COA Practice Impact Report Details Consolidation, Shift of U.S. Cancer Care System Into More Expensive Hospital Setting

The Community Oncology Alliance (COA) has released the 2018 Community Oncology Practice Impact Report, which tracks data on the changing landscape of cancer care in the United States. It details a decade-long trend of closure and consolidation in the U.S. cancer system that has resulted in a dramatic shift of cancer care into the more expensive hospital setting. The report was released at the 2018 Community Oncology Conference.

Data from the 2018 Practice Impact Report show that, over the past decade, 1,653 community oncology clinics and/or practices have closed, been acquired by hospitals, undergone corporate mergers, or reported they are struggling financially. An average of 3.5 community oncology practices have closed per month, a rate that remains unchanged since the last report issued in 2016.

Overall, 13.8 practices per month have been affected by closings, hospital acquisitions, and corporate mergers since 2008. Specifically, the report data show:

  • 423 clinics closed
  • 658 practices were acquired by hospitals 
  • 168 practices were merged or acquired by a corporate entity
  • 359 practices were struggling financially
  • 45 practices were sending Medicare patients elsewhere for chemotherapy

“The shifting and shrinking community cancer care system reduces access to cancer care; inflates spending at the more expensive hospital setting; and is a disservice to patients, their caregivers, and support networks,” said Jeff Vacirca, MD, CEO of New York Cancer Specialists and President of COA. “Patients deserve accessible and affordable cancer care in the communities where they live and work. Community oncology practices provide that now, and they do it exceedingly well. But as long as policymakers continue to allow misguided policymaking that has the unintended consequences we see in this report, community oncology practices may not be here tomorrow to provide that kind of care.”

Changes Since Last Report

Since the last Practice Impact Report in 2016, the data show an 11.3% increase in the number of community cancer clinic closings and an 8% increase in the number of consolidations into the hospital setting. COA notes the number of practices struggling financially has declined by 7.9%, which is proportional to the number of practices that have been acquired or moved into the hospital setting. At the state level, the largest number of closures is again in Florida (47), followed by Texas (43) and Michigan (36).

Studies by Avalere, BRG, Milliman, and The Moran Group have shown both the higher cost of cancer care delivered in the hospital setting and the impact of the 340B drug discount program. It is noteworthy that despite the severe pressures facing community cancer clinics, they lead the way in enhancing the quality of cancer care and controlling costs through new care delivery models, such as the Oncology Medical Home and the Oncology Care Model.

One-Two Punch

COA notes that the trends are reflective of the push and pull of misguided public policies on cancer care. On one side, practices are facing enormous operating pressures because of the ongoing 2% sequester payment cut to Medicare enacted by the Centers for Medicare & Medicaid Services (CMS) in 2013. Many oncology practices have not survived or are struggling to survive under the sequester cut to Medicare drugs that often brings reimbursements below drug costs. In fact, COA notes that since the sequester went into effect, 135 cancer treatment clinics have closed (46.9% increase), and 189 practices (with multiple clinic locations) have been bought by hospitals (40.3% increase).

Community oncology practices also face the economic pull of the 340B Drug Discount Program, which some hospitals abuse to make tremendous profits without benefitting patients in need. Today, there is widespread, independent evidence that the 340B program is out of control, as highlighted in the findings published in The New England Journal of Medicine and an exhaustive 2-year investigation by the U.S. House Committee on Energy and Commerce. Because of the high volume of cancer drugs covered by the 340B program, hospitals have been buying up or forcing independent community cancer clinics out of business. Indeed, the 2018 COA Practice Impact Report shows that 658 practices—often comprising multiple sites—have been acquired by hospitals.

“No one can look at the Practice Impact Report trends and say that there hasn’t been a clear and negative dismantling of our cancer care system over the past decade,” said Ted Okon, Executive Director of COA. "This situation is the direct result of the misguided 340B and sequester cut allowed to take place by our elected officials in Washington. The pressures of these misguided public policies have been a one-two punch, pushing and pulling community oncology practices to close, consolidate, or be acquired by hospitals, all at the expense of patients.”

This is the seventh COA Practice Impact Report and covers activity for a 10-year period, from January 2008 through February 2018. Compiled by COA from public and private data sources, it provides a unique perspective on community oncology trends at both the national and state levels.

The content in this post has not been reviewed by the American Society of Clinical Oncology, Inc. (ASCO®) and does not necessarily reflect the ideas and opinions of ASCO®.


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