- Progress in the fight against pancreatic cancer?
- Pouring billions down the drain?
- Does calorie labeling work?
- When life gives you MACRA.
- A one size fits all formulary policy?
According to a recent study by Koulayev, Simeonova, and Skipper (2016) using data from Denmark, the answer is ‘yes’.
Non-compliance with medication therapy remains an unsolved and expensive problem for healthcare systems around the world, yet we know little about the factors that affect a patient’s decision to follow treatment recommendations. In particular, there is little evidence on the extent to which doctors can influence patient adherence behavior. This study uses a unique panel dataset comprising all prescription drug users, physicians, and all prescription drug sales in Denmark over 7 years to analyze the contributions of doctor-specific, patient-specific, and drug-specific factors to the adherence decision. We find that physicians exert substantial influence on patient compliance. Further, the quality of the match between a doctor and a patient accounts for a substantial portion of the variation in adherence outcomes. This suggests that the sorting of patients across doctors is an important mechanism that affects patient adherence beyond the effects of individual patient-specific and physician-specific factors.
It would be interesting to see if the results would be the same if applied to U.S. patients and physicians.
Health plans in the health insurance marketplaces have been competing to keep prices low, while still offering all the services mandated under the Affordable Care Act. One way to do this is to restrict provider networks to lower cost providers. For patients, restricting provider networks may be a good deal if (i) the quality of care in these restricted networks is good and (ii) they are able to readily access providers when they need them.
To answer the latter question, a paper by Haeder, Weimer, and Mukamel (2016) used a “secret shopper” survey to see how long it would take to make an appointment for primary care services. They compared wait times among health plans both inside and outside of the health insurance exchanges in California. They found that:
…obtaining access to primary care providers was generally equally challenging both inside and outside insurance Marketplaces. In less than 30 percent of cases were consumers able to schedule an appointment with an initially selected physician provider. Information about provider networks was often inaccurate.
Specifically, comparing providers both inside and outside of the Covered California exchanges, the share of providers not accepting new patients (10.2% in market places vs. 10.2% outside the marketplace), unable to reach the provider (18.0% vs. 19.0%), insurance not accepted (4.4% vs. 1.4%) and unable to get an appointment with the original provider (72.7% vs. 70.7%).
On it’s website, the Instititute for Clinical and Economic Review (ICER) claims that it is “…a trusted non-profit organization that evaluates evidence on the value of medical tests, treatments and delivery system innovations and moves that evidence into action to improve the health care system. ”
A recent article in Huffington Post however, disagrees. They make two key points.
First, although ICER claims to be independent, the ICER framework is clearly implemented from a payer (i.e., health insurer) point of view. ICER’s own website says:
ICER led an initiative to develop a conceptual framework which insurers can apply to guide their assessment of the value of medical services, including drugs, medical devices, and procedures.
HuffPo also notes that the majority of the board of directors are from insurance companies.
Second, because ICER takes a payer perspective, it does not take into account all the factors that patients value. For instance:
And “benefits” to a patient may include non-economic items such as living long enough to see lifecycle events — marriages, births, graduations and weddings, those moments that make life worth living in the first place. sadly, these unquantifiable experiences have no place in the value calculations done by those that rely on spreadsheets, apps or an abacus to apportion care.
To address this shortcoming, ICER did add two patient advocacy experts to their Governance Board. It remains to be seen, however, how their perspectives will be incorporated into ICER’s modeling decisions.
Patients with serious mental illnesses such as schizophrenia often struggle with medication adherence, due to lack of insight into their disease, medication side effects, forgetfulness, and a variety of other factors. One solution to this problem is to use long-acting injectables or LAIs. Whereas most antipsychotics are oral medications, LAIs are typically injectables that you need to get only about once per month.
Can using LAIs improve outcomes and decrease cost? According to a study by MacEwan et al., (2016), the answer is yes.
LAIs were associated with significantly lower probability of rehospitalization compared with oral antipsychotics at 60 days for schizophrenia-only patients (adjusted odds ratio [AOR]=.60, 95% confidence interval [CI]=.41–.90) and for all patients (AOR=.70, CI=.52–.95). The absolute difference in probability of rehospitalization for all patients was significantly lower by 5.0% at 60 days in the LAI group compared with the oral antipsychotics group.
Patients that receive LAIs likely have more severe form of the disease on average than patients using oral antipsychotics so the authors–which include some of my colleagues at PHE–used multivariate logistic regression and propensity score matching (PSM) methods.
“We are drowning in information, while starving for wisdom. The world henceforth will be run by synthesizers, people able to put together the right information at the right time, think critically about it, and make important choices wisely.”
In 2016 we will hit a milestone: national health spending per capita is projected to exceed $10,000 for the first time. This estimate is from an article by Keehan et al. (2016). In this paper, CMS’ Office of the Actuary (OACT) estimates costs not only this year but over the coming 10 years. According to their projects, health care costs will continue to rise.
Health spending growth in the United States for 2015–25 is projected to average 5.8 percent—1.3 percentage points faster than growth in the gross domestic product—and to represent 20.1 percent of the total economy by 2025…In addition, the share of total health expenditures paid for by federal, state, and local governments is projected to increase to 47 percent by 2025.
Although the U.S. is seen as a market-based system, the government will pay for about half of all health care spending by 2025. In the near term, OACT estimates the following growth rates between 2017-2019:
Medicare will grow the fastest due to the baby boom. OACT blames “the continued use of high-cost specialty drugs and faster growth in drug prices” for the relatively fast increase in private health insurance cost.
The answer may be yes. One of the big inpediments to value-based pricing of pharmaceuticals was that any discount given to any single organization based on outcomes needed to be reflected in the Medicaid price. Since outcomes are subject to random noise, there will inevitably be health plans that end up getting a low price due to worse than expected outcomes. If a single discount to a single plan based on idiosyncratic factors lead to large Medicaid discounts, few life sciences companies would be interested in these value-based contracts.
However, CMS is opening up an avenue to these value-based contracts in a July 2016 guidance document. First some background:
With the introduction of VBP arrangements into the pharmaceutical marketplace, manufacturers have asked CMS if these types of arrangements impact their drug’s Medicaid best price. Manufacturers are concerned that the variety of price concessions and services offered to payers in a VBP arrangement may lower the manufacturers’ best price and increase their Medicaid rebate obligations, thereby serving as a disincentive to promoting VBP arrangements.
Section 1927(c)(1)(C) of the Social Security Act defines “best price” to mean, for a single source drug or innovator multiple source drug of a manufacturer (including the lowest price available to any entity for an authorized generic drug), the lowest price available from the manufacturer during the rebate period to any wholesaler, retailer, provider, health maintenance organization, nonprofit entity, or government entity in the United States.
Now on to the good stuff. So CMS just said, if you use VBP you can ignore best price, right? Well, not exactly. Here is what they said:
To the extent a VBP arrangement provides supplemental rebates pursuant to a CMS-approved supplemental rebate agreement with the state Medicaid agency, such rebates would be excluded from best price (see 42 CFR 447.505(c)(7)). Therefore, we encourage states and manufacturers to consider negotiating supplemental rebates as part of VBP arrangements.
So it says they are encouraging VBP but they these VBP arrangements must be “CMS-approved” in order for them to be exempt from the “best price” regulation. What the approval process is and how long it will take is not clear, but I think this is at least a step in the right direction towards allowing payment based on outcomes rather than volume.