7 Threats to Cancer Care

Gabriel Miller; Peter P. Yu, MD; Jennie R. Crews, MD; Matthew Farber


September 10, 2014

In This Article

Financial Pressure on Oncology Practices

Key Facts:

In ASCO's second annual census of US oncology practices,[3] conducted in 2013, practices cited financial pressures as the greatest threat to their ability to continue providing high-quality care, with significant numbers saying they are cutting back on support staff or clinical research, or are sending patients to hospitals to receive chemotherapy.

24.2% and 21.2% of oncology practices cited cost pressure and payer pressure, respectively, as the most significant environmental pressure they faced.

Dr. Yu: Twice in my career, in December, I was in a practice where we didn't have any money left over to pay the doctors. We paid our staff, which we were thankful for; we paid our mortgage payments, we paid our electric bill, we paid our malpractice insurance. We paid everybody who we owed money to, and there was no paycheck. There was no money in December so it was a pretty bleak Christmas. I've seen that twice in about 25 years, and each time we survived. We changed. The first time we went from being a small practice of six doctors to joining a much larger practice that had better contracting and more efficiencies. We looked at what needed to be done to survive and that was to join another practice.

The second time it was a decision to link up with our hospital and try to create a more comprehensive network. We went that route, and then after two years we decided that this was not going to work out and we needed a divorce. That happened at the end of the year, and we started January 1 with a few thousand dollars in the bank. We had to start out with a whole new practice, and at that point it was with over 100 doctors starting off. The way it is in medicine right now, you are one heartbeat away from going bankrupt. It just takes one bad decision, or maybe even the right business decision that goes bad, and you are in bankruptcy.

Dr. Crews: In the region in which I practice, we are in the second tier of mergers. About five years ago, practices here were being purchased by hospitals or were merged with hospitals. Now what we're seeing is that smaller hospitals with cancer programs are merging with larger hospitals, so we're having the second tier of consolidation within this region. I think there's good and bad in that. The good is that by merging with a larger entity, many times those smaller hospitals can stay in business and can continue to deliver cancer care in that community. It actually may be a good thing for the patients in the rural areas here. One of the benefits of hospital-based practices is the huge resource allocation that they have for cancer care. For example, I'm part of a hospital-based cancer center, and we have a lot of support services for patients such as navigators, social workers, chaplaincy service, support groups, and dietitians. Not all of these are necessarily revenue-generating services, but because of the resources of a larger institution, we're able to provide these for patients. Quality doesn't have to be compromised as a result of these mergers.

Mr. Farber: I do not believe that this is a death knell for oncology practice. There are some very strong practices out there that are doing some very innovative things and are doing a very fine job of not only surviving, but thriving honestly and doing well in their geographic area, in their niche. They see no need or reason to sell or merge with a hospital at any point in the near future. There are plenty of those practices out there, and they can certainly be looked at to show other folks that there are methods for remaining a strong practice financially.

I was talking to an [ACCC] member recently who said that a hospital is trying every method it can to buy out his practice, but the practice group just does not want to merge with the hospital. They think it is bad for their docs and bad for their patients -- bad all around. But at the same time, you do have some docs who, for some of the reasons I talked about earlier -- can't find the partners to buy up their share of the practice or are just sick of being burned on one too many patient copays of expensive drugs. Or the 60-day turnaround from the local Medicare contractor is just such a headache from a cashflow perspective, or keeping the lights on and paying the employees has become too much of a challenge. Those are the cases where you have the practice saying, "You know what? It's better off for everyone involved to just do this."


Comments on Medscape are moderated and should be professional in tone and on topic. You must declare any conflicts of interest related to your comments and responses. Please see our Commenting Guide for further information. We reserve the right to remove posts at our sole discretion.