As mounting evidence illustrates proton therapy’s value for cancer patients, the number of facilities offering the treatment continues to rise, but that doesn’t mean every proton therapy center is a success. Over the years, a few of these facilities – which can cost hundreds of millions of dollars to open – have been hit with financial hardships.

What distinguishes a thriving proton therapy facility from one that struggles to stay afloat? What kind of questions do providers need to ask before investing in this cutting-edge treatment?

Earlier this year, the California Proton Treatment Center in San Diego filed for Chapter 11 bankruptcy. While the center has treated 1,400 patients since it opened a little more than three years ago, volumes have been less than expected. It seems fewer men with prostate cancer had been referred for treatment, according to a Scripps source who asked not to be identified.


"The treatment protocols for proton therapy for certain types of cancer, most notably prostate cancer, have become more conservative, making proton therapy more difficult to access for many patients," the source told HealthCare Business News via email. "Just a few months before Scripps Proton Therapy Center opened in February 2014, Blue Shield of California announced its plans to drop coverage for proton to treat early-stage prostate cancer."

The facility was built by an investment group and then leased to Scripps Health, which is not an investor or at financial risk in the arrangement.

This type of financial duress seems to be the exception to the norm, as new facilities continue to ramp up their own proton therapy centers. According to the National Association for Proton Therapy (NAPT), there are 25 proton centers operating in the U.S. (including two less than 20 miles apart in Oklahoma City) with another 11 centers in development. A recent analysis from Grand View Research projects the global proton therapy market will exceed $2.8 billion by 2025.

A regional resource
"What struck me at the time we had the vision for our center was that this would be a $200 million investment and that the literature suggested that 20 to 30 percent of the 60 percent of all cancer patients who get radiation treatment could benefit from proton therapy," William F. Regine, FACRO, FACR, Isadore & Fannie Schneider Foxman Chair in the Department of Radiation Oncology at the University of Maryland, told HCB News.

Dr. Regine is also executive director of the Maryland Proton Treatment Center (MPTC).

"So we thought, why not consider this a regional resource?" he said.



This decision to engage other, competing health systems in the business model, the antithesis of a medical arms race, has made the Maryland Proton Treatment Center a success, according to Regine. They took several, unprecedented steps in organizing their referral and treatment network, as well as relationships with insurance companies that pay the bills.

They began cultivating a referral network well before they opened. Regine explained that MPTC focused on radiation oncologists and invited them to work side by side with their proton medical staff. The Maryland center offered medical staff privileges with accreditation (and provides the training) so doctors from other hospitals could treat their patients and receive the physician payment component from insurance companies.

The visiting physicians get access to Maryland's secure treatment planning system and patient electronic medical record, as well. This effort has resulted in three large health systems referring patients to the center, and an agreement with a fourth large community-based group, as well as ongoing discussions with additional groups expected to also partner with MPTC in the next year.

"The model works," said Dr. Regine. "The visiting physicians who have privileges to treat with proton therapy get paid the same rate as the doctors on my staff."

He said it's also a comfort to patients who don't have to switch doctors to receive proton therapy. Patients, he noted, are much more educated about their options and will sometimes self-refer to MPTC. With the visiting physicians' program, they can often reassure that a radiation oncologist has privileges to administer proton therapy and refer the patient back to their community-based doctor.


"This reassures the patient that they have access to all the tools in the cancer treatment toolbox by doctors in their community," Dr. Regine said.

This level of collaboration is highly unprecedented. But it secures the volumes needed to pay for the technology. While Medicare pays for proton treatments, private insurers have taken a harder line, requiring that physicians use what they believe is less costly and equally effective conventional radiation treatments.

On this front, Regine and his staff achieved another unprecedented accomplishment. They have found a way to make proton treatment cost-neutral.

"To the best of our knowledge, we're only one of two proton centers in the country where the cost of proton therapy is neutral with other cancer radiation treatment options, instead of being up to two and a half times more expensive," he said. "Imagine how well that conversation goes with the payers."

The result, according to Dr. Regine, is that on the first evaluation 70 to 80 percent of their patients are approved by insurance companies, as opposed to 30 to 50 percent across the proton treatment community. This solves a major problem in the sector as patients often feel caught in the middle between their doctors who want to use proton therapy and insurance companies that must control costs.

Articulating value to insurers
In April, a brain cancer patient in Florida filed suit against his employer and Florida Blue for their denial of proton therapy at the Mayo Clinic after the patient had gone through four months of chemotherapy with no success. He, his family and friends came up with $200,000 in four days for the proton treatment, which the patient reports has put his cancer in remission.

This issue of patient rights is a focus for the Alliance for Proton Therapy Access (The Alliance), a nonprofit in Washington, D.C. The Alliance believes cancer patients deserve better, Executive Director Daniel E. Smith told HCB News.


"When cancer patients are prescribed proton therapy by their doctors, too many patients are forced to battle restrictive, complex and seemingly arbitrary insurance policies and practices that make if difficult or impossible to receive timely access to treatment," he said.

In July, The Alliance launched its "Tell Insurers: Fight Cancer, Not Me" campaign. The intent of the campaign is to advocate for more transparent policies to ensure approvals, without delay, by all insurers when physician-prescribed proton therapy offers a patient the best hope for survival.
Stuart Klein, executive director of the University of Florida Health Proton Therapy Institute (UFHPTI) in Jacksonville, has been in the proton therapy industry since 2006. He said that the market has changed in the past three years, shifting from primarily prostate cancer treatments to treating patients with a wider range of cancers. According to Klein, UFHPTI currently treats more patients, including children, than any other center in the world.

"These facilities should really be regional resources," said Klein. "Some of the independent centers are trying to get in without committed clinical partners. This makes it much more difficult to secure patients and insurance contracts."

He likened it to hospitals that in the past have decided to move to Level 1 Trauma emergency departments as a competitive move, only to discover such services are resource rich and expensive to operate and often lose money. Klein also cautioned that it could be difficult to find qualified staff, from engineers to physicians, to staff proton therapy centers. In their center, for example, he said they staff with 12 to 15 certified engineers.

The manufacturer perspective
The three leading proton therapy manufacturers echo many of the sentiments of the clinicians and the health systems they serve when it comes to best practices for launching a successful proton therapy facility.

"When we see PT sites that are struggling, there are usually three common reasons," Beth Klein, president of IBA Therapy, told HCB News.

She said these causes, which can stand alone or be combined, are: unrealistic projected patient volumes (including ramp-up rate); underestimated infrastructure costs; and the lack of a true clinical partner.



Building a single-gantry or multiple-gantry treatment facility is also a key decision associated with meeting financial projections.

"Single rooms lower costs up-front," Bill Hansen, director of marketing for the Varian Particle Therapy Division, told HCB News. "But building multi-rooms [has] clear advantages as the cost per room goes down."



He said Varian looks at the cost per room per patient, especially in a situation where patient volume makes it viable to run two shifts. In general, he said that the trend appears to be a single room in small markets and multi-rooms in larger markets. And, he noted, the overseas market is different than the U.S. In China, for example, cancer rates are increasing, and multi-room proton facilities are more in demand.

Joseph Jachinowski, president, CEO and director at Mevion, told HCB News that he thinks the single room is more the way to go in a U.S market that is maturing.

"Multi-room economics are far too risky now," he said. "You give up nothing clinically by building a single room, and you don’t want to bet the house on a $200 million multi-room project. The ramp-up to pay for three rooms can be a pitfall compared to a single room. You can always add a second room later, if needed."

An important factor in determining the right size for a facility, according to Jachinowski, is making sure you have a thorough understanding of your anticipated patient population and account for potential variables.

This includes running scenarios, for example, where the volume is not as projected, or there are cuts in reimbursements.

All three manufacturer sources agreed that as proton therapy is proven through ongoing and additional clinical trials to offer better outcomes for patients, the stress around insurance coverage will dissipate and the pathway to access will become clearer.

"This is a powerful technology that should be available to patients who need it," said Beth Klein. "It's not going to replace radiation therapy, but there is clear evidence that conservatively 20 percent of cancer patients can benefit from it."