By Debra A. Patt, MD, MPH, MBA
- Utilization management, a set of tools that health care purchasers use to manage costs through case-by-case assessments of the appropriateness of care provision, is increasingly important in oncology care as oncology diagnosis and treatment has become more complex and expensive.
- Oncology utilization management includes formularies, tiered payment structures, step therapy, clinical pathways, and prior authorization. Management strategies can be prospective, concurrent, or retrospective, and they are often not transparent or seamless to clinicians and patients.
- Tools such as prior authorization and other utilization management policies can be effective in oncology care, but appropriate safeguards must be in place to ensure availability of necessary treatment and avoid critical delays in care.
Utilization management is a set of tools that health care purchasers use to manage costs through case-by-case assessments of the appropriateness of care provision.1 Payers strategically implement utilization management policies as a way to evaluate the clinical appropriateness of care and to serve as a barrier to the use of high-cost diagnostic services and interventions.
In oncology, utilization management tools have become more important as cancer costs are rising. However, these strategies present a challenging administrative burden that frequently delays and diverts appropriate care. There are more appropriate ways for payers and oncologists to collaborate to manage utilization. I am grateful to ASCO for its work to develop a position statement on utilization management, which includes important cancer-specific policy considerations, as payers develop and implement utilization management strategies.2 The policy recommendations, which are intended to improve access to life-saving cancer treatments for the patients we serve, include:
- Prior authorization policies must be streamlined to avoid unnecessary barriers, delays in care, and other administrative burdens.
- Utilization management policies must protect patient access to medically appropriate care.
- High-quality clinical pathways provide an appropriate utilization-management strategy for cancer drug treatments when adequate patient safeguards exist.
Utilization Management in Oncology: Care and Cost
Utilization management is now particularly important in oncology as the landscape of oncology diagnosis and treatment has become more complex and expensive. The appropriateness of diagnostic and therapeutic utilization is not a trivial issue, as non–evidence-based treatments can inappropriately increase costs and even harm patients. Over the last few years, the exponential increase in the cost of cancer treatments has had a dramatic impact on the total cost of care, with variable results. Oncologists today are not simply faced with which drugs to give; they must also consider the value of the therapies chosen.
As cancer specialists, we are privileged to live in a time of remarkable therapeutic innovation where we can offer disease control, or even cure, to an increasing number of patients. However, sometimes these therapies are associated with a high price tag, and the natural consequences of using these therapies is that the total cost of health care—and cancer care, more specifically—rises. Novel therapies that stimulate immune response to cancer, signal transduction modifiers that impact cancer growth, and signal intercellular communication modulators that influence the development or blood flow to metastasis are all available to us. These new agents can exceed $10,000 a month and sometimes have no finite duration of therapy, as much of advanced cancer care has become management of a chronic disease with prolonged treatment. This progress is remarkable, but it increases the total cost of care for cancer. Efficacy and toxicity are the only benchmarks used by the U.S. Food and Drug Administration in the approval process. Therefore, health care purchasers must sift through additional questions to consider the appropriate application and value added to care to determine a therapy’s most appropriate use.
Forms of Utilization Management in Oncology
Utilization management in oncology has taken on many forms, including formularies, tiered payment structures, step therapy, clinical pathways, and prior authorization—which can all be complex mazes to navigate. Management strategies can be prospective, concurrent, or retrospective, and they are often not transparent or seamless to clinicians and patients.
Restrictive formularies limit access to covered therapies by not including them in a suite of covered services. Formulary restrictions can reduce cost and improve adherence but lead to therapy discontinuation.3 If formularies are not inclusive of effective therapeutic options for cancer or symptom control, patients may not have access to effective therapies.
Tiered payment structures exist when payers cover a higher portion of preferred drugs and a lower portion of non-preferred drugs, thus aligning the cost-sharing burden of the patient to the utilization strategy of the payer. Tiered payment structures charge escalating costs for non-preferred drugs, often making high-cost drugs unattainable.
Step therapy generally requires failure of a less-expensive therapy prior to initiating a more-expensive therapy and may dictate the use of a suboptimal product first at a lower cost. Step therapy policies that require use and failure of one therapy before another therapy can lead to inappropriate treatment choices for patients and delays in care, which can potentially be dangerous.
Clinical pathways facilitate compliance with guideline-based care but can restrict utilization that is not evidence or guideline based. Warranted variation from pathway inclusion and pathway development is variable between pathway systems. Payer-driven pathway systems tend to be more restrictive and may have additional barriers to appropriate utilization of therapies for patients with cancer. Frequently simple dose reductions, which are necessary because of comorbid illness, may trigger a therapy to be pathway noncompliant on a payer-based pathway and not approved by the insurance company.
The approval process for most utilization management policies is frequently made by non-physicians on behalf of the insurance company, and the resultant delays and detours in appropriate care are anxiety provoking and potentially dangerous to patients.
Realities: Looking Forward and Guidelines for Utilization Management
Utilization management in oncology will only continue to grow. Global spending on anticancer drugs is approximately $100 billion annually and is expected to rise to $150 billion by 2020.4 With the increasing complexity of cancer care and the high cost of novel diagnostics and therapeutic interventions, additional barriers will emerge to control costs and enhance value. Important guidelines should be followed in the development of these solutions moving forward so as to not inappropriately delay or divert care for the patients we serve.
Guidelines must be implemented to ensure that utilization management enhances patient care, transparency of the processes that are in place to manage utilization, and appropriate clinical oversight by trained clinicians in oncology. Such guidelines also must foster a dynamic process of regular review for a field that is changing quickly, as well as a clear, rapid, readily available, and transparent appeals process. In oncology, pathway systems are a better solution than restrictive formularies, as they can incorporate many data elements of disease status that are important in clinical decision making instead of a categorical decision of yes/no to access a therapy.
In situations where a restrictive formulary is absolutely required because of the budget impact (e.g., in-state Medicaid programs where fixed budgets may exist), there needs to be transparency for patients and providers about the unavailability of therapeutically effective services, the criteria that is used to determine inclusion, and the appeals process. Step therapy has limited use in appropriate cancer care. Fail-first strategies could hasten poor outcomes. Tiered payment systems generally cause an unsustainable financial burden on patients and should be discouraged.
Better Solutions in Collaboration
Payers, providers, and patients share the common goal of wanting the best cancer treatment possible at the lowest possible costs. Acting in collaborative efforts to meet this common goal will be mutually beneficial. Given the immense information asymmetry that exists between providers, payers, and the patients we serve, collaboration will be optimal first between providers and payers, with the best interests of their patients guiding the recommendations of the therapy choices before them. Formularies, step therapy, and tiered-therapy structures are largely inadequate to address care appropriateness to manage the complexities of cancer care.5
Because pathways can be constructed with decision algorithms to align with complex patient scenarios, they are more suitable for utilization management in oncology. Not all pathways systems are equal in terms of composition, level of evidence, complexity algorithms of decision support, transparency in decision making, regular review of the evidence, exception process and review to ensure continued evidence based decisions, and consideration of value. Guidelines for pathway development and implementation have been put forth by ASCO.6,7 When implemented effectively, pathways can improve or hold constant the quality of care while substantially reducing cost.8,9
Technology-Enabled Solutions in Clinical Decision Support and Engaging Providers
Oncology care is often complex, requiring many data elements to guide appropriate decisions. Manual collection of this information to populate prior authorization documents is an increasing administrative burden. Payers and providers can collaborate around decision support systems to enable guideline-based and even value-based decisions at the point of care. These strategies have been effective at enhancing guideline compliance and value.10 Having technology-enabled solutions at the point of care assists physicians in making timely care decisions, and data that drive those decisions assist payers in evaluating appropriate utilization management.
Engaging clinicians in an advisory capacity to facilitate appropriate utilization management will also assist in successful value creation. ASCO is wise to provide guidance in how to optimally manage utilization to protect the interests of patients and will be a valuable collaborator in orchestrating solutions.
About the Author: Dr. Patt is a practicing oncologist and a vice president of Texas Oncology. She is editor-in-chief of JCO Clinical Cancer Informatics.