Two independent trends, acting in combination, are currently resulting in increased Medicare fee-for-service (FFS) chemotherapy payments. The first trend is a shift in the site of care for cancer patients from physicians’ offices to hospital outpatient departments. Several factors contribute to this shift; this study evaluates the effects of one of those factors—the acquisition of physician-based oncology practices by 340B hospitals. The second trend is higher Medicare reimbursement rates for and greater utilization of chemotherapy administration in hospital outpatient departments compared to physicians’ offices. This trend is driven by Medicare rate setting policy and hospital utilization patterns and has been reported in studies performed over the last three years.
Our analysis of Medicare hospital outpatient claims (which does not include any Medicare Advantage claims) and physician office claims indicates that there has been little change in the overall volume of chemotherapy claims between 2008 and 2012. However, during this same period, approximately 11.6 percent of the overall chemotherapy claims volume has shifted from physicians’ offices to hospital outpatient departments. The acquisition of physician-based oncology practices by 340B hospitals is a significant contributor to this shift. Based on our analysis of data provided by the Community Oncology Alliance (“COA”) and the Office of Pharmacy Affairs (“OPA”), at least 120 340B hospitals acquired one or more physician-based oncology practices between 2009 and 2012. For 86 of these hospitals, the acquisition led to a measurable increase (>20 percent) in the volume of chemotherapy claims, exclusive of oral chemotherapy drugs, billed to Medicare for Medicare FFS beneficiaries. By 2012, the claims attributable to these acquisitions accounted for over 15.6 percent of the claims shifted from physicians’ offices to hospital outpatient departments...
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Topics: Cancer, CMS, Fee-for-Service, Healthcare, Hospitals, Medicare, Physician Medicare Reimbursements, Physicians, Section 340B
Published In: Health Updates, Science, Computers & Technology Updates
DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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