Researchers track spending by commercial insurers on infused chemotherapy

Infused chemotherapy is associated with lower costs for commercial insurance providers when administered at a physician’s office compared to a hospital outpatient department (HOPD), according to a new study published in JAMA Oncology.

The study addressed questions raised by current reimbursement polices being practiced by insurers throughout the United States.

“While patients may receive the same treatment in either setting, insurers typically reimburse payments to HOPDs at a higher rate than to physician offices,” wrote lead author Aaron N. Winn, PhD, of the Medical College of Wisconsin in Milwaukee, and colleagues. “Hospitals justify this payment difference because they incur higher overhead costs and treat more medically complex patient populations. Critics argue that the value of the services provided, rather than overhead expenses, should determine prices.”

Winn et al. studied data from more than 283,000 patients who initiated treatment with infused chemotherapy from 2004-2014. Spending was examined in three different ways: line item drug level, the sum of all expenditures on the day of treatment and the sum of reimbursements for all services received within 6 months after treatment. Overall, spending was lower in physician offices at the line item drug level ($1,466 versus $3,799), the day level ($3,502 versus $7,973) and the six-month level ($43,700 versus $84,660).

The study also found that 6 percent of patients received their treatment in a HOPD in 2004, a number that jumped all the way to 43 percent in 2014.

“Potential targets for reduction of excess spending and creation of a more efficient health care system can come from private insurers following Medicare’s lead, which has started to equalize payments across sites of care,” the authors concluded.