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What Would Super Committee Say About $430M Proton Beam Center War?

 |  By cclark@healthleadersmedia.com  
   November 03, 2011

As members of the debt reduction "super committee" wrestle to slice $400 billion from Medicare over 10 years, I wonder what they might say about the $430 million proton beam center war now being waged a few miles from my home in San Diego.

This nearly a half billion dollar investment in proton therapy is a big part of what's wrong—in a microcosm—with the healthcare system.

Leaders of two healthcare powerhouses here—Scripps Health and UC San Diego Medical Center—each want their system's name on their own cyclotron building. So each hospital is proceeding with massive construction projects five miles apart.

Scripps, which broke ground on its $225 million Scripps Proton Therapy Center in October of 2010, has the lead and will start treating 2,500 patients a year in 2013. UCSD, announced the same month that it will build its own $205 million UC San Diego Proton Therapy and Research Center in La Jolla, to treat 1,500 patients a year. 

Both organizations intend to conduct research on the effectiveness of proton beam therapy treatments, which arguably has not yet been decisively shown.  There are only nine cancer proton centers in the nation, and four were built only in the last few years.

As one might imagine, Chris Van Gorder, president and CEO of Scripps Health, is furious, saying he "can't believe" the state-funded hospital now plans a project of this magnitude right next to his. 

"The story here is a government (UCSD) using community and taxpayer resources to build unnecessary facilities and capacity," Van Gorder says. "They are using the advantages of being a government to compete – arguably unfairly – against private facilities (and their) Proton (center) is a perfect example. There is absolutely no justification to build two in the same community when there are only (nine) in the entire United States."

Proton therapy, he explains, has high fixed costs and needs enough volume just to cover that and generate enough margin. "If a community has too many beds or therapy centers, it becomes difficult, if not impossible to cover fixed costs, much less variable ones. And then all fail."

Medicare is expected to pay most of the cost, about $55,000 for one patient's course of treatment, plus $15,000 in physician fees.

The Scripps leadership team was so concerned about the financial risks, Van Gorder says, that Scripps refused to finance the project itself. So it is partnering with Advanced Particle Therapy, (APT) LLC of Minden, NV, which bought the seven-acre site and financed the 102,000-square foot, three-story construction, backed by venture capital investors.

Scripps Clinic Physicians Group and Scripps Health will oversee the medical operation under a management contract, will allow the use of its name, and supply the operations team of 135 people. Scripps does not expect to share in any profit, if there is any to be had.

This leads to the bottom line issue: reimbursement. There are questions about whether major payers will cover it and to what extent. After several days of meetings last year, the Centers for Medicare & Medicaid Services' MEDCAC (Medicare Evidence Development & Coverage Advisory Committee) opted against adopting a national coverage decision to reimburse for proton or any other treatments for prostate cancer because experts vehemently disagree which works best.

In effect, that means whether you get proton beam therapy depends on regional Medicare contractors in whatever part of the country you live in and/or whether you have an accepting supplemental insurance carrier. Blue Cross Blue Shield of Wisconsin, for example, is one that is considering not covering proton therapy for prostate cancer, according to Leonard Arzt, executive director of the National Association for Proton Therapy.

And, Medicare regional contractors could become even stingier down the line, declining coverage for other cancer sites if a few years hence, they determine proton therapy isn't as good as the next new thing.

There's always something to worry about with coverage," says Arzt. "CMS is a roller coaster; from year to year one does not know how it's going to turn out."

UCSD's Department of Radiation Oncology chair Arno J. Mundt, MD, did not respond to a request for comment. But a UCSD spokeswoman released a brief statement saying the university "remains dedicated to providing proton therapy as one of the necessary tools a comprehensive cancer center should have in its arsenal." She referred to last year's press release, which explains UCSD is partnering with Proton Health Partners of San Diego to build "one of the strongest proton center treatment teams in the nation."

Proton beam therapy aims radiation beams from a 6 by 9 foot cyclotron to accelerate protons that zap certain tumors. This nuclear-reactor look-alike, with the weight of a loaded 737 jet, has an aggressive precision that some experts say is far more effective than other cancer treatments.

It is said to result in fewer side effects and cause less damage to healthy tissue than other radiation techniques, as well as non-radiation treatment options like surgery in certain patients. And treatment is an outpatient procedure, taking no more than about 20 minutes.

While the technology is not new, experience is limited but three more proton beam centers are under development in Somerset, NJ, Seattle, and Flint, MI. The oldest, which began in 1990 and is the only facility west of Oklahoma City, is just 95 miles north of San Diego at Loma Linda University.

Van Gorder acknowledges that proton beam is a somewhat risky venture. Candidly, he says, there's probably not enough demand for 3,500 patients in a county of only 3.5 million.

Patients may have to be brought in from across the country.

"Are there enough patients in San Diego for two proton beam therapy center sites? No," Van Gorder says. "Are there enough patients for one site? Maybe. It's all about whether or not the patients can come, and from how far." The closest facilities beyond Loma Linda are in Houston at M.D. Anderson, in Oklahoma City at the ProCure Proton Therapy Center and in Chicago at the CDH Proton Center.

A. Brent Eastman, MD, Scripps Chief Medical Officer and president-elect of the American College of Surgeons, acknowledges that comparative effectiveness of proton beam therapy is largely uncharted territory. That's why Scripps, which treats the bulk of the region's cancer patients, wants to use proton beam as a research tool, "one arrow in our quiver," to look at longer term outcomes compared with other cancer treatments.

"If proton beam today is not the right way to treat carcinoma of the pancreas, for example, which is an area that is being looked into, then what is?" Eastman says. "We want to be part of the evolution of this technology."

Eastman says research in proton beam also is important to prevent unintended consequences like readmissions. "Whatever Medicare pays for this, they're not going to pay for (excess) readmissions," he says. "So if treatment with proton beam has a lower fistula rate with pancreatic tumors or a lower infection rate or lower chronic radiation fibrosis down the line...we will have a great system to see that."

All good points. So why can't everybody just cooperate? Van Gorder says they've tried to go that route, meeting with every healthcare system in the region and offering to make the proton center "inclusive." In particular, Scripps has offered to collaborate with UCSD.

There have been discussions, Van Gorder says, but UCSD's recent statements indicate, "they're not interested."

I asked members of Scripps' proton beam team whether the situation suggests the need for another certificate of need system, in which a hospital's plans to acquire expensive, redundant technologies would be subject to agency approval.

Of course that won't happen, they say.

It leaves one to wonder how this looks as the nation struggles to cut waste anywhere it can. And again, I wonder what that supercommittee might say about all of this.

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