Bruce Feinberg, DO: It’s interesting that I’m hearing a lot of long-term strategy. Bhavesh, you went long term and big picture. Michael, for the most part, you went long term in your big picture because it’s a value-based care strategy and not about this year’s numbers. Kathy, you went long, and Karina went long.
I wonder how many community practices with 3 or 5 doctors can afford to think long term. Are they thinking in the business next year? I wonder about that thought process, and they are not an insignificant segment of the oncology provider space.
Bhavesh Shah, RPh, BCOP: In terms of what the financial impact has been for us, from our biosimilar experience, by adopting about 98% of our patients, we’re able to save our health system $1.5 million. What does that mean to us and the patients? From a global perspective, 50% of our payments come from a risk-based model. If we’re able to lower that cost, we’re actually able to help sustain our business with our payers longer and also offset the cost of more innovative therapies.
It helps to continue to adopt new therapies and continue the path you need to have in oncology. As you said, it’s long term. You’re not going to see an immediate effect at the time of your switching.
Something that’s really quirky with list pricing is that you see a lot of contracts that are not publicized, which are not reflective of what you see in a list price. You might be seeing a list price as 10% or 15%, but there are institutions that are getting 30% or 40%, which is really helping to drive that cost down. Based on Kaiser Permanente, they publicize that they’re going to be saving $200 million from switching to oncology biosimilars. That’s a huge impact for a single payer, so there is a long-term benefit that we’re going to see.
Michael Diaz, MD: You bring up a very good point, Bruce. Many practices are used to looking at things from a day-to-day perspective. Do I have the ability to keep my practice open month to month? Overall, the best way to plan long-term survival is to be able to create an environment in which you can change from that philosophy to a longer-term philosophy, which will allow you to keep your doors open.
That’s where we’re working with the smaller practices, so they have the ability to play these long-term games and remain economically viable. That’s happening on all levels. Our institutions are helping with that. I know that some of the payers are investigating and encouraging these types of relationships. We have to constantly evolve in order to continue to meet needs and stay in business, so to speak.
Bruce Feinberg, DO: Michael, if your practice was not so heavily engaged in risk-based models or value-based care models, do you think this would have been something you could have sold to the rank-and-file physician members?
Michael Diaz, MD: That’s a very good question. It would have been a lot more difficult because people wouldn’t understand how that would benefit them long term, help keep their doors open, and ensure that they can pay their staff and all their overhead. There is a lot of overhead associated with our practices, and not everyone is aware of that. Most are, but it would have been a much more difficult sell. I can tell right now that we’d be facing a lower conversion rate, compared with what we’re seeing, so yes.
Bruce Feinberg, DO: I think about that because estimates are that 50% of adult oncology patients are being cared for in a non-risk-sharing practice. It’s not just OCM [Oncology Care Model]. If you include OCM and ACOs [accountable care organizations], we’re still talking about 50% who are being managed outside that.
The economic impact is interesting, as we’ve been hearing this. It seems like a lot of that is related to the value-based care design that either you have or you’re working toward that’s going to do this. Certainly, if you’re smaller, you’re not going to get the face time with the payer. You’re not going to likely have the quality of the contracts and the opportunity for the volume that’s going to give you leverage. It is going to make it tough.
I want to bring that up for our audience. We want to have people like you all in these panels who are incredibly knowledgeable, but it often means they aren’t fully representative. I’m sure it’s been talked about at COA [Community Oncology Alliance Annual Conference] and in other meeting environments, where I imagine this is not the same story across all practice types.