Waste"  due  to  Unmatched  Doses  -­‐  Dataset  4/1/11  -­‐  3/31/12  

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PotenGal  $  “Waste”  per  MD  

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$0  

$500  

$1,000  

$1,500  

$2,000  

$2,500  

$3,000  

$3,500  

$4,000  

$4,500  

$5,000  

Breast   Lung   Colon   Prostate   Total  

Poten8al  Dollars  of  "Waste"  per  MD  (at  AWP  -­‐  17%  value  of  doses)  due  to  Unmatched  Doses  -­‐  Dataset  4/1/11  -­‐  3/31/12  

Total   Chemo   Ancillary  

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Top  10  Chemo  Drugs  %  “Waste”  

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46%  

23%  

71%  

13%  36%  

11%  

23%  

70%  

30%  

20%  

Top  10  Chemo  drugs  "Waste"  %  not  matching  original  dose  -­‐  Dataset  4/1/11  -­‐  3/31/12  

Bevacizumab  

OxaliplaGn  

Trastuzumab  

Leuprolide  

Alemtuzumab  

Docetaxel  

CarboplaGn  

Cetuximab  

Rituximab  

Pemetrexed  

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Top  10  Chemo  Drugs  $  “Waste”  

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$155,150  

$79,412  $74,539  

$31,970  

$31,643  

$28,222  

$18,656  

$14,628   $12,026   $9,822  

Top  10  Chemo  Drugs  "Waste"    -­‐  doses  valued  at  AWP-­‐17%  -­‐  Dataset  4/1/11  -­‐  3/31/12  

Bevacizumab   OxaliplaGn  

Trastuzumab   Leuprolide  

Alemtuzumab   Docetaxel  

CarboplaGn   Cetuximab  

Rituximab   Pemetrexed  

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Top  5  Ancillary  Drugs  %  “Waste”  

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11.0%  

7.5%  

14.3%  42.9%  

4.7%  

Top  5  Prostate  Ancillary  Drugs  "Waste"  %  not  matching  dose  -­‐  Dataset  4/1/11  -­‐  3/31/12  

Denosumab  

PegfilgrasGm  

Zoledronic  Acid  

DarbepoeGn  

Palonosetron  

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Top  5  Ancillary  $  “Waste”  

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$21,372  

$18,013  

$14,049  

$9,054  

$1,510  

Top  5  Prostate  Ancillary  drugs  "Waste"  -­‐  doses  valued  at  AWP-­‐17%    -­‐  Dataset  4/1/11  -­‐  3/31/12  

Denosumab   PegfilgrasGm  

Zoledronic  Acid   DarbepoeGn  

Palonosetron  

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Summary  � Management  of  costs  in  cancer  is  critical  to  health  plans  

�  significant  potential  financial  costs  for  payers  under  a  shift  to  a  External  Delivered  Model  before  the  costs  of  the  drugs  actually  used  in  treatment  for  the  patients.    �  Conservatively,  almost  $5,000  per  treating  oncology  provider  

�  conservatively,  at  least  one  in  ten  cancer  treatments  for  the  top  four  cancers    

�  Slight  Variations  can  lead  to  High  “Waste”    

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Summary  –  cont.  �  Potential  high  dollar  impact  to  payers  even  if  there  are  fairly  low  (under  10%)  variations  in  drug  use  resulting  from  same  day  patient  health  status  changes  

� Many  chemotherapy  drugs  observed  in  this  study  have  notable  rates  of  variation  from  planned  doses  –  most  between  10  and  20%  and  some  even  as  high  as  100%  

�  In  lung,  prostate  and  colon  cancers,  there  is  even  a  higher  potential  dollar  impact  on  health  plans  from  variations  in  ancillary  drugs  used  to  support  high  density  chemotherapy  administration  than  there  is  in  the  chemotherapy  drugs  used  for  those  cancers.      

�  Ancillary  and  chemotherapy  impact  is  fairly  equal  for  breast  cancer  treatments.  –  yet  ancillary  drugs  are  more  likely  to  be  considered  as  candidates  for  movement  to  Delivered  Drug  Models  through  a  specialty  pharmacy.  

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ImplicaGon  messages  for  payers  �  Potential  for  unintended  high  dollar  costs  

�  Evaluation  of  specific  strategies  related  to  delivered  drug  models  and  acquired  drug  models  

�  Seek  increased  collaboration  with  providers  to  develop  coordinated  programs  that  minimize  potential  waste  

�  Ask  providers  about  current  observed  “waste”  under  existing  delivered  drug  models  

�  Consider  delivery  times  and  quantities  shipped  and  possible  impact  on  “waste”  from  current  vendors  

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Payer/Employer  Drug  Management  ExpectaGons  –  MD  or  SP  �  Patient  and  Clinical  Assessment  –  formal  process,  tough  choices,  cost  sensitivity  

�  Counsel  –  to  patients  and  providers    �  Education  –  to  patients  and  providers,  drawing  clinical  lines  and  tiering  cost  impact  

�  Outreach  –  to  control  adherence,  minimize  side  effects,  avoid  unnecessary  costs  

� Monitoring  –  utilization,  improvement,  failure,  good  or  poor  response  

�  Reporting  –  by  NDC  for  rebates,  by  evidence,  savings  and  costs,  “value”  

� Watch  large  national  or  regional  employers  that  cross  multiple  provider  markets    

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Oncology  and  Specialty  Pharmacy  –  Next  Steps  1.  Decide  what  you  can  control  given  external  forces  2.  Define  your  role  with  specialty  pharmacy  

1.   Competition,  collaboration,  or  conversion  2.  Orals,  injectables,  all  or  selected  3.  Identify  parameters  for  interaction  with  specialty  

pharmacy  1.  Vetting  2.  Flow  of  information  BOTH  ways  3.  Key  contacts  and  relationships  4.  Local,  regional  or  national  

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Internal  Review  for  Providers  �  Practice  patterns  regarding  orals  and  injectables  �  Practice  patterns  of  treatment  choices  vs  alternatives  �  Patient  monitoring,  communications,  and  oversight  for  compliance  and  adherence  (particularly  orals)  

�  Opportunities  and  challenges  of  working  with  specialty  pharmacy  (local,  regional,  national)  

�  Establish  policy  and  expectations    �  Clinical  �  Patient-­‐focused  �  Reporting  �  Care  continuum  positioning  

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Points  to  consider  �  Specialty  Pharmacy  not  currently  allowed  under  law  to  provide  injectables  to  non-­‐Medicare  advantage  patients  –  MDs  can  through  Part  B  

�  Specialty  Pharmacy  delivery  results  in  unused  drug  when  treatment  plan  changes  on  day  of  service  

�  Specialty  Pharmacy  communicates  with  patient  –  outside  of  provider  care  or  as  part  of  team  

�  Specialty  Pharmacy  buys  drugs  at  rates  higher  than  MDs  –  for  now  

�  Cancer  trained  pharmacists  growing  –  role  in  infrastructure  

�  Specialty  Pharmacy  as  industry  is  committed,  growing,  and  marketing  aggressively  –  compare  with  providers  

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No  easy  answers  � Need  deep  integration  of  new  treatment  parameters  and  processes  into  care  upstream  and  downstream  

� Need  better  integration  of  medical/drug  side  effects,  alternative  medicine,  comorbid  condition  management  

� Accountability  for  costs  of  treatment  decisions  vs  alternatives  a  growing  expectation  for  payers  and  employers  –  and  question  roles  of  pharmacist  and  MD  

� External  forces  (reimbursement  policy,  ACOs,  clinical  integration,  financial  pressures)  increasing  despite  provider  plans  to  contrary  

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Take  Aways  from  Today  � Role  of  MDs  and  Specialty  Pharmacy  in  flex  � Universal  “NO”  increasingly  difficult,  sometimes  provider  themselves  choose  “YES”  for  own  reasons  

� Control  of  decision-­‐making  regarding  treatment,  including  drug  dosing  and  schedule  is  in  flux  

� Provider  delivery  model  fluctuations  between  hospital  and  community  may  drive  role  of  specialty  pharmacy,  or  may  be  driven  by  broad  payer/employer  decisions  across  multiple  providers  

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Messages  from  Today  for  Providers  –  Community  or  Hospital-­‐Based  �  State  and  federal  regulations  and  policy  will  dictate  your  reality  �  Rapidly  growing  specialty  pharmacy  programs  outside  of  MD  plans  for  oncology  

management  future  �  Understand  �  Watch  �  Decide  on  Role  and  Interactions  –  While  you  can  

�  Positives  and  Negatives  for  specialty  pharmacy  –  know,  leverage,  and  balance  �  Delivered  drug  “waste”  �  Patient  communication,  adherence,  compliance  �  Interactions  and  alternatives  �  Medical  Benefit  management,  Pharmacy  Benefit  Management  

�  Tomorrow  will  look  different  –  guaranteed,  and  will  vary  geographically  �  We  may  or  may  not  be  masters  of  our  own  fate,  or  our  patients  –  remains  

to  be  seen  

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Thank You, and Good Luck Dawn Holcombe, MBA, FACMPE DGH Consulting 33 Woodmar Circle South Windsor, CT 06074 860-305-4510 860-644-9119 fax [email protected] www.dghconsulting.net

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