Johns Hopkins deal could intensify W.Pa. cancer care competition with UPMC

Feb. 09--Allegheny Health Network insists it didn't draw up its high-profile cancer partnership with Johns Hopkins Medicine as an attack on crosstown rival UPMC, which attracts seven times as many cancer patients.

Just as adamantly, UPMC executives say the alliance is not a serious threat to their clinical cancer services, a profit hub for the Downtown-based health giant.

Yet industry observers expect the Hopkins arrangement, announced last month, to intensify competition and strengthen care as the rivals draw from a growing pool of cancer cases in Western Pennsylvania. The collaboration echoes academic-clinical agreements nationwide that lure referrals, research dollars and a shrinking percentage of inpatients who deliver robust revenue, scholars say.

"If I were UPMC, I probably would be somewhat concerned about this. How much it's going to drive business is hard to say," said William Aaronson, a health care management professor and associate dean at Temple University in Philadelphia. "The real drivers of business are the physicians. When you go to your physician and you're diagnosed with cancer, where's your physician going to refer you? If this influences their thinking, then it's been successful."

North Shore-based doctors at Allegheny Health say their cancer program follows treatment standards as good as -- or better than -- any competitor in Pittsburgh. The tentative five-year deal with Johns Hopkins' Sidney Kimmel Cancer Center in Baltimore will enable 150 oncologists from Allegheny Health to exchange expertise with one of the nation's top-ranked cancer programs, said Dr. David Parda, chairman of the Allegheny Health Network Cancer Institute.

He said the approach should accelerate progress in cancer research, treatments and prevention. Hopkins clinical trials of treatments would expand to Allegheny Health Network hospitals, and Pittsburgh cancer doctors could consult with Hopkins experts on cases.

Allegheny Health's corporate parent, Downtown-based insurer Highmark Inc., will establish a fund to support cancer research projects. The company would not disclose a dollar figure.

"We certainly have opportunities to improve in Western Pennsylvania," said Dr. Tony Farah, Allegheny Health Network's chief medical officer.

He said the cancer program will focus on patient satisfaction and ways to avoid excessive treatment.

Tougher competition

Cancer experts say there's plenty of business to go around. The state Department of Health estimated there were 77,450 new cases of invasive cancer in 2013, up from 75,808 in 2010. Many are clustered in Western Pennsylvania.

Allegheny Health Network executives anticipate their 20 percent market share among Pittsburgh-area cancer cases will climb significantly over five years. Doctors in the network treated 10,000 cancer patients in 2013, up from 8,000 in 2012. UPMC reported its tally grew from about 40,000 in 2004 to about 74,000 last year. UPMC says that could reach 150,000 patients within 10 years.

Better treatment allows many survivors to avoid hospitalization. Dr. Stanley Marks, chairman at the Shadyside-based UPMC CancerCenter, said at least 90 percent of UPMC cancer patients receive outpatient care, up from 75 to 80 percent a decade ago.

That shift puts hospitals in tougher competition for inpatients, whose care can yield bigger returns and improve a hospital system's viability, Temple University's Aaronson said.

Health care reform measures that encourage efficiency can inspire partnerships between academic and clinical groups, said Victor Ribaudo, vice president of affiliations at Memorial Sloan Kettering in New York.

"Cancer is so ubiquitous that virtually every hospital will provide some form of cancer service. The better their job, the more successful they're likely to be in a competitive market, particularly if they can demonstrate superior outcomes and do it at a lower cost," Ribaudo said.

He said partnerships picked up speed in the past couple of years. Sloan Kettering announced one in September with Hartford HealthCare in Connecticut.

Though Allegheny Health might snag patients from UPMC under its Hopkins agreement, a bigger impact could be in research, said Joseph Dionisio, a health policy professor at Penn State University. Still, he doubts any significant impact on UPMC.

"I wish this was a shot across the bow of UPMC, but I don't think it is," said Dionisio, a former administrator for one of Allegheny Health's predecessor organizations. "If they get a few less patients a year, I don't know that it would show up on their radar screens."

'A unique model'

UPMC spokesman Paul Wood said the Hopkins deal shows that Allegheny Health is trying to challenge the dominant provider. UPMC holds an estimated 70 to 80 percent market share among cancer outpatients in the region.

Its provider agreement with Highmark ends on Dec. 31, a shift that will force some Highmark customers to pay higher out-of-pocket expenses at UPMC hospitals.

UPMC does not view the Hopkins agreement as competition but welcomes "anything that improves cancer care for our community," Marks said.

"We have truly integrated with the academic faculty at UPMC, which is sort of a unique model," said Marks, who joined UPMC in 2000 from Allegheny General Hospital, an Allegheny Health property.

Designated by the National Cancer Institute as a comprehensive care center, UPMC CancerCenter has an academic and research partner in the University of Pittsburgh Cancer Institute, which reported more than $146 million in research grants and funding for 2013.

"In theory, we've been competing with (Johns Hopkins) forever," said UPMC Executive Vice President Chuck Bogosta, who noted that Hopkins hosts an NCI-designated care center. "It's not like this is something that's bringing something new to Pittsburgh."

Adam Smeltz is a Trib Total Media staff writer. Reach him at 412-380-5676 or asmeltz@tribweb.com.

___

(c)2014 The Pittsburgh Tribune-Review (Greensburg, Pa.)

Visit The Pittsburgh Tribune-Review (Greensburg, Pa.) at www.pittsburghlive.com/x/pittsburghtrib

Distributed by MCT Information Services