The National Practice Benchmark for Oncology, 2014 Report on 2013 Data

Transcription

1 Special Series: State of Oncology Practice Original Contribution The National Practice Benchmark for Oncology, 214 Report on 213 Data By Elaine L. Towle, CMPE, Thomas R. Barr, MBA, and James L. Senese, MS, RPh Oncology Metrics, a division of Flatiron Health, New York, NY Abstract The National Practice Benchmark (NPB) is a unique tool to measure oncology practices against others across the country in a way that allows meaningful comparisons despite differences in practice size or setting. In today s economic environment every oncology practice, regardless of business structure or affiliation, should be able to produce, monitor, and benchmark basic metrics to meet current business pressures for increased efficiency and efficacy of care. Although we recognize that the NPB survey results do not capture the experience of all oncology practices, practices that can and do participate demonstrate exceptional managerial capability, and this year those practices are recognized for their participation. In this report, we continue to emphasize the methodology introduced last year in which we reported medical revenue net of the cost of the drugs as net medical revenue for the hematology/ oncology product line. The effect of this is to capture only the gross margin attributable to drugs as revenue. New this year, we introduce six measures of clinical data density and expand the radiation oncology benchmarks. Introduction Benchmarking is one of the best, most efficient ways to find opportunities to improve your practice and then monitor progress after corrective action is taken. The National Practice Benchmark (NPB) was developed by Oncology Metrics, a division of Flatiron Health, a team of professionals with many years of experience in oncology practice, surveys, and benchmarking and provides important and meaningful data for oncology practices to use for managing in today s challenging practice environment. As discussed in last year s survey report, 1 we recognize that the NPB survey results do not capture the experience of all oncology practices. Practices that can and do participate, however, demonstrate exceptional managerial capability. We characterize these successful survey participants as exemplary practices and the benchmarks as characteristic of well-managed clinical businesses. To increase the vigor of the survey results, this year we instituted eligibility criteria for participation. Practices were required to provide specific data elements for calendar year 213 or their most recently completed 12-month fiscal year. These core data points included number of full-time equivalent (FTE) physicians, total work relative value units (wrvu), number of new patients, number of patient visits, cost of goods paid for (COGPF; also known as cost of drugs), and total drug revenue. We recognize that hospital-based and academic practices may not have access to cost of goods or drug revenue. To encourage their continued participation, they were able to pass on providing those two data elements and invited to complete the rest of the survey. Successful NPB participants are now recognized for their accomplishment. Both the individuals who successfully completed the survey and their practices have received certificates recognizing their participation. We believe that NPB participants who are able to provide complete and accurate data are among the best managed practices in the country. The ability of these practices to count what counts to keep their practices running efficiently distinguishes them as elite. These 59 successful participants are presented in Table 1, and their data are included in the analytic data set. As you use these benchmarks in your own practice, remember that average in this group is very good indeed. Methodology Approximately 1,5 medical oncologists, practice administrators, and other key staff members from more than 9 practices and institutions across the country were invited to participate in the 214 survey. Participants were contacted via , and the survey was completed entirely online. Practices were instructed to submit only one survey per practice; multiple results from the same practice were deleted. Successful survey participants received a full survey report as well as a practice-specific benchmarking analysis. The NPB survey collects data for a 12-month period. To be included in the analytic data set, practices were required to complete the core elements mentioned previously but not required to answer all questions; data from incomplete surveys is included in the final survey results. The analytic data set includes 59 practices with 552 FTE hematology/oncology (HemOnc) physicians and FTE physicians in all specialties. When core data were missing, nonsensical, or internally inconsistent, practices were excluded from the analytic data set. All responding practices are included in the demographics data. Data were submitted by HemOnc single-specialty practices as well as by multispecialty practices, hospital-based practices, and other institutions. Survey questions specified whether data should be reported for the HemOnc division of the practice, all departments/specialties of the practice or the radiation oncology (RadOnc) di- Copyright 214 by American Society of Clinical Oncology NOVEMBER 214 jop.ascopubs.org 385 Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

2 Towle, Barr, and Senese Table 1. Successful Survey Participants Participant Title Practice State Maggy Pons Executive Director Advanced Medical Specialties FL Steve Bainaka Executive Director AHN Oncology IN Rob Leitz Practice Director Arizona Oncology Associates-Phoenix Division AZ Kim Roddy Practice Administrator/Office Manager Associates in Oncology/Hematology MD Katey O Neal Senior Financial Analyst Austin Cancer Centers TX Bradley Ekstrand Physician California Cancer Care CA Cindy Powers Director of Finance and Reimbursement Cancer & Hematology Centers of Western Michigan MI Bill Fisher Chief Financial Officer Cancer Care Northwest WA Kathy Dubach Billing Manager Cancer Health Treatment Centers, PC IN Ricky Newton Practice Administrator Cancer Specialists of Tidewater VA David Wheeler Financial Officer Center for Cancer and Blood Disorders TX David Halvorsen Practice Administrator/Office Manager Central Park Hematology & Oncology NY Ruth Lander Practice Administrator Columbus Oncology and Hematology Associates OH Jack Baker Chief Financial Officer Commonwealth Hematology Oncology, PC MA Robert Baird Chief Executive Officer Dayton Physicians Network OH Richard Roth Chief Executive Officer Epic Care CA Daniel Konow Chief Executive Officer/Executive Director Fort Wayne Medical Oncology and Hematology IN Glenn Davis Operations Manager, Oncology Hallmark Health System MA Vaughn Skinner Practice Administrator/Office Manager Hematology & Oncology Associates of Alabama AL Kristin Avila Office Manager Humboldt Medical Specialists CA Kim Algrim Controller Hutchinson Clinic, PA KS Anne Pirhoda Practice Administrator/Office Manager IHA Hematology Oncology Consultants MI Michael Voeller Chief Financial Officer Illinois CancerCare, PC IL Anitha Reddi Director of Clinical Operations Inland Valley Hematology Oncology Associates CA Elizabeth Mueller Administrator Ironwood Physicians, PC AZ Sujay Karvekar Assistant Administrator JOHA/PRCC IL Robert Orzechowski Chief Operating Officer Lancaster Cancer Center PA James Tucker Chief Executive Officer/Executive Director Low Country Cancer Care GA Isabella Bouffard Director of Finance/Chief Financial Officer Maine Center for Cancer Medicine ME Mike Boardley Director of Finance/Chief Financial Officer Michiana Hematology Oncology IN Ted Bjork Chief Financial Officer Minnesota Oncology MN Julie Nickerson Director of Finance/Chief Financial Officer New Mexico Oncology Hematology Consultants NM Nina Arndt Practice Administrator Northwest Oncology & Hematology, SC IL Alti Rashman Practice Administrator Oncology Consultants, PA TX Rich Norris Practice Administrator/Office Manager Oncology Hematology Associates IN Steve Schrader Chief Financial Officer Oncology Hematology Care OH Valeria Wareham Executive Director Pacific Cancer Care CA Sadiaka Joarder Practice Administrator/Office Manager Queens Medical Associates NY Robert Richards Chief Executive Officer/Executive Director RCCA Cherry Hill NJ Eileen Peng Practice Administrator/Office Manager Regional Cancer Care Associates-Central Jersey Division NJ Mary Lois Moss Practice Administrator Regional Hematology and Oncology, PA DE Jennifer Headen Practice Administrator/Office Manager Rex Cancer Center NC Lan Ngo Practice Manager Santa Monica Hematology Oncology Consultants CA Tara Lock Director of Oncology Operations Southcoast Centers for Cancer Care MA Todd O Connell Executive Director Southeast Nebraska Cancer Center NE Sarah Cowart Practice Manager Southern Oncology Specialists NC Nancy Payne Executive Director Space Coast Medical Associates FL Bill Alexander Chief Executive Officer/Executive Director Tennessee Oncology TN Lisa Sanderson Practice Administrator/Office Manager The Cancer Center of Huntsville AL Stephen East Practice Administrator/Office Manager The Medical Oncology Group, PA MS continued on next page 386 JOURNAL OF ONCOLOGY PRACTICE VOL. 1, ISSUE 6 Copyright 214 by American Society of Clinical Oncology Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

3 National Practice Benchmark, 214 Report on 213 Data Table 1. (continued) Participant Title Practice State Ronald Davis Director of Finance/Chief Financial Officer The West Clinic TN Peggy Barton Practice Administrator Toledo Clinic Cancer Centers OH Ruth Settle Practice Administrator Tri-County Hematology & Oncology OH Mike Yates Director of Finance/Chief Financial Officer Tulsa Cancer Institute OK Gary Glissman Chief Operations Officer Urology Cancer Center and GU Research Network NE Walt Moyer Chief Executive Officer Utah Cancer Specialists UT Crystal Farrimond Administrative Director Utica Park Clinic Oncology OK Sherry Hirst Chief Financial Officer West Michigan Cancer Center MI Steve Lech Consultant West Penn Allegheny Oncology Network PA vision. Most but not all of the data in this report are focused on HemOnc. We have indicated in the results when that is not the case. Calculations Using the Benchmarks Most of the benchmarks presented in this year s report include the number of practices responding and the number of denominator units. You will notice that these numbers vary by benchmark. This variation reflects the presence or absence of usable data in the computation as mentioned previously. Given that the data contributors are not consistent across the benchmarks, we caution readers not to combine various benchmarks to derive secondary or aggregated new metrics. The denominator for many of the benchmarks in this report is the number of standard (STD) HemOnc physicians calculated on the basis of wrvu with 7, wrvu per year as the productive capacity of an physician. We also report the number FTE physicians represented in the data. This may be reported as physicians, FTE RadOnc physicians, or FTE physicians (indicating all physicians in the practice regardless of specialty). When used in the aggregate, there are often only slight differences between the results expressed per physician or per physician; these two measures are derived from the same aggregated data in which the number of new patients and the amount of wrvu is strongly correlated. When applying any individual benchmark to an individual practice, we encourage the conversion of the physician count for the practice to physician and suggest using that as the basis for comparison. This provides useful comparisons for both busy practices and those that are less busy. A limited number of benchmarks are also reported per FTE physician. This is intended to provide multispecialty practices with options as they review these data and apply them to their work environment. Similarly, we use STD for the productive capacity of a Rad- Onc physician. We define an STD RadOnc physician as one with 26 average daily treatments (based on 254 working days per year). We also report the number of FTE RadOnc physicians for many of the radiation benchmarks. Net Revenue and Net Drug Revenue This report continues the methodology from the previous 2 years 2,3 and reports many of the financial metrics net of the COGPF. Key among those metrics are net medical revenue (total medical revenue less COGPF) and net drug revenue (total drug revenue less COGPF). The effect of this is to capture only the gross margin attributable to drugs as revenue. We encourage all who use these survey results to be aware of this change in perspective. The cost of drugs must be subtracted from top line gross revenue to accurately understand the revenue structure of the practice. It is misleading and a gross distortion of medical oncology practice economics to report total revenue other than as net of the cost of drugs. Do not do that, ever. Confidentiality Oncology Metrics is committed to protecting the confidentiality of individual practice data and makes the following data commitment to NPB participants: All of the individual data that you provide in the survey is absolutely confidential and will never be disclosed. Access to the data file that Oncology Metrics creates from this survey will never be made available to any party. Oncology Metrics will create analytic reports including aggregated data from this survey, but will always publish in a manner that completely obscures the source of the data so that no reader can make any supported inference of data to any individual practice. Understanding the NPB Report NPB data are presented in an easy-to-understand format using pie charts and bar graphs. Data are generally presented in vertical bar graphs using 25 th percentile, 5 th percentile (or median), adjusted average, average, and 75 th percentile. The adjusted average is the average calculated without the highest and lowest values. While in most cases this does not dramatically alter the resulting benchmark, there are some where it makes a material difference. Including the adjusted average allows us to responsibly include more data contributors while still offering our best efforts to keep the underlying data credible. When interpreting this survey data, remember that a percentile is a point on a scale below which a certain percent of responses fall. For example, the 75 th percentile is the point in a distribution of data below which 75% of responses fall. Likewise, the 25 th percentile is the point below which 25% of responses fall. Note that a percentile may or may not correspond Copyright 214 by American Society of Clinical Oncology NOVEMBER 214 jop.ascopubs.org 387 Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

4 Towle, Barr, and Senese to a value judgment about whether it is favorable or unfavorable. The interpretation of whether a certain percentile is favorable or unfavorable depends on the context to which the data apply. In some situations, a low percentile would be considered favorable: for example, number of days sales outstanding. In other contexts, a high percentile might be considered favorable, such as the number of new patients per physician. Our goal in producing and presenting this report continues to be to provide readers with a valuable tool to evaluate and manage one s own practice in today s complex health care environment. We encourage all oncology practices to review the data provided and use them as appropriate for managing today s oncology practice. No. of Responses Physician- Owned Practice Respondents Other Hospital- Owned Practice No. of Results Respondent Demographics Survey responses were submitted from 87 practices in 34 states. Respondents identified their roles in the practice as practice administrator/office manager (48% of respondents), physician (4%), chief financial officer/director of finance (15%), chief executive officer/executive director (17%), chief operations officer/director of operations (6%), billing manager (3%), and other (7%). Respondents from 81 practices reported an average of 8.9 physicians per practice, up from 7.3 last year. For the purposes of the survey, an physician is defined as one who spends four full days in clinic seeing patients and part of the fifth day on clinic business and one who shares call equally with other physicians. Practices were identified by the number of physicians (Fig 1). Thirtyseven percent of survey respondents were from practices with one to five physicians, down from 5% in last year s survey. The demographics data include a total of 712 physicians and 916 FTE physicians in all specialties. The majority of survey respondents described their current business structure (Fig 2) as physician-owned practice (83%). A structure of hospital-owned practice was reported by 9% of respondents, and the remaining 8% reported other, which 17% 1% 29% 7% 37% No response 1-5 > 5-1 > 1-16 > 16 Figure 1. Practice size according to number of full-time equivalent (FTE) hematology/oncology (HemOnc) physicians. (practices, 81; FTE HemOnc physicians, 712). Figure 2. Business structure according to number of practices and number of standard (STD) hematology/oncology (HemOnc) physicians (practices, 87; physicians, 737.5). Medical oncology, including infusion Hematology Laboratory Clinical trials Imaging Radiation oncology Closed-door/ retail pharmacy GYN oncology Genetic counseling Psychosocial support Other Surgical oncology, other than GYN oncology Medical oncology (professional services only, no infusion) No. of Figure 3. Services provided by practice according to number of standard (STD) hematology/oncology (HemOnc) physicians (practices, 87; physicians, 737.5). GYN, gynecologic. included a freestanding cancer center owned jointly by two hospitals; a nonprofit multispecialty medical group; and a medical foundation model. Figure 3 shows the services provided by the reporting practices according to the number of STD Hem- Onc physicians. Pharmacy Operations This year s survey included a series of questions about oral drugs, the role of specialty pharmacy in the practice, and physician dispensing all important topics for oncology practices today. Respondents were asked to report the typical distribution channel for all oral drugs prescribed by the clinicians in their practice (Fig 4). Respondents were then asked whether they are provided with timely feedback on clinical support services for prescriptions filled via specialty or mail-order pharmacy. Slightly less than half (47%) of respondents said yes. Figure 5 shows how practices rated their experience with clini- 388 JOURNAL OF ONCOLOGY PRACTICE VOL. 1, ISSUE 6 Copyright 214 by American Society of Clinical Oncology Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

5 National Practice Benchmark, 214 Report on 213 Data No. of No. of Yes No Practice- Owned/ Affiliated Closed- Door/Retail Pharmacy Practice- Owned/ Affiliated Dispensing Unit Nonpractice- Affiliated Retail Pharmacy Specialty Pharmacy/ Mail-Order Pharmacy Figure 4. Oral drug distribution channel (practices, 78; standard [STD] hematology/oncology [HemOnc] physicians, Respondents (%) Excellent Good Not known Okay Poor Patient Drug Education Adherence Oversight, Timely Refills Adverse Effects, Adverse Event Managment Figure 5. Experience with clinical support services provided by specialty/mail-order pharmacy (practices, 79). Closed-Door/ Retail Pharmacy Dispensing Unit Figure 6. Responses to survey questions Do you dispense any medications to your patients via a closed-door/retail pharmacy? and Do you dispense any medications to your patients via a dispensing unit? (practices, 67; standard [STD] hematology/oncology [HemOnc] physicians, 692). cal support services in three major categories. Practices were asked about the average amount of time required to complete all necessary communications with specialty/mail-order pharmacies; 6% said less than 15 minutes, 28% said greater than 15 minutes and less than 3 minutes, 3% greater than 3 minutes and less than 1 hour, and 36% said greater than 1 hour. A follow-up question asked how much time various categories of staff spent on this task, and the results showed that nurses spent 44% of their time, pharmacists 14%, physicians 7%, and others (defined as administrators, business offices, or other support staff) 35%. Last in this section, the survey asked about point-of-care drug dispensing, specifically closed-door/retail pharmacy and physician dispensing units (Fig 6). A closed-door/retail pharmacy is defined as a licensed entity that provides pharmacy services to patients and employees of the practice but is not available to the public at large (note: not all states allow this practice). A physician dispensing unit is defined as a nonlicensed entity, which allows physicians to stock and dispense medications (generally oral) to patients of the practice. Throughout the survey, we draw distinctions between point-ofcare dispensing pharmacy and the infusion pharmacy operations in the practice. Physician Productivity The analytic data set begins with physician productivity. This data set includes 59 practices with 552 physicians and FTE physicians in all specialties. Physician productivity is reported and measured several ways: number of new patients per physician per year; wrvu per physician per year; and visit counts for established patient visits in both the office and the hospital. New patient volume is still an important measure of productivity and an essential tool for practice planning. Survey respondents reported the number of new patients for HemOnc that entered the practice in the 12-month period in both the office and inpatient hospital settings (Fig 7). A new patient is defined as one who has not received services from a clinician in the exact same specialty in the practice in the last 3 years. wrvu is also used to measure physician productivity and is the measure of the physician work component that is assigned to each procedure code in the Resource-Based Relative Value System, the system used by the Centers of Medicare and Medicaid Services and most other payers to assign reimbursement amounts to procedure codes. Productivity measured using wrvu is a valuable management tool for oncology practices. Figure 8 shows wrvu per physician and includes all services and settings (evaluation and management [E/M] services, procedures, and chemotherapy administration in the office and the hospital) for which wrvu applies. In addition to total wrvu, we also report wrvu for selected groups of services. Figure 9 shows wrvu net of incident to services that is, any wrvu for services rendered incident to the physician service (not performed directly by the physician) Copyright 214 by American Society of Clinical Oncology NOVEMBER 214 jop.ascopubs.org 389 Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

6 Towle, Barr, and Senese No. of New Patients Office Hospital wrvu 7, 6, 5, 4, 3, 2, 1, 5th 5th Figure 7. Number of new hematology/oncology (HemOnc) patients in the 12-month period per standard (STD) HemOnc physician (practices, 56; physicians, 581.7). wrvu 1, 9, 8, 7, 6, 5, 4, 3, 2, 1, 5th Figure 8. Work relative value unit (wrvu) per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 56; physicians, 537.1). 8, 7, 6, Figure 1. Work relative value unit (wrvu) for evaluation and management and infusion services in the office setting per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 55; FTE HemOnc physicians, 58.8) and standard (STD) HemOnc physician (practices, 54; physicians, 551.3). wrvu 9, 8, 7, 6, 5, 4, 3, 2, 1, 5th Figure 11. Work relative value unit (wrvu) for evaluation and management services in the office and hospital setting per full-time equivalent (FTE) hematology/oncology (HemOnc) physician and standard (STD) HemOnc physician (practices, 56; physicians, 537.1; physicians, 581.7). wrvu 5, 4, 3, 2, 2,5 2, 1, 5th wrvu 1,5 1, Figure 9. Work relative value unit (wrvu) net incident to services per full-time equivalent (FTE) hematology/oncology (HemOnc) physician and standard (STD) HemOnc physician (practices, 32; physicians, 344.2; physicians, 373.8). 5 5th is subtracted from the total wrvu. It is interesting to note that, although 56 practices were able to report total wrvu (up from 42 last year), only 32 practices reported wrvu net incident. Figure 1 shows wrvu for services in the office setting only Figure 12. Work relative value unit (wrvu) for evaluation and management services in the hospital setting per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 56; physicians, 58.8) and standard (STD) HemOnc physician (practices, 54; physicians, 551.3). 39 JOURNAL OF ONCOLOGY PRACTICE VOL. 1, ISSUE 6 Copyright 214 by American Society of Clinical Oncology Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

7 National Practice Benchmark, 214 Report on 213 Data Capacity Ratio Expense ($) 8,, 7,, 6,, 5,, 4,, 3,, 2,, FTE physician.2 1,, 5th 5th Figure 13. Hematology/oncology (HemOnc) capacity ratio (practices, 56; full-time equivalent HemOnc physicians, 537.1). No. of Established Patient Visits 4, 3,5 3, 2,5 2, 1,5 1, 5 5th Figure 14. Established patient office visits per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 57; physicians, 521.7) and standard (STD) HemOnc physician (practices, 54; physicians, 551.3). No. of Established Patient Visits 1,2 1, th Figure 16. Total practice expense per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 53; physicians, 53.9), standard (STD) HemOnc physician (practices, 5; STD HemOnc physicians, 533.5) and FTE physician (practices, 53; FTE physicians, 619.1). COGPF ($) 4,, 3,5, 3,, 2,5, 2,, 1,5, 1,, 5, 5th Figure 17. Cost of goods paid for (COGPF) per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 54; FTE HemOnc physicians, 526.1) and standard (STD) HemOnc physician (practices, 51; physicians, 555.8). Expense ($) 3,, 2,5, 2,, 1,5, 1,, Figure 15. Established patient hospital visits per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 57; FTE HemOnc physicians, 521.7) and standard (STD) HemOnc physician (practices, 54; physicians, 551.3). 5, 5th and includes E/M services as well as infusion services. Figure 11 shows wrvu for E/M services in the office and hospital settings whereas Figure 12 includes wrvu for E/M services in the hospital setting only. Figure 18. Total practice expense less cost of goods paid for per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 49; physicians, 493.9) and standard (STD) HemOnc physician (practices, 47; physicians, 539.4). Copyright 214 by American Society of Clinical Oncology NOVEMBER 214 jop.ascopubs.org 391 Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

8 Towle, Barr, and Senese 6,, 5,, FTE physician 1% 16% 53% Expense ($) 4,, 3,, 2,, 1,, 5th 8% 1% 12.5% COGPF, infusion pharmacy COGPF, pointof-care pharmacy HemOnc physicians, pay HemOnc staff, pay IT direct expense Other expense Figure 19. Total operating expense per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 57; physicians, 52.3), standard (STD) HemOnc physician (practices, 54; physicians, 549.9), and FTE physician (practices, 59; FTE physicians, 587.7). Expense ($) 2,5, 2,, 1,5, 1,, 5, 5th Figure 2. Net operating expense per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 48; physicians, 496.2) and standard (STD) HemOnc physician (practices, 46; physicians, 498.5). Expense ($) 8, 7, 6, 5, 4, 3, 2, FTE physician Figure 22. Practice expense mix per standard hematology/oncology (HemOnc) physician. COGPF, cost of goods paid for; IT, information technology. 8,, 7,, 6,, 5,, 4,, 3,, 2,, 1,, FTE physician 5th Figure 23. Total revenue per full-time equivalent (FTE) hematology/ oncology (HemOnc) physician (practices, 52; physicians, 499.4), standard (STD) HemOnc physician (practices, 49; physicians, 484.5), and FTE physician (practices, 52; FTE physicians, 614.6). 9,, 8,, 7,, 6,, 5,, 4,, 3,, 2,, 1,, FTE physician 5th 1, 5th Figure 24. Total medical revenue per full-time equivalent (FTE) hematology/ oncology (HemOnc) physician (practices, 56; physicians, 538.6), standard (STD) HemOnc physician (practices, 53; physicians, 523.7), and FTE physician (practices, 56; FTE physicians, 653.9). Figure 21. Information technology direct expense per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 5; physicians, 481.7), standard (STD) HemOnc physician (practices, 47; physicians, 53.6), and FTE physician (practices, 5; FTE physicians, 588.9). The HemOnc capacity ratio illustrates the productivity capacity of HemOnc physicians in the practice to see more patients in addition to their current workload on the basis of the industry standard of 7, wrvu per year. Figure 13 presents 392 JOURNAL OF ONCOLOGY PRACTICE VOL. 1, ISSUE 6 Copyright 214 by American Society of Clinical Oncology Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

9 National Practice Benchmark, 214 Report on 213 Data 8,, 7,, 6,, 5,, 4,, 3,, 2,, 1,, 5th 1,, 9, 8, 7, 6, 5, 4, 3, 2, 1, 5th Figure 25. Medical revenue less radiation oncology revenue per fulltime equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 56; physicians, 538.6) and standard (STD) HemOnc physician (practices, 53; STD physicians, 568.3). Figure 28. Net drug revenue, infusion pharmacy per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 53; physicians, 529.6) and standard (STD) HemOnc physician (practices, 5; physicians, 559.3). 16 3,5, 3,, 2,5, 2,, 1,5, 1,, 5, 5th Figure 26. Net medical revenue per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 55; physicians, 538.6) and standard (STD) HemOnc physician (practices, 52; physicians, 568.3). 5,, 4,5, 4,, 3,5, 3,, 2,5, 2,, 1,5, 1,, 5, 5th Figure 27. Drug revenue in the infusion pharmacy per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 54; physicians, 529.6) and standard (STD) HemOnc physician (practices, 51; physicians, 559.3). Revenue (%) th Figure 29. Net drug revenue as a percentage of total medical revenue (practices, 53; standard hematology/oncology physicians, 565.3). Revenue (%) th Figure 3. Net drug revenue as a percentage of net medical revenue (less radiation oncology revenue; practices, 53; standard hematology/ oncology physicians, 565.3). the HemOnc capacity ratio for practices in the analytic data set. Results significantly less than 1 indicate potential capacity for the HemOnc physicians to see more patients. Near 1 means the physicians are working near or at benchmark capacity, and growth in patient volume may require the addition of more Copyright 214 by American Society of Clinical Oncology NOVEMBER 214 jop.ascopubs.org 393 Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

10 Towle, Barr, and Senese , 5, Revenue (%) , 3, 2, 5 1, 5th 5th Figure 31. Net drug revenue as a percentage of cost of goods paid for (practices, 51; standard hematology/oncology physicians, 553.8). Figure 34. Infusion service revenue per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 5; physicians, 499.4) and per standard (STD) HemOnc physician (practices, 47; physicians, 484.5). 2,5 2, Total revenue Medical revenue 1,5 1, 5 5th Figure 32. Total revenue per established patient visit (practices, 52; standard hematology/oncology physicians, 535) and medical revenue (less radiation oncology revenue) per established patient visit (practices, 55; standard hematology/oncology physicians, 548.5), for both office and hospital services. 6, 5, 14, 12, 1, 8, 6, 4, 2, 5th Figure 35. Laboratory revenue per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 43; physicians, 437.3) and per standard (STD) HemOnc physician (practices, 4; physicians, 471.4). 4, 3, 2, 1, 5th Figure 33. Evaluation and management service revenue per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 54; physicians, 59.4) and per standard (STD) HemOnc physician (practices, 51; physicians, 539). 5, 45, 4, 35, 3, 25, 2, 15, 1, 5, FTE physician 5th physicians or nonphysician practitioners (NPPs). The benchmark is not a goal but is rather a reference point that allows for normalization of practice revenue and expense to a common unit, the physician. Figure 36. Imaging revenue per full-time equivalent (FTE) hematology/ oncology (HemOnc) physician (practices, 25; FTE HemOn physicians, 353.3), per standard (STD) HemOnc physician (practices, 23; physicians, 39.4), and per FTE physician (practices, 25; FTE physicians, 454). 394 JOURNAL OF ONCOLOGY PRACTICE VOL. 1, ISSUE 6 Copyright 214 by American Society of Clinical Oncology Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

11 National Practice Benchmark, 214 Report on 213 Data 8, 7, 18% 2% 6, 5, 4, 3, 2, 1, 5th 1% 3% 1% 15% 16% 32% 3% Net drug,infusion Net drug, pointof-care pharmacy E/M Infusion Imaging Laboratory Clinical trial Other medical Nonmedical Figure 37. Clinical trial revenue per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 33; physicians, 399) and per standard (STD) HemOnc physician (practices, 31; physicians, 47). 1,2, 1,, 8, 6, 4, 2, 5th Figure 38. Total revenue point-of-care pharmacy per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 27; physicians, 334.3) and per standard (STD) HemOnc physician (practices, 25; physicians, 346.3). 9, 8, 7, 6, 5, 4, 3, 2, 1, 5th Figure 39. Net revenue point-of-care pharmacy per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 27; physicians, 334.3) and per standard (STD) HemOnc physician (practices, 25; physicians, 346.3). Figure 4. Revenue mix per standard hematology/oncology physician. E/M, evaluation and management. Inventory ($) 12, 1, 8, 6, 4, 2, 5th Figure 41. Inventory on hand at end of 12-month period per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 52; physicians, 495.9) and per standard (STD) HemOnc physician (practices, 5; physicians, 531.5). Days th Figure 42. Business days inventory on hand (practices, 5; standard hematology/oncology physicians, 522). Figures 14 and 15 show the number of established patient visits per FTE and physician for the 12-month period. Figure 14 includes visits in the office setting (Common Procedural Terminology [CPT] codes ), and Figure 15 reports on established patient visits in the hospital (CPT codes to 9922, to 99233, to 99236, to 99239). Copyright 214 by American Society of Clinical Oncology NOVEMBER 214 jop.ascopubs.org 395 Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

12 Towle, Barr, and Senese Accounts Receivable ($) 1,, 9, 8, 7, 6, 5, 4, 3, 2, 1, 5th Figure 43. Collectable accounts receivable per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 52; FTE HemOnc physicians, 52.9) and per standard (STD) HemOnc physician (practices, 49; physicians, 532.5). Days th Figure 44. Business days sales outstanding (practices, 49; standard hematology/oncology physicians, 528.2). Financial Benchmarks: Practice Expense, Revenue, Asset Management Total practice expense (Fig 16) is defined as all cash expenses for the business entity for the 12-month period. This includes cost of drugs, W-2 salaries for all staff including physicians, and all other expenses for the period. COGPF is defined as the total of all money paid for drugs in the 12-month period less any rebates or other cost reductions for drugs taken in the same period. COGPF is presented in Figure 17. As we mentioned in the Net Revenue and Net Drug Revenue section, many of the financial benchmarks are presented net of COGPF. Net practice expense, or total practice expense less COGPF, is shown in Figure 18. Total operating expense is defined as total practice expense less W-2 physician compensation (Fig 19), and net operating expense is total practice expense less W-2 physician compensation less COGPF (Fig 2). Information technology (IT) expense has become increasingly important to oncology practices. Figure 21 presents IT direct expense, which includes software, hardware, license fees, interfaces, support, maintenance, upgrades, and IT staff W-2 salary reported on a cash basis for the 12-month period. Practices were instructed to include only depreciation taken in the reporting period for hardware or software that was capitalized. A practice expense mix for the HemOnc line of business (Fig 22) is reported on the basis of the adjusted average per STD HemOnc physician. These data include all practices reporting in each category; the number of respondents varies from one category to the next. COGPF for the infusion pharmacy represents 53% of the practice expense mix for the practices included in the data. Total revenue (Fig 23) is defined as total cash collections (medical and nonmedical) for the business entity for the Table 2. Staffing Categories and Definitions Category Definition Figure All staff All staff working in all departments/specialties in the practice; includes NPPs but does 45, 47 not include physicians. HemOnc staff All staff in the HemOnc line of business in the practice; includes NPPs but does not 46, 48 include physicians. NPP Includes nurse practitioners and physician s assistants working in the HemOnc line of 49, 5, 65, 66 business. Executive staff Includes all executive and senior management staff in all departments/specialties in the practice; includes all staff who report to the physician executive or the Board; includes the physician executive; does not include department-level supervisors. 51, 52 Billing staff Includes all staff in the billing and collecting process in the practice for all 53, 54, 67, 68 departments/specialties but does not include patient financial advocates. Financial advocate Includes all staff in the patient financial advocate or financial counseling process in the 55, 56 practice for all departments/specialties. Imaging staff Includes all nonphysician imaging staff employed by the practice. 57, 58, 69 Laboratory staff Includes all laboratory staff employed by the practice. 59, 6, 7 Research staff Includes all staff performing clinical research and research clerical support for all departments/specialties in the practice but does not include physician research time. 61, 62, 7 Chemotherapy administration staff Includes all staff responsible for drug purchasing, drug mixing and preparation, delivery to patients, documentation of services provided, and management of these processes, reported on an FTE basis. Staff is included in proportion to the amount of time spent on chemotherapy management activities. 63, 64, 71 Abbreviations: FTE, full-time equivalent; HemOnc, hematology/oncology; NPP, nonphysician practitioner. 396 JOURNAL OF ONCOLOGY PRACTICE VOL. 1, ISSUE 6 Copyright 214 by American Society of Clinical Oncology Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

13 National Practice Benchmark, 214 Report on 213 Data 12-month period. Total medical revenue is all revenue attributed to medical operations and is reported several ways: all medical revenue (Fig 24); medical revenue without revenue from RadOnc operations (Fig 25); and net medical revenue, which is medical revenue without RadOnc and net of COGPF (Fig 26). Note that net medical revenue represents the revenue available for practice operations (including physician compensation) for HemOnc practices and is a key metric for practices to measure and understand. Figure 27 presents drug revenue for the infusion pharmacy, which is defined as total collected revenue for all drugs purchased and administered by the practice in the 12-month period. Net drug revenue (Fig 28) is total drug revenue less COGPF and is a much more meaningful way to look at revenue from drugs available for practice operations. Drug purchases continue to be the largest expense incurred by oncology practices, but margins on those purchases are quite slim. There is no room for error in the operations of the infusion pharmacy. Figures 29 to 31 demonstrate this margin for all drugs and all payers expressed as a percentage of total medical revenue, a percentage of net medical revenue (less RadOnc revenue), and a percentage of COGPF. Additional revenue metrics are also presented: revenue per established patient visit (Fig 32); E/M service revenue (Fig 33); infusion service revenue (Fig 34); laboratory revenue (Fig 35); imaging revenue (Fig 36); clinical trial revenue (Fig 37); total revenue for closed-door/retail pharmacy (also referred to as point-of-care dispensing; Fig 38); and net revenue for closed-door/retail pharmacy, net of COGPF (Fig 39). Revenue mix (Fig 4) is reported as the adjusted average per physician and includes all practices reporting in each category. The number of respondents varies from one category to the next. It is important to note that drug revenue is reported as net drug revenue that is, total drug revenue less COGPF because we believe this presents a much more accurate picture of revenue for the oncology practice. Drug inventory is an important asset for oncology practices. Figure 41 presents drug inventory on hand (in dollars) at the end of the 12-month period per physician and physician. Business days inventory on hand is calculated by dividing the ending inventory for the period by COGPF per business day (254 business days per year) and is presented in Figure th Figure 46. Full-time equivalent (FTE) hematology/oncology (HemOnc) staff per physician (practices, 52; physicians, 465.2) and per standard (STD) HemOnc physician (practices, 49; physicians, 494.8). 6, 5, 4, 3, 2, 1, 5th Figure 47. Annual staff compensation per full-time equivalent physician (practices, 51; full-time equivalent physicians, 579.1) , 5, 4, 3, 2, 1, 2 5th Figure 45. Full-time equivalent (FTE) staff per FTE physician (practices, 52; FTE physicians, 579.1). 5th Figure 48. Annual hematology/oncology (HemOnc) staff compensation per full-time equivalent (FTE) HemOnc physician (practices, 5; FTE HemOnc physicians, 462.4) and per standard (STD) HemOnc physician (practices, 47; physicians, 492). Copyright 214 by American Society of Clinical Oncology NOVEMBER 214 jop.ascopubs.org 397 Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

14 Towle, Barr, and Senese , 18, 16, 14, 12, 1, 8, 6, 4, 2, 5th 5th Figure 49. Full-time equivalent (FTE) hematology/oncology (HemOnc) nonphysician practitioners per physician (practices, 44; physicians, 429) and per standard (STD) HemOnc physician (practices, 43; physicians, 468.3). Figure 52. Annual compensation per full-time equivalent executive staff (practices, 49; full-time equivalent executive staff, 271.1) , 1, 8, 6, 4, 2, 5th Figure 5. Annual compensation per full-time equivalent hematology/ oncology nonphysician practitioner (practices, 42; full-time equivalent nonphysician practitioners, 279.6) th Figure 51. Full-time equivalent (FTE) executive staff per FTE physician (practices, 5; FTE physicians, 55.2). Collectable accounts receivable (also known as net accounts receivable) is presented in Figure 43. This is defined as gross accounts receivable less contractual allowances less allowance for bad debt less allowance for charity care. Figure 44 presents business days sales outstanding, which is calculated by dividing th Figure 53. Full-time equivalent (FTE) billing staff per FTE physician (practices, 52; FTE physicians, 589.9). 5, 45, 4, 35, 3, 25, 2, 15, 1, 5, 5th Figure 54. Annual compensation per full-time equivalent billing staff (practices, 5; full-time equivalent billing staff, 62.5). net accounts receivable by average collections per business day (254 business days per year). Staffing and Productivity Staffing information was collected and reported for the categories presented and defined in Table 2. RadOnc-specific staffing information is also presented in the RadOnc section of this 398 JOURNAL OF ONCOLOGY PRACTICE VOL. 1, ISSUE 6 Copyright 214 by American Society of Clinical Oncology Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

15 National Practice Benchmark, 214 Report on 213 Data.4 7, , 5, 4, 3, 2, 1, 5th 5th Figure 55. Full-time equivalent (FTE) patient financial advocate per FTE physician (practices, 5; FTE physicians, 581.4). Figure 58. Annual compensation per full-time equivalent imaging staff (practices, 21; full-time equivalent imaging staff, 27.8). 5, 45, 4, 35, 3, 25, 2, 15, 1, 5, 5th th Figure 56. Annual compensation per full-time equivalent patient financial advocate (practices, 48; full-time equivalent financial advocates, 291.9). Figure 59. Full-time equivalent (FTE) laboratory staff per FTE physician (practices, 41; FTE physicians, 451.4). 6, th Figure 57. Full-time equivalent (FTE) imaging staff per FTE physician (practices, 21; FTE physicians, 377.6). article. All staff positions are reported as FTEs. One FTE staff is a person working 4 hours per week or 2,8 hours per year. Respondents were instructed that staff may be counted in more than one category as appropriate, but no individual staff person should be counted as more than one FTE. The denominator for the staffing benchmarks varies. Information is reported per FTE physician for staff categories that support all specialties in 5, 4, 3, 2, 1, 5th Figure 6. Annual compensation per full-time equivalent laboratory staff (practices, 41; full-time equivalent laboratory staff, 326.2). a multispecialty practice such as executive staff, imaging staff, and billing staff. Other staff categories such as chemotherapy administration staff are reported per FTE and physician. Number of FTE staff and annual compensation are reported in Figures 45 through 64. Productivity measures are reported for several staff categories. Figure 65 presents NPP wrvu per physician and STD Copyright 214 by American Society of Clinical Oncology NOVEMBER 214 jop.ascopubs.org 399 Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.

16 Towle, Barr, and Senese , 7, 6, 5, 4, 3, 2, 1, 5th 5th Figure 61. Full-time equivalent (FTE) clinical research staff per FTE physician (practices, 31; FTE physicians, 428). Figure 64. Annual compensation per full-time equivalent chemotherapy administration staff (practices, 5; full-time equivalent chemotherapy administration staff, 789.7). 7, 6, 5, 4, 3, 2, 1, 5th Figure 62. Annual compensation per full-time equivalent clinical research staff (practices, 3; full-time equivalent research staff, 256.6) th Figure 63. Full-time equivalent (FTE) chemotherapy administration staff per FTE hematology/oncology (HemOnc) physician (practices, 52; physicians, 48.2) and per standard (STD) HemOnc physician (practices, 49; physicians, 495.3). HemOnc physician. NPP wrvu includes both wrvu billed incident to a physician service as well as wrvu billed directly by the NPP. Figure 66 presents NPP wrvu per FTE NPP. This is specific to NPPs working in HemOnc and does not include NPPs working in any other specialties in the reporting practices. wrvu 1,6 1,4 1,2 1, th Figure 65. Nonphysician practitioner work relative value units (wrvu) per full-time equivalent (FTE) hematology/oncology (HemOnc) physician (practices, 4; physicians, 45.2) and per standard (STD) HemOnc physician (practices, 4; physicians, 491). wrvu 3,5 3, 2,5 2, 1,5 1, 5 5th Figure 66. Nonphysician practitioner work relative value unit (wrvu) per full-time equivalent hematology/oncology nonphysician practitioner (practices, 35; full-time equivalent nonphysician practitioners, 231.1). Total medical revenue (collections) per FTE billing staff is presented as a productivity measure for the billing department. Note that we report revenue two ways, both including RadOnc revenue (Fig 67) and excluding RadOnc revenue (Fig 68). Fig- 4 JOURNAL OF ONCOLOGY PRACTICE VOL. 1, ISSUE 6 Copyright 214 by American Society of Clinical Oncology Downloaded from ascopubs.org by on July 1, 218 from Copyright 218 American Society of Clinical Oncology. All rights reserved.