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How Do We Measure ROI for Clinical Pathways?

October 28, 2018

On the 3rd day of the 2018 Clinical Pathways Congress (October 28, 2018; Boston, MA), Ray D Page, DO, PhD, President & Director of Research, The Center for Cancer and Blood Disorders (Fort Worth, TX), tackled the challenging subject of how to define successful outcomes and demonstrate return on investment (ROI) for a clinical pathways program.

Particularly in the oncology space, clinical pathways are increasingly being used by institutions, clinicians, and commercial organizations to improve patient care by limiting undesirable variability and reducing cost while providing for the optimal course of care for a patient’s specific diagnosis.

In addition, many large payers are partnering with oncology providers and pathway companies to implement oncology pathways as a means of reducing variation and controlling costs as the US health care system shifts to value-based models. 

While acknowledging that there is not yet enough published data available on ROI and clinical pathways, he touched on many studies that do exist, which clearly demonstrate their value in reducing costs of care. One such study included 1400 patients with non-small cell lung cancer and showed that certain outpatient costs were 35% lower for those patients treated according to pathways while maintaining equivalent health outcomes (J Oncol Pract. 2010;6[1]:12-18).

Dr. Page explained pathways can also serve as a mechanism to pressure drug pricing. An ideal test case for this would be in the front-line treatment of metastatic colon cancer. The CALGB/SWOG 80405 study has shown equivalent efficacy and toxicity between chemotherapy plus bevacizumab and chemotherapy plus cetuximab, yet the cetuximab arm costs $40,000 more for a treatment course. Thus, in a properly designed, value-based pathway, the pathway would give clear preference to bevacizumab and only allow cetuximab in circumstances where bevacizumab is contraindicated (eg, uncontrolled hypertension or a significant history of arterial thrombotic events). If drug costs and efficacy are presented at the point of care explicitly and transparently, manufacturers would be incentivized to bring drug costs closer to parity.

There is also potential for pathways to assist in one of the main burdens physicians complain of that wastes working hours: prior authorization. For utilization management (UM), many payers use pathways-based decision-support tools, like eviCore, which drives prior authorization criteria (which are not transparent at all) and advises insurers not to pay, based on stringent 100% compliance with their “pathways.” This results in major conflict with physician decision-making. A potential solution is to use provider-facing pathways with robust reporting of pathway compliance (80%) as a mechanism for prior authorization relief and shared savings.

Despite their relatively short time of existence, there is already mounting evidence that oncology pathways can decrease spending related to chemotherapy patients. A study by Blue Cross Blue Shield found potential systemwide savings of more than $30 million through the use of pathways. In a project involving more than 4700 patients with cancer at more than 46 sites, drug costs at sites adhering to clinical pathways were found to be 13% lower ($2,440 per patient) than at sites that were not adherent (J Oncol Pract. 2013;9[5]:e241-e247).

In terms of costs to implement a pathway program, Dr. Page said costs are highly variable, depending on staff size, location, practice environment, and vendor relationships, but it can range anywhere between $3,000-$10,000 per FTE physician per year. Unexpected costs would include IT costs, EHR vendor costs with interphases, and negative staff productivity costs if the pathways system is not fully efficient and integrated.

In this time of shrinking budgets and less discretionary income, ROI is a necessary consideration in practice management strategies and budget planning. Typically, ROI is calculated in terms of financial gain beyond the original investment over a defined time period. However, the ROI of oncology clinical pathways, in principle, should extend beyond financial consideration and be calculated in terms of patient-centered ROI. Stated differently, pathways may have extra financial value that is not ordinarily reflected in conventional financial accounting statements.

Pathways may realize tremendous benefits by improving performance, measured as the increase in the quality of care, efficient use of resources, and better outcomes. This translates into better patient outcomes, which, in turn, favorably impact practices financially under new value-driven payments that will come from MACRA legislation.—Amanda Del Signore

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