To the surprise of noone

[Chartreuse Wombat]

Cancer Care Expenditures and Utilization for Surgery Among Patients With Private Insurance

This cross-sectional study examines differences in cancer care spending and utilization for patients with private insurance undergoing common cancer surgical procedures at National Cancer Institute (NCI) centers vs community hospitals.

jamanetwork.com

In this cross-sectional study of 66 878 patients with breast, colon, or lung cancer, surgery at NCI centers, compared with community hospitals, was associated with higher insurer prices paid and higher 90-day postdischarge payments, without differences in length of stay, emergency department use, or hospital readmission.

For commercial payers, who are keenly aware that discrepancies in hospital negotiated prices contribute to premium growth, our findings suggest an incentive to steer patients away from high-cost hospitals.

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[evilbooyaa]

Authors are from UPenn
UPenn is an NCI designated cancer center

Got a med onc, a urologist, and a rad onc on the paper

My mind is blown that authors from UPenn would write a paper saying that the high cost care their institution provides has lower value than their competitors who are not NCI cancer centers

I imagine the breast surgeons, colorectal surgeons, and thoracic surgeons who were NOT included on this paper looking at just those three types of surgeries could have a reason to be pretty pissed.

 

[evilbooyaa]

The authors cite papers in their intro that says NCI designated centers have better post-op mortality and better survival outcomes than non-NCI designated cancer centers.

They do not refute any of these claims from the cited papers in the introduction within the paper. There is one line about this as a future study - "Further research examining hospital-level differences in long-term postsurgical outcomes, such as mortality, paired with spending outcomes, is necessary to judge whether and under what circumstances the premium price of NCI centers is justified."

Anyone who believes in or works at an NCI simply responds with: "OK well it's more expensive, but we have less post op mortality AND our survival outcomes are better! Who cares if a patient gets re-admitted or not if they're more likely to have their cancer recur and die from it because the surgeons at those non-NCI places are so bad! Would you be willing to pay more to have a higher chance of surviving in the short and long term after your cancer surgery? Because that's what you get when you come to your local NCI cancer center!"

I do like their limitaitons section (bolded my emphasis) - "First, the analysis was limited to patients with private insurance undergoing cancer-directed surgery for breast, colon, or lung cancer, and may not generalize to patients with other malignant neoplasms or those receiving nonsurgical cancer care. However, these are 3 of the 4 most common incident cancers and make up most of cancer surgical volumes nationally, suggesting that our results may at least extend to other oncologic surgical populations."

"We included all of the most common cancers. Except prostate cancer. Because there's a Urologist on the paper. And he said if we include our collected prostate data (which says the same thing, probably), he wouldn't want to be co-author on it. And then we'd have zero surgeons. About a paper that says our own facility gets paid more for their surgery without any savings in terms of less toxicities/re-admissions, etc. Which wouldn't be a good look. So we had to have a surgeon. So we scrapped the prostate data. And plus some of those folks pick radiation so if you're going to skip one, might as well make it that one."

 

[RadOncMegatron]

The authors cite papers in their intro that says NCI designated centers have better post-op mortality and better survival outcomes than non-NCI designated cancer centers.

They do not refute any of these claims from the cited papers in the introduction within the paper. There is one line about this as a future study - "Further research examining hospital-level differences in long-term postsurgical outcomes, such as mortality, paired with spending outcomes, is necessary to judge whether and under what circumstances the premium price of NCI centers is justified."

Anyone who believes in or works at an NCI simply responds with: "OK well it's more expensive, but we have less post op mortality AND our survival outcomes are better! Who cares if a patient gets re-admitted or not if they're more likely to have their cancer recur and die from it because the surgeons at those non-NCI places are so bad! Would you be willing to pay more to have a higher chance of surviving in the short and long term after your cancer surgery? Because that's what you get when you come to your local NCI cancer center!"

I do like their limitaitons section (bolded my emphasis) - "First, the analysis was limited to patients with private insurance undergoing cancer-directed surgery for breast, colon, or lung cancer, and may not generalize to patients with other malignant neoplasms or those receiving nonsurgical cancer care. However, these are 3 of the 4 most common incident cancers and make up most of cancer surgical volumes nationally, suggesting that our results may at least extend to other oncologic surgical populations."

"We included all of the most common cancers. Except prostate cancer. Because there's a Urologist on the paper. And he said if we include our collected prostate data (which says the same thing, probably), he wouldn't want to be co-author on it. And then we'd have zero surgeons. About a paper that says our own facility gets paid more for their surgery without any savings in terms of less toxicities/re-admissions, etc. Which wouldn't be a good look. So we had to have a surgeon. So we scrapped the prostate data. And plus some of those folks pick radiation so if you're going to skip one, might as well make it that one."

Treatment at NCI is like a Gucci hand bag. "Do you really want 8 Gy x 1 from Target/Community Center? Come to the Gucci store/NCI hospital where you get free Starbucks coffee in the lounge!"

 

[gmsquid]

To be fair, case complexity is probably higher at high volume centers.

 

[OTN]

To be fair, case complexity is probably higher at high volume centers.

Perhaps, but patient selection in my experience usually means healthier, wealthier patients find their way to those same centers.

 

[seper]

Those who know Justin say he just loves to talk and write. about anything he will be forgiven.
Not only Penn chargers more than competition, they just select the most lucrative modality. Think spine SBRT as default

 

[deleted941485]

Oh those brave “providers” at penn doing God’s work.

 

[medgator]

Perhaps, but patient selection in my experience usually means healthier, wealthier patients find their way to those same centers.

Patient selection including PPS exempt centers and payors choosing who gets to be in network... Also favoring those demographics

 

[medgator]

Cancer Care Expenditures and Utilization for Surgery Among Patients With Private Insurance

This cross-sectional study examines differences in cancer care spending and utilization for patients with private insurance undergoing common cancer surgical procedures at National Cancer Institute (NCI) centers vs community hospitals.

jamanetwork.com

In this cross-sectional study of 66 878 patients with breast, colon, or lung cancer, surgery at NCI centers, compared with community hospitals, was associated with higher insurer prices paid and higher 90-day postdischarge payments, without differences in length of stay, emergency department use, or hospital readmission.

For commercial payers, who are keenly aware that discrepancies in hospital negotiated prices contribute to premium growth, our findings suggest an incentive to steer patients away from high-cost hospitals.

Less than 1/3 compliant with price transparency

Compliance of National Cancer Institute–Designated Cancer Centers With January 2021 Price Transparency Requirements

This cross-sectional study investigates the compliance rate of hospitals with National Cancer Institute–designated cancer center status with the Centers for Medicare & Medicaid Services January 2021 price transparency requirements.

jamanetwork.com

 

[Gfunk6]

The Penn authors can publish whatever they want, they are effectively immune to the consequences of their conclusions. The next time Penn's UHC contract is up for renewal:

UHC rep: So, I see that we are paying you 800% of Medicare rates. However, I saw that article you guys published saying that your clinical metrics are no better than any of your competitors. Therefore, UHC has opted to not raise your rate at this time.

Penn: If you don't raise our rate to 900% of Medicare then we will stop accepting your insurance product at our main hospital and many, many satellite affiliates.

UHC rep: We are a multi-billion dollar company, you don't scare us!

*** Penn sends an email out to all of their patients indicating that UHC is acting "unreasonably" particularly since UHC is seeing record profits. Penn cautions UHC may no longer be accepted in the near future, heavily implying that those patients should seek alternatives. Based on this email, UHC fields hundreds of irate phone calls from patients demanding they comply with Penn or else the patients will jump ship.

UHC: 900% it is!!!

 

[OTN]

The Penn authors can publish whatever they want, they are effectively immune to the consequences of their conclusions. The next time Penn's UHC contract is up for renewal:

UHC rep: So, I see that we are paying you 800% of Medicare rates. However, I saw that article you guys published saying that your clinical metrics are no better than any of your competitors. Therefore, UHC has opted to not raise your rate at this time.

Penn: If you don't raise our rate to 900% of Medicare then we will stop accepting your insurance product at our main hospital and many, many satellite affiliates.

UHC rep: We are a multi-billion dollar company, you don't scare us!

*** Penn sends an email out to all of their patients indicating that UHC is acting "unreasonably" particularly since UHC is seeing record profits. Penn cautions UHC may no longer be accepted in the near future, heavily implying that those patients should seek alternatives. Based on this email, UHC fields hundreds of irate phone calls from patients demanding they comply with Penn or else the patients will jump ship.

UHC: 900% it is!!!

Kinda seems to me like Penn has an illegal monopoly on healthcare services in the market if they have that much power in said marketplace.

 

[A_DeMichele]

pretty powerful is Philly area, but not quite a monopoly in adult oncology

 

[Gfunk6]

pretty powerful is Philly area, but not quite a monopoly in adult oncology

The thing is Penn has metastasized far beyond metro Philadelphia.

https://www.pennmedicine.org/practices

 

[Mandelin Rain]

Kinda seems to me like Penn has an illegal monopoly on healthcare services in the market if they have that much power in said marketplace.

This is the way.

 

[jondunn]

Agree. And it’s not something the government is not aware of

The large hospital system problem is a problem.

I see this problem only getting bigger now that insurance companies are buying these systems more and more.

Something will have to give

 

[Mandelin Rain]

Agree. And it’s not something the government is not aware of

The large hospital system problem is a problem.

I see this problem only getting bigger now that insurance companies are buying these systems more and more.

Something will have to give

As long as that sweet, sweet AHA money keeps flowing in nothing will be done.

 

[RickyScott]

The thing is Penn has metastasized far beyond metro Philadelphia.

https://www.pennmedicine.org/practices

Some thoughts
1) 3 proton centers- cherry hill, main campus and lancaster!
2) makes all the business sense in the world for penn to overhire and keep those docs "hungry". Just treating 2 or 3 of borderline G6/G7 (3+4) prostate cases a year at 900% cms is more than their entire salary.

 

[jondunn]

As long as that sweet, sweet AHA money keeps flowing in nothing will be done.

well there is Congress and there is the Department of Justice - but yeah, I agree, Congress has every reason ($$$$) to stop DOJ from doing much

 

[Fpg1245]

The thing is Penn has metastasized far beyond metro Philadelphia.

https://www.pennmedicine.org/practices

They have a funny way of metastasizing into affluent areas too. I feel bad for anyone who is employed by them. Notoriously poor pay for the dubious privilege of being a Penn doctor. At this point It isn’t even a research institution it’s just a giant conglomerate attached to a research institution.

 

[medgator]

They have a funny way of metastasizing into affluent areas too. I feel bad for anyone who is employed by them. Notoriously poor pay for the dubious privilege of being a Penn doctor. At this point It isn’t even a research institution it’s just a giant conglomerate attached to a research institution.

Common theme working at some of the big names along the northeastern seaboard from what I'm seeing

 

[TheWallnerus]

They have a funny way of metastasizing into affluent areas too. I feel bad for anyone who is employed by them. Notoriously poor pay for the dubious privilege of being a Penn doctor. At this point It isn’t even a research institution it’s just a giant conglomerate attached to a research institution.

If by funny you mean predictably pecuniary

 

[RickyScott]

They have a funny way of metastasizing into affluent areas too. I feel bad for anyone who is employed by them. Notoriously poor pay for the dubious privilege of being a Penn doctor. At this point It isn’t even a research institution it’s just a giant conglomerate attached to a research institution.

Why would they ever need a radonc palliative care network given their reach?

 

[temujim]

As long as that sweet, sweet AHA money keeps flowing in nothing will be done.

Government actively encouraging consolidation.

 

[Fpg1245]

Why would they ever need a radonc palliative care network given their reach?

Anything to imply the inadequacy of non Penn facilities

 

[jondunn]

What is the rule around this - a hospital system has smaller freestanding ‘affiliates’ that don’t actually have hospital beds but still bill hospital charges rather than free standing - is there a limit on how far away from the hospital they can be and still charge hospital prices?

 

[Gfunk6]

What is the rule around this - a hospital system has smaller freestanding ‘affiliates’ that don’t actually have hospital beds but still bill hospital charges rather than free standing - is there a limit on how far away from the hospital they can be and still charge hospital prices?

Not only is the distance irrelevant - Penn can charge the same rates in Philadelphia as anywhere in New Jersey, but the hospital's favorable government treatment also applies. Perfect case in point is City of Home who is exempt from Medicare traditional FFS payments. They recently bought Cancer Treatment Centers of America a notoriously cult-like for profit hospital. Historically CTCA limited Medicare patients due to crap reimbursement but now COH has opened up a completely new class of patients they can fleece for money.

 

[Lamount]

Government actively encouraging consolidation.

CMS incentives consolidation with complexity... though I doubt they are clever enough to do it on purpose.

 

[RickyScott]

Penn often builds/purchases satellites in close proximity to their own pre- existing centers to squeeze every possible pt out of the catchement area. Supposedly, it really pissess off some of their radoncs.

 

[evilbooyaa]

Not only is the distance irrelevant - Penn can charge the same rates in Philadelphia as anywhere in New Jersey, but the hospital's favorable government treatment also applies. Perfect case in point is City of Home who is exempt from Medicare traditional FFS payments. They recently bought Cancer Treatment Centers of America a notoriously cult-like for profit hospital. Historically CTCA limited Medicare patients due to crap reimbursement but now COH has opened up a completely new class of patients they can fleece for money.

There is generally a mile radius around the original PPS exempt site (the mother ship) above which you can longer charge the PPS exempt rate.

I don't see CTCA making CoH PPS exempt numbers anytime soon. Same with most of Penn's reimbursement, but if they have 3(!) separate proton centers they probably don't care about that at all....

 

[jondunn]

There is generally a mile radius around the original PPS exempt site (the mother ship) above which you can longer charge the PPS exempt rate.

I don't see CTCA making CoH PPS exempt numbers anytime soon. Same with most of Penn's reimbursement, but if they have 3(!) separate proton centers they probably don't care about that at all....

my question was not about PPS exempt (though this is good info to know too) but rather hospital vs freestanding charges

 

[evilbooyaa]

my question was not about PPS exempt (though this is good info to know too) but rather hospital vs freestanding charges

I do not know the answer to your question, but I was replying to Gfunk's post as I quoted it above.

I'm not sure there is an inherent advantage to calling something hospital-based if it is actually a freestanding facility...?

 

[jondunn]

I do not know the answer to your question, but I was replying to Gfunk's post as I quoted it above.

I'm not sure there is an inherent advantage to calling something hospital-based if it is actually a freestanding facility...?

yeah it does because hospital charges are more.

this is what Gfunk was answering of mine

 

[RickyScott]

my question was not about PPS exempt (though this is good info to know too) but rather hospital vs freestanding charges

What really matters is the negoatiated prices with the insurers and they clearly have tremendous leverage in the market to set prices.

 

[evilbooyaa]

yeah it does because hospital charges are more.

this is what Gfunk was answering of mine

Hospitals charge more than private locations (that are freestanding mostly), yes.

But, if a hospital owns both a hospital based and a freestanding facility (with the same negotiated reimbursement rates) what causes the discrepancy? There are multiple codes that are actually not considered billable in hospital based that you can bill in the freestanding setting?

 

[jondunn]

Hospitals charge more than private locations (that are freestanding mostly), yes.

But, if a hospital owns both a hospital based and a freestanding facility (with the same negotiated reimbursement rates) what causes the discrepancy? There are multiple codes that are actually not considered billable in hospital based that you can bill in the freestanding setting?

Medicare reimbursement is Z at a hospital and X at freestanding center. My question is whether penn as a mothership hospital can still charge CMS Z even when patients are being treated 50 miles away at a clear freestanding center - sounds like what Gfunk is saying is that penn will still call those places ‘hospital affiliated’ to get more out of medicare

I had wondered if there was a rule or limitation - gfunk says no

I don’t think this is about hospital vs private. Plenty of private practices are hospital based. Would venture to say the majority? Though I’m not sure

 

[Gfunk6]

There is generally a mile radius around the original PPS exempt site (the mother ship) above which you can longer charge the PPS exempt rate.

I don't see CTCA making CoH PPS exempt numbers anytime soon. Same with most of Penn's reimbursement, but if they have 3(!) separate proton centers they probably don't care about that at all....

I've heard that COH's legal team was going to aggressively try to get PPS exemption to apply to CTCA. Apparently they were optimistic that this would happen though I've not heard the final verdict.

 

[evilbooyaa]

I've heard that COH's legal team was going to aggressively try to get PPS exemption to apply to CTCA. Apparently they were optimistic that this would happen though I've not heard the final verdict.

I mean... it hasn't applied to COH's own satellite network within California when they acquired that first big PP. Not sure how one plans to make a leap to a national network of hospitals.

 

[RickyScott]

There is generally a mile radius around the original PPS exempt site (the mother ship) above which you can longer charge the PPS exempt rate.

I don't see CTCA making CoH PPS exempt numbers anytime soon. Same with most of Penn's reimbursement, but if they have 3(!) separate proton centers they probably don't care about that at all....

I think it is 30-35 miles?

 

[fiji128]

What is the rule around this - a hospital system has smaller freestanding ‘affiliates’ that don’t actually have hospital beds but still bill hospital charges rather than free standing - is there a limit on how far away from the hospital they can be and still charge hospital prices?

If the free standing clinic is classified as a HOPPS site it can bill at main hospital site rates. The radius for something to qualify for HOPPS is like 35 miles.

Is It Time to Reevaluate Your Off-Campus Hospital Outpatient Department Strategy? - PYA

In 2019, CMS is expanding its payment reductions to include certain services furnished in any off-campus HOPD locations—not merely non-excepted locations.

www.pyapc.com

 

[yesmaster]

UHC: We are a multi-billion dollar company, you don't scare us!

If it’s just market cap that influences these negotiations, then United wins. They’re a $500 plus billion company, which is just wild to me, more valuable than Pfizer and Merck combined, possibly more than the Covid and cancer immunotherapy portfolios across all biopharma co’s combined. That’s nuts for a middle man to be worth that much.

Penn’s enterprise value is $30-50 billion, maybe?

I’m guessing that patients are not loyal at all to their insurance company, but rather to their doctor and their hospital, and so that’s the only thing that keeps the private insurers in line in these negotiations.

I ain’t a huge fan of either big hospital systems or big insurers. It’s too bad government incentivizes “bigger is better” and disincentivizes physician stakeholders, incentivizing MBA middle managers in some form or another. All in the name of efficiency and cost savings (what??).

 

[jondunn]

If the free standing clinic is classified as a HOPPS site it can bill at main hospital site rates. The radius for something to qualify for HOPPS is like 35 miles.

Is It Time to Reevaluate Your Off-Campus Hospital Outpatient Department Strategy? - PYA

In 2019, CMS is expanding its payment reductions to include certain services furnished in any off-campus HOPD locations—not merely non-excepted locations.

www.pyapc.com

thanks!

 

[jondunn]

If it’s just market cap that influences these negotiations, then United wins. They’re a $500 plus billion company, which is just wild to me, more valuable than Pfizer and Merck combined, possibly more than the Covid and cancer immunotherapy portfolios across all biopharma co’s combined. That’s just wild for a middle man to be worth that much.

Penn’s enterprise value is $30-50 billion, maybe?

I’m guessing that patients are not loyal at all to their insurance company, but rather to their doctor and their hospital, and so that’s the only thing that keeps the private insurers in line in these negotiations.

I ain’t a huge fan of either big hospital systems or big insurers. It’s too bad government incentivizes “bigger is better” and disincentivizes physician stakeholders, incentivizing MBA middle managers in some form or another. All in the name of efficiency and cost savings (what??).

I think there is efficiency likely (at least in terms of tests being ordered/repeated less often, faster referrals, EMR/labs in a truly closed system)- but that is eclipsed by the cost increases, which washes out the efficiency, from a society level. at an individual level is what most patients and people in general will think about though

 

[jondunn]

relevant :

 

[yesmaster]

I’ll await clinical trial enrollment numbers from COH/CTCA before congratulating their M&A team. I also wonder if teaching hospitals are taking over a lot of community hospitals just to bump clinical trial enrollment?

In other news…

“We test whether wage growth slows following employer consolidation by examining hospital mergers. We find evidence of reduced wage growth in cases where both (i) the increase in concentration induced by the merger is large and (ii) workers’ skills are industry-specific. We find that the observed patterns are unlikely to be explained by merger-related changes besides labor market power.”

Employer Consolidation and Wages: Evidence from Hospitals

Prager, Elena, and Matt Schmitt. 2021. Employer Consolidation and Wages: Evidence from Hospitals. American Economic Review. 111(2): 397-427.

www.kellogg.northwestern.edu

Source:

How Pharmacy Work Stopped Being So Great (Published 2022)

Two years of economic recovery brought strong gains to workers at the top and the bottom, but headwinds for those in between. Consider the pharmacist.

www.nytimes.com