Costs, Charges and Reimbursements in BMT:

Is there any Good News for the Future???

John Kersey MD

2009 ASBMT Corporate Council Meeting

• Status of Health Care Reform in the US– Will insurance coverage be mandatory??

• Massachusetts “Romneycare” as model

– Insurance Exchanges?– Increase in government as payor (Medicaid and

Medicare)?– What about reimbursement limits?

• My 2009 predictions vs reality

2011 Phoenix Meeting

• Reimbursements– Changing Payer Mix– Reimbursements for Clinical research

• Dr. Keith Sullivan

• Costs– Current Inpatient Costs

• How will we reduce costs in the face of decreasing reimbursements??

Payer Mix in Minnesota BMT Program in 2010

Medicaid Medicare Non-government

Pediatric 20% 2% 78%, largest Blue Cross

Adult 16% 16% 68%, largest Optum/URN

Increase in Medicaid patients in Minnesota BMT Program in 2010

• We had 34 vs 21 average in previous years–A significant increase compared to the

2007-2009 period

Government Payors

• Medicare, Medicaid and other government-sponsored programs – Pay a predetermined, fixed rate (e.g. DRG) for

inpatient services and a fee schedule for outpatient and physician services

– Payment rates are usually low and often below cost

– EXPECTATION FOR GOVERNMENT PROGRAMS (ESPECIALLY MEDICAID) TO INCREASE UNDER AFFORDABLE HEALTH CARE ACT Of 2010(OBAMACARE)

Reimbursement Issues

• Medicaid cases are increasing relative to commercial payers in part due to unemployment and the economy

• Medicaid reimbursements are as low as 10% in some states

• Network participation of BMT programs increases reimbursements

• National organizations (such as OptumHealth and Life link) are increasing used by insurers for payment and eligibility issues

_____________________• Payers have difficulty risk-adjusting reimbursements

BMT Programs have relied on Commercial Payers to Maintain Margins

• Blue Cross, Aetna and other contracted payers– Designated transplant centers networks in their

network– Case rates and days covered in the global period are

different in every contract– BMT centers must rely on “outlier reimbursements”

maintain margins

When reimbursements fall, how do we reduce costs to maintain margins?

Minnesota Study of Cost of Adult BMT

Majhail/ Weisdorf Biol.Blood Marrow Transplant 2009:15,84

• Consecutive adult (≥18 years) allogeneic BMT recipients (2004-2006)

–294 patients

Four groups of patients in Minnesota Cost Study

• Myeloablative Matched Related Donors (MA MRD• Myeloablative Umbilical Cord Blood (MA UCB)• Non-myeloablative Matched Related Donors (NMA

MRD)• Non-myeloablative Umbilical Cord Blood (NMA

UCB)

Multivariate Analysis for SurvivalVariablesa Relative-risk

(95% confidence intervals)

P-value

Transplant type

MA MRD 1.0 0.59

MA UCB 1.1 (0.7-1.6) 0.85

NMA MRD 0.8 (0.5-1.2) 0.21

NMA UCB 1.0 (0.6-1.5) 0.98

Graft failure

No 1.0 <0.001

Yes 3.6 (2.2-5.9)

Dialysis

No 1.0 0.001

Yes 2.1 (1.4-3.3)

Mechanical ventilation

No 1.0 <0.001

Yes 4.4 (3.1-6.2)aOther variables considered in the model included age at transplantation, gender, KPS score, disease risk, history of

previous transplant, CMV status, HLA match, graft source, acute GVHD and occurrence of hepatic VOD

Methods: Cost Information

• Obtained cost info from day -30 through day +100– Both direct and indirect costs– Cost categories:

• Graft acquisition• Laboratory services• Radiological investigations• Pharmacy services• Room and board• Blood components• Other services

– Information not available for:• Physician charges• Patient intangible costs

Costs Higher in Myeloablative and MRD cases

• Total costs by conditioning (first 100 days)– MA HCT = $137,112– NMA HCT = $84,824– P<0.001

• Total costs by graft source– UCB HCT = $137,564– MRD HCT = $83,583– P<0.001

Cost PredictorsVariablesa,b Relative-risk

(95% confidence intervals)

P-value

Transplant type MA MRD 1.0

MA UCB 1.3 (1.1-1.5) 0.05

NMA MRD 1.0 (0.9-1.2) 0.82

NMA UCB 1.0 (0.8-1.2) 0.96

Graft failure No 1.0

Yes 1.8 (1.7-1.9) <0.001

Dialysis No 1.0

Yes 1.3 (1.1-1.5) 0.05

Mechanical ventilation

No 1.0

Yes 1.3 (1.2-1.4) 0.004

Hospital stay, tertilesc <32 days 1.0

32-48 days 1.0 (0.8-1.2) 0.98

>48 days 2.1 (1.9-2.3) <0.001a Other variables considered: age, KPS score, disease risk, previous transplant, CMV status,

acute GVHD, hepatic VOD and total medical encounters in days (by tertiles)b Excluding costs of graft acquisitionc Total hospital stay in first 100 days post-transplantation

0

250

500

750

1000

1250

1500

1750

2000

2250

MA MRD MA UCB NMA MRD NMA UCB

Medi

an C

ost

Per

Day

Sur

vive

d, $

Other

Radiology

Blood components

Laboratory

Pharmacy

Room/Board

33%

32%

4%11%

18%

2%

31%

30%

5%

14%

17%

2%

40%

27%

6%

13%

12%

3%

38%

36%

11%

3% 7%5%

$1023

$2082

$612

$1156

Costs Per Day Survived

Conclusions from Minnesota Study

• Umbilical Cord Blood transplants are available to patients lacking a matched related donor.

– However, costs are higher than matched related donor transplants (both myeloablative and nonmyeloablative)

• Severe post-transplant complications and prolonged hospital stay are critical determinants of cost

What’s Next? How will we reduce costs?

• Standardization of protocols is likely to be the most important–Avoid non-proven labs and

radiology–Reduce pharmacy, hospital stay–More research protocols designed

to reduce complications

Costs, Charges and Reimbursements in BMT:

Is there some good news for the future???

Yes, our field has high costs but costs will be (hopefully rationally) reduced

based on: a) standardized protocols b) research progress