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News | Community Oncology Alliance press release

New Survey Reveals Community Oncology Practices Face Serious Challenges Affecting Nation's Cancer Care

March 26, 2015

Community oncology practices, in
which close to 70% of the nation’s cancer care is delivered, face serious
challenges according to a recent survey by Berkeley Research Group (BRG) researchers Aaron Vandervelde and JoAnna Younts. In the survey, commissioned by the
Community Oncology Alliance (COA), 33% of community oncology practices reported
being in serious acquisition discussions with hospital systems or in merger talks
with other practices. This continues a trend that COA has reported in its Community Oncology Practice Impact Report,
which has indicated that 544 practices have been acquired by hospital systems
and 149 have merged with other practices, in addition to 313 community oncology
treatment clinics that have closed since 2008.

The survey reveals that community
oncology practices cited reimbursement rates for drugs (98%), reimbursement
rates for chemotherapy administration (90%), and the cost of regulatory
compliance (87%) as being “very important” or “extremely important” challenges
threatening the ongoing viability of their practices. For those practices in
merger or acquisition discussions, 56% cited declining reimbursement, 48% cited
a need to decrease costs, and 44% cited increased competition as the primary
reasons for considering a merger or acquisition.

“The survey results seem to
indicate that mergers between community oncology practices are evaluated from a
position of strength, such as improving negotiating power, while acquisitions
by hospitals typically occur from a position of greater financial stress,” according
to lead BRG researcher Aaron Vandervelde.

Hospital acquisitions of
community oncology practices are a primary factor in the shift in the site of
care from physician offices to hospital outpatient departments. Over 65% of
survey respondents believe that 340B drug pricing available to certain
hospitals is a primary contributor to the shift in site of care to hospital
outpatient departments. Recent analysis by Vandervelde and others revealed that
the percentage of chemotherapy administration in the hospital outpatient
department increased from 18% in 2008 to 34% in 2013. Several studies by IMS
Health, The Moran Company, Avalere Health, and Milliman have documented the
increased cost to patients and payers when chemotherapy treatment is provided
in a hospital outpatient department compared to a physician office.

“Community oncology is making
incredible strides in innovating novel payment reform that is increasing the
quality and efficiency of cancer care,” says Ted Okon, COA executive director. “It’s
incomprehensible that misguided public policy is forcing consolidation of
cancer care in this country and driving up the costs of care for patients, when
it should be doing the exact opposite.”

COA commissioned BRG researchers Aaron Vandervelde and JoAnna Younts to produce a
comprehensive white paper on the model of integrated community oncology. The
early survey results reported here are parts of that white paper, which will be
released at the Community Oncology Conference in Orlando on April 23–24, 2015.

About Community Oncology Alliance (COA) 

The Community Oncology
Alliance (COA) is a non-profit organization dedicated solely to preserving and
protecting access to community cancer care, where almost 70% of Americans with
cancer are treated. COA has led community cancer clinics in navigating an
increasingly challenging environment to provide efficiencies, patient advocacy,
and proactive solutions to Congress and policy makers. COA members have testified before both
chambers of Congress, authored cancer care demonstration projects, and been
instrumental in the passage of oral cancer drug parity legislation, among many
other initiatives. More
information can be found at www.CommunityOncology.org.

Professionals

Related Professionals

Aaron Vandervelde

Managing Director

Washington, DC

JoAnna Younts

Director

Washington, DC