Interview with Joseph R. Berger, MD, on the Financial Contribution of the MS Specialist

Dr. Joseph Berger’s article The Financial Contribution of the Multiple Sclerosis Specialist
(Neurol Clin Pract. 2017;7:246-255) is an eye-opening examination of how multiple sclerosis (MS) specialists fit into the economic framework of large academic institutions. We sat down with Dr. Berger to discuss his findings.

How would you describe the downstream revenue generated from MS specialists at large academic institutions?

The downstream revenue generated from MS is highly dependent on whether the drugs prescribed to patients are provided by the academic institution, and whether the infusions and imaging studies are done at the academic institution.

Another component is whether that institution operates under a Medicare 340B, a law that enables the institutions that are providing care to the underserved to acquire drugs at a steeply discounted price. And, as cited in the paper, the Office of the Inspector General of the Department of Health and Human Services estimated that the profit margin is 58% for all the drugs being provided under 340B. It’s important to note that that statistic accounts for all drugs, not a specific drug or a specific class of drugs. But, for the sake of argument let’s assume that it’s 50% for MS drugs.

The typical MS drug costs $60,000 a year if not more, and that means that 50% of that total goes to the contribution margin of the MS provider or the MS clinic. If there are 1000 patients for whom the specialty pharmacy within the institution is providing drugs, that means an enormous amount of money is returning to the institution as a result of the contribution by the MS practitioners.

In addition to the cost of the drugs, there’s also the cost of infusions associated with the drug that contributes substantially to the bottom line of the institution.

MS specialists tend to do more imaging studies than any other discipline. At the time of diagnosis, individuals with MS get MRIs of brain, cervical and thoracic spine, and frequently the orbits. The frequency with which these images are repeated depends on the nature of the patient’s illness, the activity of their disease, etc.

How do you make a case to administrators for more funding in MS centers?

Unfortunately, the downstream revenue does not always find its way back to the MS centers. Moreover, MS practitioners are forced to prove their value to the institution before they can receive the resources that they need.

There are only two things that administrators in medical institutions respond to. The first is need. The second is the financial impact of the activity.

Here is an example from my own personal experience. I prescribed a specific drug for a patient who did not live close to the institution. It took three months for the patient to receive the drug. This was due, in large measure, to problems with the insurance company and the outside specialty pharmacies that we were dealing with. In that course of time the patient suffered two relapses from which she never fully recovered.

I thought we could do a much better job treating our patients if our own specialty pharmacy was providing the drug. Eventually, after some negotiating with the administration, we were able to provide all those drugs through our specialty pharmacy. That change resulted in a significant increase in terms of contribution margin for the MS team, and it was a great benefit for our patients.

How does MS compare with other neurology disciplines?

If you look at the contribution margin from MS and compare it to in any other division in neurology, it exceeds all of them combined by a significant percentage.

For example, the current contribution margin in the MS division at the University of Pennsylvania exceeds that of virtually any other line within the Neuroscience Center Service, which includes neurosurgery. It is on par with, and may exceed, that of spine surgery, which in the past had always been the biggest driver of the contribution margin from the Neuroscience service line.

Often, MS specialists aren’t getting the resources needed despite the fact that their growing practice would enhance the contribution margin.

Since this has been brought to the attention of the administration at the University of Pennsylvania, there have been increased resources available for the division; we now have more nurses and nurse practitioners, and we have pharmacists within the division. All of this has made a big difference in helping to provide the best care for our patients.

How would you characterize the compensation of the MS specialist?

One of the things that I did address in the article, but only obliquely, is the compensation of the MS neurologist.

Historically, the MS neurologist was among the least compensated of all the neurology disciplines, in academics as well as in private practice. The reason for this was simple. Until the early 1990s, there were very few drugs to treat MS. It was more a matter of diagnosing people and treating the symptoms as they arose. When drugs for MS emerged, they were not particularly complex to manage.

However, as new drugs have become available, and the efficacy of these drugs increased, so did their side effect profiles. A need arose for specialists to manage the treatment of patients with MS.

I hope to address this further in a future publication, but the underlying assertion is that the compensation of the MS neurologist needs to be revisited at both academic institutions and in the community.

Final thoughts?

The article was an attempt to educate not just the MS community, but the broader neurologic community as to the value of an MS specialist to an institution.

The purpose of this article was to encourage people to think about their worth and the worth of what they do as it applies to the financial well-being of the institution with which they’re associated.

Dr. Joseph Berger’s article The Financial Contribution of the Multiple Sclerosis Specialist
(Neurol Clin Pract. 2017;7:246-255) is an eye-opening examination of how multiple sclerosis (MS) specialists fit into the economic framework of large academic institutions. We sat down with Dr. Berger to discuss his findings.

How would you describe the downstream revenue generated from MS specialists at large academic institutions?

The downstream revenue generated from MS is highly dependent on whether the drugs prescribed to patients are provided by the academic institution, and whether the infusions and imaging studies are done at the academic institution.

Another component is whether that institution operates under a Medicare 340B, a law that enables the institutions that are providing care to the underserved to acquire drugs at a steeply discounted price. And, as cited in the paper, the Office of the Inspector General of the Department of Health and Human Services estimated that the profit margin is 58% for all the drugs being provided under 340B. It’s important to note that that statistic accounts for all drugs, not a specific drug or a specific class of drugs. But, for the sake of argument let’s assume that it’s 50% for MS drugs.

The typical MS drug costs $60,000 a year if not more, and that means that 50% of that total goes to the contribution margin of the MS provider or the MS clinic. If there are 1000 patients for whom the specialty pharmacy within the institution is providing drugs, that means an enormous amount of money is returning to the institution as a result of the contribution by the MS practitioners.

In addition to the cost of the drugs, there’s also the cost of infusions associated with the drug that contributes substantially to the bottom line of the institution.

MS specialists tend to do more imaging studies than any other discipline. At the time of diagnosis, individuals with MS get MRIs of brain, cervical and thoracic spine, and frequently the orbits. The frequency with which these images are repeated depends on the nature of the patient’s illness, the activity of their disease, etc.

How do you make a case to administrators for more funding in MS centers?

Unfortunately, the downstream revenue does not always find its way back to the MS centers. Moreover, MS practitioners are forced to prove their value to the institution before they can receive the resources that they need.

There are only two things that administrators in medical institutions respond to. The first is need. The second is the financial impact of the activity.

Here is an example from my own personal experience. I prescribed a specific drug for a patient who did not live close to the institution. It took three months for the patient to receive the drug. This was due, in large measure, to problems with the insurance company and the outside specialty pharmacies that we were dealing with. In that course of time the patient suffered two relapses from which she never fully recovered.

I thought we could do a much better job treating our patients if our own specialty pharmacy was providing the drug. Eventually, after some negotiating with the administration, we were able to provide all those drugs through our specialty pharmacy. That change resulted in a significant increase in terms of contribution margin for the MS team, and it was a great benefit for our patients.

How does MS compare with other neurology disciplines?

If you look at the contribution margin from MS and compare it to in any other division in neurology, it exceeds all of them combined by a significant percentage.

For example, the current contribution margin in the MS division at the University of Pennsylvania exceeds that of virtually any other line within the Neuroscience Center Service, which includes neurosurgery. It is on par with, and may exceed, that of spine surgery, which in the past had always been the biggest driver of the contribution margin from the Neuroscience service line.

Often, MS specialists aren’t getting the resources needed despite the fact that their growing practice would enhance the contribution margin.

Since this has been brought to the attention of the administration at the University of Pennsylvania, there have been increased resources available for the division; we now have more nurses and nurse practitioners, and we have pharmacists within the division. All of this has made a big difference in helping to provide the best care for our patients.

How would you characterize the compensation of the MS specialist?

One of the things that I did address in the article, but only obliquely, is the compensation of the MS neurologist.

Historically, the MS neurologist was among the least compensated of all the neurology disciplines, in academics as well as in private practice. The reason for this was simple. Until the early 1990s, there were very few drugs to treat MS. It was more a matter of diagnosing people and treating the symptoms as they arose. When drugs for MS emerged, they were not particularly complex to manage.

However, as new drugs have become available, and the efficacy of these drugs increased, so did their side effect profiles. A need arose for specialists to manage the treatment of patients with MS.

I hope to address this further in a future publication, but the underlying assertion is that the compensation of the MS neurologist needs to be revisited at both academic institutions and in the community.

Final thoughts?

The article was an attempt to educate not just the MS community, but the broader neurologic community as to the value of an MS specialist to an institution.

The purpose of this article was to encourage people to think about their worth and the worth of what they do as it applies to the financial well-being of the institution with which they’re associated.

Dr. Joseph Berger’s article The Financial Contribution of the Multiple Sclerosis Specialist
(Neurol Clin Pract. 2017;7:246-255) is an eye-opening examination of how multiple sclerosis (MS) specialists fit into the economic framework of large academic institutions. We sat down with Dr. Berger to discuss his findings.

How would you describe the downstream revenue generated from MS specialists at large academic institutions?

The downstream revenue generated from MS is highly dependent on whether the drugs prescribed to patients are provided by the academic institution, and whether the infusions and imaging studies are done at the academic institution.

Another component is whether that institution operates under a Medicare 340B, a law that enables the institutions that are providing care to the underserved to acquire drugs at a steeply discounted price. And, as cited in the paper, the Office of the Inspector General of the Department of Health and Human Services estimated that the profit margin is 58% for all the drugs being provided under 340B. It’s important to note that that statistic accounts for all drugs, not a specific drug or a specific class of drugs. But, for the sake of argument let’s assume that it’s 50% for MS drugs.

The typical MS drug costs $60,000 a year if not more, and that means that 50% of that total goes to the contribution margin of the MS provider or the MS clinic. If there are 1000 patients for whom the specialty pharmacy within the institution is providing drugs, that means an enormous amount of money is returning to the institution as a result of the contribution by the MS practitioners.

In addition to the cost of the drugs, there’s also the cost of infusions associated with the drug that contributes substantially to the bottom line of the institution.

MS specialists tend to do more imaging studies than any other discipline. At the time of diagnosis, individuals with MS get MRIs of brain, cervical and thoracic spine, and frequently the orbits. The frequency with which these images are repeated depends on the nature of the patient’s illness, the activity of their disease, etc.

How do you make a case to administrators for more funding in MS centers?

Unfortunately, the downstream revenue does not always find its way back to the MS centers. Moreover, MS practitioners are forced to prove their value to the institution before they can receive the resources that they need.

There are only two things that administrators in medical institutions respond to. The first is need. The second is the financial impact of the activity.

Here is an example from my own personal experience. I prescribed a specific drug for a patient who did not live close to the institution. It took three months for the patient to receive the drug. This was due, in large measure, to problems with the insurance company and the outside specialty pharmacies that we were dealing with. In that course of time the patient suffered two relapses from which she never fully recovered.

I thought we could do a much better job treating our patients if our own specialty pharmacy was providing the drug. Eventually, after some negotiating with the administration, we were able to provide all those drugs through our specialty pharmacy. That change resulted in a significant increase in terms of contribution margin for the MS team, and it was a great benefit for our patients.

How does MS compare with other neurology disciplines?

If you look at the contribution margin from MS and compare it to in any other division in neurology, it exceeds all of them combined by a significant percentage.

For example, the current contribution margin in the MS division at the University of Pennsylvania exceeds that of virtually any other line within the Neuroscience Center Service, which includes neurosurgery. It is on par with, and may exceed, that of spine surgery, which in the past had always been the biggest driver of the contribution margin from the Neuroscience service line.

Often, MS specialists aren’t getting the resources needed despite the fact that their growing practice would enhance the contribution margin.

Since this has been brought to the attention of the administration at the University of Pennsylvania, there have been increased resources available for the division; we now have more nurses and nurse practitioners, and we have pharmacists within the division. All of this has made a big difference in helping to provide the best care for our patients.

How would you characterize the compensation of the MS specialist?

One of the things that I did address in the article, but only obliquely, is the compensation of the MS neurologist.

Historically, the MS neurologist was among the least compensated of all the neurology disciplines, in academics as well as in private practice. The reason for this was simple. Until the early 1990s, there were very few drugs to treat MS. It was more a matter of diagnosing people and treating the symptoms as they arose. When drugs for MS emerged, they were not particularly complex to manage.

However, as new drugs have become available, and the efficacy of these drugs increased, so did their side effect profiles. A need arose for specialists to manage the treatment of patients with MS.

I hope to address this further in a future publication, but the underlying assertion is that the compensation of the MS neurologist needs to be revisited at both academic institutions and in the community.

Final thoughts?

The article was an attempt to educate not just the MS community, but the broader neurologic community as to the value of an MS specialist to an institution.

The purpose of this article was to encourage people to think about their worth and the worth of what they do as it applies to the financial well-being of the institution with which they’re associated.