Reimbusement and Managed Care News

OBTNJune 2008
Volume 2
Issue 6

Did Reduced Reimbursement for Medical Castration Result in More Orchiectomies?

Most men prefer medical castration with luteinizing hormone-releasing hormone (LHRH) agonists as a treatment for prostate cancer over surgical castration, but the utilization data has bucked the expected trend. This may be the unintended result of a 2004 reduction in reimbursements by the Centers for Medicare & Medicaid Services (CMS) for LHRH agonists, according to authors from the Cleveland Clinic. However, if the reimbursement for LHRH agonist use in prostate cancer is reduced to the point that it results in financial loss for the practice, can physicians balance the ethical versus the financial implications for this change in payments?

The change from average wholesale price—based to average sales price methodology, resulting in an effective 65% reduction in reimbursements over the course of a couple of years, and a 7% increase in reimbursement for surgical orchiectomy has paralleled a change in practice, stated the authors. They evaluated Medicare part B records from 2001 to 2005 for claims regarding the use of LHRH agonists and orchiectomy.

Utilization of medical castration fell by 14%, the investigators found, while the number of orchiectomies rose by 4%. Their review of the literature since 2004 does not provide alternative explanations for these trends. Although medical castration is not superior to surgical castration in terms of efficacy and outcomes, according to previous studies, men consistently prefer the medical option. The authors conclude that the “most plausible explanation” for this trend is the reimbursement, which has implications for how physicians present options to their patients with prostate cancer.

Weight CJ, Klein EA, Jones JS: Androgen deprivation falls as orchiectomy rates rise after changes in reimbursement in the U.S. Medicare population.



Tidal Wave of Breast Cancer Cases Expected as Elderly Age

As the baby boomer “age wave” continues to leave a wake in health care service consumption, it is clear that this nation’s aging population will also create a tidal wave of patients with diseases of aging, including cancer. This will tax our health care resources, skill, and ability to pay for treatment. A task force report, announced recently at the annual meeting of the National Comprehensive Cancer Network, warns that we are woefully unprepared in the treatment realm of addressing the age wave’s effect on breast cancer cases.

By 2040, it is estimated that 80 million American women will be at least 65 years of age. Task force Chairman Robert W. Carlson, MD, worried that there are few studies of breast cancer treatment in women older than 70 years—they are poorly represented in clinical trials, and the medical community does not have sufficient published experience to make treatment recommendations. Clinical practice guidelines should have separate branches to detail preferred therapeutic options in these elderly women, stated Dr. Carlson, but data do not exist on which to form the guidelines.

The task force believes that these older women will require greater use (and more effective) supportive therapies to enable them to complete chemotherapeutic regimens. Dr. Carlson also cautioned, “The benefit of treatment has to be bigger in a relative sense to be worth it in an absolute sense in the older patient because of competing causes of death.”

The task force recommended the development of new testing methodologies that can determine a woman’s “physiologic age” and “functional reserve,” which may enable the clinician to choose more conservatively among the various chemotherapy, radiation, and surgical options. Furthermore, the task force believes more interest in a patients’ priorities will be an important focus when considering how to treat these elderly women.

Carlson RW: Report of the NCCN Task Force on Breast Cancer in the Older Adult. Presented at the 13th annual meeting of the National Comprehensive Cancer Network, Hollywood, Florida, March 27, 2008.

The Cost Effectiveness of Neutropenia Treatment

The use of granulocyte colony-stimulating factors (G-CSFs) is an important tool in fighting febrile neutropenia. Health economists from the University of Rochester School of Medicine and Dentistry, New York, sought to determine the cost effectiveness of G-CSF therapy.

The investigators used a cost-utility model to estimate the cost effectiveness of the conventional G-CSF (filgrastim), pegylated form (pegfilgrastim), and no therapy was calculated. If patients received filgrastim treatment, it was assumed that it was given daily for seven to 12 days after chemotherapy was administered. If patients received pegfilgrastim, it was assumed to be administered once per chemotherapy cycle. A societal point of view was assumed for all cost-effectiveness calculations.

The economists asserted that the use of the pegylated G-CSF was more cost effective than the other treatment options, while yielding the same clinical benefit as conventional G-CSF, across various clinical scenarios. The Table provides data on the baseline situation analysis, showing that although not using G-CSF resulted in lower costs than using filgrastim, it did not provide as great a clinical benefit.

Cost effectiveness of pegfilgrastim



Pegylated G-CSF





Quality- Adjusted Life-Days




G-CSF = Granulocyte colony-stimulating factor.

Eldar-Lissai A, Cosler LE, Culakova E, et al: Economic analysis of prophylactic pegfilgrastim in adult cancer patients receiving chemotherapy.


Value Health

Does Lower Toxicity Trump Efficacy in Cost-Effectiveness Study of Two Breast Cancer Regimens?

The use of the adjuvant drug combination of docetaxel, doxorubicin, and cyclophosphamide is thought to be more toxic but also more effective than the combination regimen including fluorouracil rather than docetaxel. Health economists from Manchester, United Kingdom sought to calculate whether the increased efficacy of the more toxic docetaxel combination resulted in better cost effectiveness, even when prophylactic therapy for febrile neutropenia is factored into the equation.

Using a Markov decision-analysis model for patients with node-positive early-stage breast cancer and clinical efficacy and toxicity data from the Breast Cancer International Research Group 001 trial, the researchers calculated the incremental cost per life-year saved over a 10-year time horizon as well as the incremental cost per quality-adjusted life-year (QALY) gained.

Their analysis yielded a significant advantage to the use of the docetaxel-containing regimen, even when the increased use of granulocyte colony-stimulating factor was considered. Using the docetaxel-containing regimen rather than the fluouracil-containing combination resulted in an incremental cost per life-year saved of approximately $30,600 and an incremental cost per QALY of $36,100. With the use of neutropenia prophylaxis (given to all patients) factored in, the incremental cost per QALY was slightly higher, at $40,500. The researchers noted that the results did not change substantially across a range of quality-of-life scores.

They concluded that the docetaxel-containing regimen was more cost effective than the fluouracil combination for node-positive early-stage breast cancer, even though the regimen may require greater use of granulocyte colony-stimulating factor and be more toxic overall.

Wolowacz SE, Cameron DA, Tate HC, et al: Docetaxel in combination with doxorubicin and cyclophosphamide as adjuvant treatment for early node-positive breast cancer: A cost-effectiveness and cost-utility analysis.


J Clin Oncol

How Much Does It Cost to Support Breast Cancer Survivors?

Women who survive breast cancer (and the rigors of its treatment) often benefit from psychosocial support to help them adjust to their new physiologic status (e.g., altered body image resulting from mastectomy, disability resulting from surgery). However, psychosocial support programs and educational materials are not universally used. Oncologists and psychologists from Washington, DC, and Los Angeles, California, attempted to determine in an innovative study, how much these interventions would cost society.

Utilizing women who were concurrently taking part in a clinical breast cancer study, the researchers considered that positive outcomes of an increase in energy (increased vitality) or decrease in distress (both measured using validated scales) compared with the incremental cost of delivering psychoeducational programs to help women transition to breast cancer survivor status. They evaluated costs for six months after educational intervention delivered using video only information, video-provided information with counseling, or no intervention. The direct costs of not providing educational resources were determined to be $11.30, compared with $25.85 for video education, and $134.47 for video plus counseling.

In this unique economic outcomes study, the investigators found that the cost per unit energy increased or decrease in stress varied significantly with the end result—whether the woman was more prepared for transition to survivorship status. They found that video education plus counseling was less cost effective than video alone for nearly all scenarios, except in women who were more prepared for transition before the intervention was given, where it cost $1,066 per unit decrease in distress less than video alone. In most cases, video education alone was more cost-effective than doing nothing in terms of vitality improvement for all women, at $2.22 per unit increase in energy for all women. In terms of lowering distress, however, the video-intervention only cost $7,275 more than if nothing was done in the overall group. Interestingly, in those women who needed the intervention most, who were least prepared for the transition to survivorship status, the video intervention cost $355 less than the control group.

The results of this study indicate that educational video programs may be more cost effective than when combined with counseling to improve transition to breast cancer survivorship. However, the researchers caution that standards or thresholds do not yet exist for determining the cost effectiveness in the case of psychosocial endpoints.

Mandelblatt JS, Cullen J, Lawrence WF, et al: Economic evaluation alongside a clinical trial of psychoeducational interventions to improve adjustment to survivorship among patients with breast cancer.


J Clin Oncol

Do Digital Mammograms Answer or Raise More Possible Questions?

Health plans and other payers know that digital mammography costs more than conventional film mammography. However, the increased cost might be justified if they can provide clearer answers in women with dense breast tissue and prevent false positives or repeat procedures. In some radiologists’ practices, more women are in fact being called back for a second test after digital imaging than with x-ray mammography. Are they too sensitive, showing artifact that confuses the radiologist interpreting the test? This is a real issue, particularly in light of the rapid growth of digital mammography centers around the country and their increased costs.

New York Times

According to an article in the , radiologists believe that this might simply be the result of a transition period, in which they become acclimated to seeing more calcium deposits or cysts in digital images of breast tissue. Beyond the higher costs of digital mammography (up to $120 more per screening), the serious distress of the woman who is informed that she must return to the center for another screening is a major problem.


In the survey of 10 radiologists using the new systems, eight admitted that their callback rates have been more than 10%, below which was considered the standard of quality.

Thirty-two percent of mammography centers now have at least one digital mammography machine. Is this simply part of the mammography learning curve, and will actually result in lower call-back rates in the long run? At a cost of $350,000 to $600,000, around four times the cost of film mammography machines, everyone involved hopes this is the case. However, there are no studies published to indicate what the longer-term trend will be.

Grady D: In shift to digital, more repeat mammograms.

New York Times April 10, 2008.

Oncologists vs. Managed Care Payers

Payers are increasingly adopting average sales price (ASP) methodology to reimburse for the provision of oncologic drugs, and two-thirds of physician practices responding to a survey reported lower total revenues, according to a new managed care and oncologist survey. However, the adoption of ASP methodology has been slower than payers had expected, state the researchers.

A total of 125 oncology practices responded to the research, which was part of a study of managed care and physician attitudes towards reimbursement and management. The oncologists expect to see more assertive payer roles within the next 12—18 months, involving clinical decision making and off-label use of medication, and continued movement towards ASP-based payments (ASP 6% was the most common method reported [over 40% of respondents], but ASP 12% was also indicated by more than 20% of respondents).

There is a little good news for oncologists when discussing contracting leverage: Payers seemingly do not have high opinions of hospital outpatient care departments’ treatment efficacy, cost efficiency, or cost-management capabilities. Although infusion clinics do compare favorably, oncologists can effectively resist payers’ moves to hospitalbased infusion centers. According to the survey, the availability of these alternative infusion sites will force oncology practices to “refine their value propositions.”

The oncologists fear that the increasing use of prior authorization and greater cost-sharing requirements on the part of patients will lead many patients to forego certain treatments. They also fear continued erosion of practice autonomy related to managed care requirements. According to the survey, payers are more focused on the cost-control aspects in oncology care than on clinical practice decision making.

Lin C, Cabanilla A, Dautel N, et al: Monitoring the changing oncology environment: Lessons for managed care pharmacy from a national study. Presented at the 20th annual meeting of the Academy of Managed Care Pharmacy, San Francisco, CA, April 16—19, 2008.

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