Dr Ira Klein Discusses the Use of Fee-for-Service in Oncology

Although CMS has introduced a strict timeline to move to value-based payments, its new Oncology Care Model is partially relying on fee-for-service, and that's a good thing in the case of oncology, said Ira Klein, MD, MBA, senior director of quality, Strategic Customer Group at The Janssen Pharmaceutical Companies of Johnson & Johnson.

Transcript (slightly modified for readability)

What are your thoughts on the fact that the Oncology Care Model continues to rely on fee-for-service payment?

I think that the idea that oncology care is fee-for-service is a little bit of a misnomer. Because while it has been a system that pays oncologists a professional fee and that's volume-based—the more patients, the more professional fee that you get, and that's the same for the drugs: they buy the drugs, they keep them in the inventory and then those drugs are administered in an infusion-center environment and billed out at varying rates—that's not the fee-for-service environment that almost all other practitioners have. It's not the model of pure cognitive specialists and it's not the model of strictly procedural-oriented specialists. It's kind of a blend.

Fee-for-service in oncology was always a little bit different. And this model acknowledges that the practices need to have a revenue stream to support their infusion centers—that's part of the acces issues that need to be understood; those actions need to be financially supported. The model also acknowledges that we need to move to some value-based arrangements and that's where the monthly fee comes in—$160 per month for the duration of the episode—and the need to exchange information about the quality metrics.

So I think that this care model understands that fee-for-service was not really straightforward fee-for-service before. It actually was a blend of several services in order to support the viability of the infusion centers and so by keeping up some portion of the fee-for-service, they're continuing to acknowledge that we need those infusion centers to be available in the office setting to provide access to patients. And as we migrate portions of the entire episode over to value-based we still can't forget about paying the bills every month. And this is part of that function.