The current fee-for-service system is a hindrance to quality healthcare. It picks apart the care of a patient, breaking it down into diagnostic exams and therapeutic drugs, referrals and consultations. It encourages the overuse of technology and overprescription of drugs.
Decisions on care need to focus on choosing the best regimen for a particular patient, according to Peter Bach, MD, associate attending physician at New York's Memorial Sloan-Kettering Cancer Center. this will allow margins to be maintained and encourage doctors to act in the longterm interest of the patient. "We need to wrap payment around the episode. But that is going to be challenging," he said.
Dr. Bach, along with other policy experts, gathered at the 2009 Mid-South Cancer Symposium in Memphis to offer insight into how quality is defined and measured in healthcare today. The symposium was hosted by the University of Tennessee Cancer Institute.
As workflow becomes more rational and evidence-based medicine takes hold, variability will decline and quality will rise, said Douglas Blayney, MD. "We need to do the same thing every time," said Dr. Blayney, medical director at the University of Michigan Comprehensive Cancer Center and president of ASCO. "And when we make a mistake, we have to learn from it. that is where we need to go."
The episode-based system
One way to implement episode-based payment is to tie reimbursement for one year of treatment or management of a patient to the diagnosed stage of a particular cancer, said William T. McGivney, PhD, CEO of the National Comprehensive Cancer Network, based in Fort Washington, Penn.
Transition to such an episode-based or global payment scheme is needed, "but it will be extremely painful," according to Donna Abney, executive vice president of Methodist Le Bonheur Healthcare in Memphis.
Decades of fee-for-service have created a disincentive to rapid and significant change. Improvements in the past have been made in iterative steps. Attesting to the difficulty of making sweeping changes are the Obama administration's efforts at healthcare reform. Amid the bickering partisan voices have been calls for iterative reform of the existing system.
"The reality of Washington and the reality of politics is that (government efforts) end up being iterations," Dr. Bach said.
Piloting the new healthcare system
Real change, therefore, may have to come from outside the existing system, through end runs staged by providers and third-party payers working together. Some such efforts are happening now, as pilot projects sponsored by insurance companies. These pilots carve out certain types of oncology cases, challenging oncologists and insurers to think differently about care so as to produce better outcomes.
"Blue Cross is willing to fund these pilots and look at payment redesign," said Thomas G. Lundquist, MD, vice president of Performance Measurement and Improvement at Blue Cross Blue Shield of Tennessee in Chattanooga. "We are looking at these small steps, and I think they are going to pick up speed."
"The problem with pilot programs is the reason for their success. They are tightly defined, highly focused, and built on one-off negotiations between specific insurers and particular providers," said James D. Cross, MD, head of national medical policy and operations for Aetna in Hartford, Conn. "What we really need is broad payment reform that makes change happen for everybody across the board," he said. "I just don't think we are anywhere close to that."
Dr. Lundquist suggested that pilot programs may provide the ammunition for exactly this kind of wide-scale reform. They can be used to identify best practices, which might be translated into better clinical outcomes on a broad scale. Variability in practice creates waste, he said. Identifying best practices that can be applied routinely will improve quality by taking variation out of the system.
"So even though quality costs more on an episode basis, you save on the waste you eliminate by getting rid of variation," Dr. Lundquist said.