As a practicing physician for decades, I welcome the opportunity to help improve the quality of life for individual patients. Now, as a physician executive for Highmark, a Pennsylvania-based health insurer, I am able to touch thousands of patients’ lives by helping affect the quality and cost of their care and creating more value for the dollars they spend on health care. Scanning today’s health care landscape though, I’m troubled that the cost of care doesn’t correlate to the quality of care patients are receiving.  Consumers can be served better.

Higher-quality care can cost less if processes are streamlined, recommended care pathways are followed, financial incentives are aligned and pricing is rational. While problems with poor quality and excessive cost abound, there are viable solutions on the table that have proven successful.

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I am particularly alarmed by the irrational pricing of oncology care.  Recent reports concerning the inexplicable cost of oncology drugs and its impact on patients and employers have caught our attention at Highmark and we are taking measures to make sure our members battling cancer don’t pay more than they should have to for their treatment. We can save millions of dollars for members without compromising their care.

During the past several years, many cancer patients in our region – and across the country – have been paying much more for their infusion chemotherapy treatment than they should. Why?

Nationwide, there have been trends in which health systems change their billing practices so chemotherapy treatment is billed as a higher-cost hospital outpatient service even though treatment continues to be administered in the same setting — a physician’s office.  As a result, these distorted billing practices are costing tens of millions of dollars in excess of what was paid previously without additional clinical benefit. It’s not right, and it needs to change.

For example, in our region, we’ve learned that for one specific patient, the cost of treatment increased from $10,000 to $32,000 and that the patient’s portion of that bill increased from $1,000 to $3,200 without any change in the physical location of the infusion and no change in the drug used.

Such irrational billing practices can be found in health-care settings across the country.  In fact, a 2013 report from the Medicare Payment Advisory Commission pointed out that Medicare payments in 2011 were $1.5 billion higher for physician office visits and echocardiograms when services were billed as hospital outpatient services even when they were delivered in a physician’s office.

In response to these practices, patients, public officials and the public at-large have been adamant that health insurers such as Highmark address these costly billing practices while also maintaining high-quality care.

To address these concerns, last year Highmark put in place policies to eliminate the financial incentive of these practices, therefore reducing unnecessary spending for our members. We estimate that these actions are saving an estimated $200 million annually without limiting access to appropriate chemotherapy and without compromising quality of patient care.

The change to an infusion-fee schedule does not mean a change in covered services; we continue to reimburse providers for ambulatory oncology-related services performed at hospital outpatient facilities, including the administration of oncology drugs, but we will no longer tolerate changing the price of the oncology drug based on the setting of care.

This step is an important one to begin correcting inequitable and artificial billing procedures. We intend to continue to move toward aligning incentives so that we will reimburse physicians more for better outcomes and higher patient satisfaction, rather than simply paying for delivering more services or for changing provider billing practices to increase revenue. Forward-thinking physicians understand this is the right thing to do for the health and well-being of patients and the community at-large.  We encourage others to do the same.

Just as we on the private side have taken strong measures to correct this problem, we urge Congress to strongly consider similar reforms to neutralize payments across sites of service as a common sense way to protect patients and the Medicare program’s finances without jeopardizing care.   

Donald R. Fischer, writing on behalf of the Alliance for Site-Neutral Payment Reform, is a pediatric cardiologist and chief medical officer for Highmark Blue Cross Blue Shield.