Are Value-Based Arrangements the Answer We've Been Waiting for?

In response to rising healthcare costs, value-based arrangements (VBAs) have emerged as a mechanism for transforming how we pay for high-cost therapies. As we think about how VBAs fit into the larger effort of the United States healthcare system to transition to value-based payment, it is important to consider the strengths and limitations associated with this model and to set appropriate expectations for what VBAs can realistically achieve. For example, for VBAs to meaningfully affect overall healthcare spending, there needs to be a sufficient number of products that meet the ideal criteria for a value-based contract. These products also need to represent a meaningful share of healthcare spending, and the VBA contracts need to be designed with enough financial risk to actually influence spending. Although there are limited data about the components of current contracts (eg, how much financial risk is involved, product and class specifications), VBAs will likely not be a singular solution for improving healthcare cost containment. Instead, VBAs offer an opportunity for the US healthcare system to achieve higher value for dollars spent when implemented in combination with other value-based payment mechanisms and policies that disincentivize low-value care.

As Value Assessment Frameworks Evolve, Are They Finally Ready for Prime Time?

BACKGROUND: Value assessment frameworks have emerged as tools to assist healthcare decision makers in the United States in assessing the relative value of healthcare services and treatments. As more healthcare decision makers in the United States-including state government agencies, pharmacy benefit managers, employers, and health plans-publicly consider the adoption of value frameworks, it is increasingly important to critically evaluate their ability to accurately measure value and reliably inform decision making. OBJECTIVE: To examine the evolution of the value assessment landscape in the past two years, including new entrants and updated frameworks, and assess if these changes successfully advance the field of value assessment. METHODS: We analyzed the progress of the three currently active value assessment frameworks developed by the Institute for Clinical and Economic Review, the Innovation and Value Initiative, and the National Comprehensive Cancer Network, against six key areas of concern. RESULTS: Value assessment frameworks are moving closer to meeting the challenge of accurately measuring value and reliably informing healthcare decisions. Each of the six concerns has been addressed in some way by at least one framework. CONCLUSIONS: Although value assessments are potential inputs that can be considered for healthcare decision making, none of them should be the sole input for these decisions. Considering the limitations, they should, at most, be only one of many tools in the toolbox.

Reconciling the Seemingly Irreconcilable: How Much Are We Spending on Drugs?

BACKGROUND: Estimates of drug spending are often central to the public policy debate on how to manage healthcare spending in the United States. Nevertheless, common estimates of prescription drug spending vary substantially by source, which can inhibit productive policy dialogue. OBJECTIVES: To review publicly reported estimates of drug spending and uncover the underlying methodological inputs that drive the substantial variation in estimates of prescription drug spending. METHODS: We systematically evaluated 5 estimates of drug spending to identify differences in the underlying methodological inputs and approaches. To uniformly assess and compare estimates, we developed a model to identify the inputs of 3 primary components associated with each estimate: numerator (How is drug cost measured?), denominator (How is healthcare cost measured?), and population (What group of individuals is included in the measurement?). We then applied standardized methodological inputs to each estimate to assess whether variation among estimates could be reconciled. We then conducted a sensitivity analysis to address important limitations. RESULTS: We found that the 18.8 percentage point range in the publicly reported estimates is predominately attributed to methodological differences. Reconciling estimates using a standardized methodological approach reduces this range to 4.0 percentage points. CONCLUSIONS: Because variation in estimates of drug spending is primarily driven by methodological differences, stakeholders should seek to establish a mutually agreed upon methodological approach that is appropriate for the policy question at hand to provide a sound basis for health spending policy discussions.

Association between adherence with oral anticancer medications and short-term health care resource utilization: A 2010-2018 claims-based analysis.

BACKGROUND: There is limited evidence on the effect of adherence to oral anticancer medications on health care resource utilization (HRU) among patients with cancer. OBJECTIVE: To determine the association between adherence to oral anticancer medication and subsequent HRU. METHODS: A retrospective cohort study was conducted using Optum Clinformatics® Data Mart commercial claims database. Patients who initiated an oral anticancer medication between 2010 and 2017 were included. Proportion of days covered was used to calculate medication adherence in the first 6 months after oral anticancer medication initiation. All-cause HRU in the following 6 months was assessed. Multivariable negative binomial regressions were used to determine the association between oral anticancer medication adherence and HRU, after controlling for confounders. RESULTS: Of 37,938 patients, 51.9% were adherent to oral anticancer medications. Adherence with oral anticancer medication was significantly associated with more frequent physician office and outpatient visits for several cancer types with the strongest association among those with liver cancer (adjusted incidence rate ratio [aIRR] = 1.34; 95% CI = 1.18-1.52 and aIRR = 1.32; 95% CI = 1.13-1.55, respectively). Oral anticancer medication adherence was associated with more emergency department visits only among patients with lung cancer (aIRR = 1.22; 95% CI = 1.01-1.48). Oral anticancer medication adherence was significantly associated with a higher rate of inpatient hospitalizations and longer stays among patients with liver cancer (aIRRs were 1.45 [95% CI = 1.02-2.05] and 2.15 [95% CI = 1.21-3.81], respectively), whereas hospitalizations were fewer and length of stay was shorter among patients with colorectal cancer who were adherent with oral anticancer medication (aIRRs were 0.77 [95% CI = 0.68-0.86] and 0.77 [95% CI = -0.66 to 0.90], respectively). Other measures did not reveal statistically significant differences in HRU among adherent and nonadherent patients for the cancer types included in the study. CONCLUSIONS: HRU following the initial phase of oral anticancer medication therapy was generally similar among adherent and nonadherent patients. We observed a slightly higher rate of office and outpatient visits among adherent patients, which may reflect ongoing monitoring among patients continuing oral anticancer medication. Further studies are needed to determine how oral anticancer medication adherence may affect HRU over a longer time period.

Payer perceptions and use of value assessment tools in the United States.

BACKGROUND: As the United States transitions toward value-based payment, value assessment tools to measure the value of health care interventions are emerging. As the field evolves, it is important to evaluate how these tools are influencing treatment and coverage decisions. OBJECTIVE: To examine payer perceptions and use of US value assessment tools and identify how these tools inform payer decision-making. METHODS: A double-blind, web-based survey was conducted from June to July 2022 to assess health care payers' perceptions and use of value assessment tools developed by the American Society of Clinical Oncology, Drug Pricing Lab, Institute for Clinical and Economic Review (ICER), Innovation and Value Initiative, and National Comprehensive Cancer Network. RESULTS: 51 respondents completed the survey. 86% of payers were familiar with at least 4 of 5 value assessment tools. Both ICER and National Comprehensive Cancer Network tools are perceived as very useful for informing formulary decisions (57% and 49%, respectively). When selecting a value assessment tool, payers identified the inclusion of appropriate metrics and outcomes (92%), comparative clinical effectiveness information (88%), and reliance on rigorous, unbiased methods (86%) to be very/extremely important. Payers reported the inclusion of the patient, provider, and societal perspectives as lower importance (32%, 31%, and 20% identify these elements as very/extremely important, respectively). Payers reported using ICER evidence reports to both expand and restrict coverage decisions. To advance more useful and relevant value assessment tools, payers identified the need for greater stakeholder awareness of existing tools, and some recommended that value assessors increase the volume of assessments conducted. CONCLUSIONS: US health care payers perceive select value assessment tools to be useful for informing health care decisions. As policy momentum behind value assessment builds, additional examination of value assessment tools is needed to inform appropriate application of value assessment in US health care decision-making. DISCLOSURES: This study was funded by Xcenda/AmerisourceBergen. Ms Buelt, Ms Loo, Ms Westrich, and Drs Hydery and Zheng report employment with Xcenda/AmerisourceBergen. Drs Dharbhamalla and Graff report employment with AMCP.

Specialty drug and health care utilization vary by wage level in employer-sponsored health plans.

BACKGROUND: Expenditures on specialty medications for autoimmune conditions (SpRx-AIC) have increased considerably in recent years, raising affordability concerns for employers and other plan sponsors and resulting in greater patient cost-sharing. Among those commercially insured, prior studies have shown differential patterns of health care utilization in association with wage, though no data are available for SpRx-AIC. Notably, out-of-pocket costs associated with SpRx-AIC have been shown to impact medication adherence, particularly for low-income households. OBJECTIVE: To assess the association of wage status on SpRx-AIC and health care services use and cost among employees with employer-sponsored health insurance. METHODS: Employee health care claims and wage data were obtained from the IBM Watson MarketScan database for calendar year 2018. Midyear employee wage data were used as a basis for allocating employees into annual income quartiles: $47,000 or less, $47,001-$71,000, $71,001-$106,000, and $106,001 or more. The lowest quartile was further divided into 2 groups ($35,000 or less and $35,001-$47,000) to better evaluate subgroup differences at lower wage levels. Outcomes included monthly days supply of SpRx-AIC, medication discontinuation rates (medication cessation for ≥ 90 days), proportion of days covered (PDC), medical services utilization rates per 1,000, and allowed payment amounts. Generalized linear regressions were used to assess differences while adjusting for patient characteristics, including age, gender, plan type, region, median household income, deductible amount, comorbidity index, and psychiatric diagnostic scores. RESULTS: From a sample of more than 2 million enrollees, 148,761 (7.2%) were identified as having an autoimmune disorder of interest. Of those, 17,096 (11.5%) had filled at least one SpRx-AIC prescription. Following adjustment, SpRx-AIC use was significantly less among the lowest wage group compared with the highest wage group (10.1% vs 11.7%; P < 0.0001). Days supply was significantly lower in the lowest wage group (244.4 vs 258.0; P < 0.001), as was PDC (0.74 vs 0.76; P < 0.001). In the lowest wage group, medical services utilization was significantly higher for inpatient admissions (0.08 vs 0.05; P = 0.002) and emergency department visits (0.52 vs 0.16; P < 0.0001). There were no significant differences among wage groups in SpRx-AIC discontinuation, outpatient services use, or health care costs. CONCLUSIONS: Low-wage employees with autoimmune conditions are significantly less likely to use an SpRx-AIC and have a lower monthly supply and PDC when SpRx-AIC was used. They are more likely to be admitted to the hospital and have more emergency department visits. These findings raise concerns about employer benefit design inequities for SpRx-AIC access and the resulting potential adverse impact on health care costs and employee functional status. DISCLOSURES: National Pharmaceutical Council, Genentech, and TrialCard provided funding support for this study, with funding administered by the National Alliance of Healthcare Purchaser Coalitions. Genentech and TrialCard provided comments regarding the final manuscript draft; National Pharmaceutical Council employees were actively engaged in study design, analysis and interpretation of results, and manuscript preparation. Dr Sherman is a consultant to National Alliance of Healthcare Purchaser Coalitions. Mr Sils and Ms Westrich were employees of the National Pharmaceutical Council at time of study. Ms Kamen is an employee of IBM Watson Health.

Predictors of adherence to oral anticancer medications: An analysis of 2010-2018 US nationwide claims.

BACKGROUND: Various factors, including patient demographic and socioeconomic characteristics, patient out-of-pocket (OOP) costs, therapy-related factors, clinical characteristics, and health-system factors, can affect patient adherence to oral anticancer medications (OAMs). OBJECTIVE: To determine the proportion of patients initiating oral anticancer therapy who were adherent to OAMs and to identify significant predictors of adherence to OAMs, including patient OOP costs and patient demographics. METHODS: A retrospective cohort study was conducted using data from Optum Clinformatics Data Mart commercial claims database for 2010-2018. Patients with a new pharmacy claim for an OAM between July 1, 2010, and December 31, 2017, were followed for 6 months to ascertain their medication adherence, which was defined as a proportion of days covered value of at least 0.8. Average monthly patient OOP costs for OAM prescriptions were categorized as lower OOP costs (quartiles 1-3) and higher OOP costs (quartile 4). Separate multivariable logistic regressions were conducted to identify predictors of OAM nonadherence for each cancer type. RESULTS: Out of 37,938 patients with cancer, 51.9% were adherent to OAMs, with adherence ranging from 32.8% among those with liver cancer to 70.4% among those with brain tumor. The average monthly OOP costs of OAMs also differed by cancer type, ranging from $749 (SD = $1,014) among patients with blood cancer to $106 (SD = $439) among those with prostate cancer. Higher patient OOP costs were associated with higher odds of OAM nonadherence for many cancer types, including renal cancer (adjusted odds ratio [AOR] = 3.91; 95% CI = 2.80-5.47) and breast cancer (AOR = 1.26; 95% CI = 1.13-1.41). Additionally, patients with inpatient hospitalizations during the 6 months following OAM initiation had significantly higher odds of OAM nonadherence for all cancer types except for stomach cancer. Among patients with stomach cancer, male sex was associated with lower odds of OAM nonadherence (AOR = 0.60; 95% CI = 0.37-0.97). Among patients with renal or stomach cancer, those who had Medicare low-income subsidy had higher odds of OAM nonadherence compared with those with commercial insurance coverage. Among patients with blood cancers, Black and Hispanic patients had higher odds of OAM nonadherence compared with White patients (AOR = 1.48; 95% CI = 1.25-1.75 and AOR = 1.38; 95% CI = 1.13-1.68, respectively). CONCLUSIONS: Overall adherence to OAMs was suboptimal, and for several cancer types, adherence was worse among patients with higher OOP costs, those who were hospitalized, and those who received Medicare low-income subsidy. Policies addressing cost and access to OAMs and health-system strategies to address barriers to the effective use of OAMs are needed to improve patient access to these vital medications. DISCLOSURES: This study was funded by joint funding from the Pharmacy Quality Alliance and the National Pharmaceutical Council (NPC). Drs Vyas and Kogut were partially supported by this joint funding. Mr Descoteaux was supported by this joint funding for performing data analysis. The content is solely the responsibility of the authors and does not necessarily represent the official views of PQA or NPC. Dr Campbell completed this work during his employment at Pharmacy Quality Alliance; he is now an employee of Merck Sharp & Dohme Corp., a subsidiary of Merck & Co., Inc., Kenilworth, NJ.

Stakeholder perception of pharmaceutical value: A multicriteria decision analysis pilot case study for value assessment in the United States.

BACKGROUND: Recent attention to value frameworks has highlighted limitations of current conventional value and health technology assessment (V/HTA) methods (eg, cost-effectiveness). Multicriteria decision analysis (MCDA) has potential as a supplemental tool to incorporate additional value criteria into conventional value assessment. OBJECTIVE: To conduct a pilot study to illustrate the impact of an MCDA approach on the value perceptions of hypothetical treatment profiles from a multistakeholder panel. METHODS: Participants voted on value perceptions of 2 hypothetical treatments with similar cost-effectiveness evidence: Treatment A for aggressive B-cell non-Hodgkin lymphoma in adults and treatment B for episodic migraine in adults. Participants voted treatments A and B as low, intermediate, or high value before and after a weighting exercise on prespecified, additional value criteria. Weights from participants were used to calculate treatment-specific MCDA scores from 0 (least favorable) to 100 (most favorable) and were presented to participants for a second value-perception vote. Analyses compared changes in value perceptions within treatments A and B post-MCDA exercise. RESULTS: Before considering MCDA scores for treatment A, 0% of participants considered it to be low, 52% intermediate, and 48% high value. After considering MCDA scores for treatment A, 4% considered it low, 29% intermediate, and 67% high value. Both before and after considering MCDA scores for treatment B, 13%, considered it low, 57% intermediate, and 30% high value. Mean MCDA scores for treatments A and B were 67 and 63, respectively. Of all stakeholders, 41% altered their perception of value for treatment A (9% negatively and 32% positively) and, separately, 45% for treatment B (23% both negatively and positively) after considering MCDA scores. CONCLUSIONS: With nearly half of participants altering their perception of value after consideration of additional value criteria, findings support the need for a more inclusive and flexible value assessment process. DISCLOSURES: This study was funded by The National Pharmaceutical Council. Dr Perfetto was employed by the National Health Council (NHC) at the time this work was completed, and all honoraria and consulting and travel fees were paid to the NHC. The NHC is a not-for-profit, membership organization. It is supported through membership dues and sponsorship funds. The complete list of members and sponsors is located on the NHC's website at www.nationalhealthcouncil.org. She is also an advisor for the Brain Injury Association of America, Dan Lewis Foundation, and Canter for Medical Technology Policy.

The patient's medication access journey: a conceptual framework focused beyond adherence.

BACKGROUND: It is well known that medication accessibility reduces morbidity and mortality and increases health-related quality of life; however, despite efforts to improve health care access, many Americans still face challenges in accessing medications. Several health care access and utilization conceptual frameworks have been created and used for decades to illustrate key relationships and interdependencies between elements of the system. However, none of these frameworks have focused exclusively on medication access and associated factors. Medication access is a complex, multidimensional issue that must consider not only patient-specific challenges, but also health system limitations, among others. A better understanding of medication access, beyond the proxy marker of adherence, is needed to identify opportunities to improve accessibility. OBJECTIVE: To develop a conceptual framework that defines a patient's medication access journey and characterizes barriers frequently encountered while seeking medication access. METHODS: A multistakeholder roundtable composed of 15 experts from across the health care continuum was convened in 2018 by the Pharmacy Quality Alliance to develop a conceptual framework for medication access. The roundtable participants were convened through in-person and telephonic meetings. To inform their work, 2 literature reviews and an environmental scan were conducted to identify medication access barriers, interventions affecting medication access, and medication access quality measures. RESULTS: The resulting framework included 7 nodes that represent the major access points encountered by patients when attempting to access medications: perceived need, help seeking, encounter, prescribing, prescription adjudication, prescription dispensing, and adherence. Also, 18 barriers were identified. Patient health literacy, cost, insurance, and organizational health literacy were predominant barriers across multiple nodes. CONCLUSIONS: The framework that was developed provides a patient-focused, holistic view of medication access, incorporating access nodes and corresponding barriers. It also provides a structure to consider key opportunities for interventions and measurement to address medication access challenges. DISCLOSURES: This study was conducted with grant support from the National Pharmaceutical Council, which served as a collaborator in the study. Westrich is employed by the National Pharmaceutical Council. Nelson is employed by the Pharmacy Quality Alliance, which was contracted to conduct this study. Pickering, Campbell, and Holland were employed by the Pharmacy Quality Alliance at the time of this study. This research was presented as a professional poster at the American Public Health Association Annual Meeting in October 2019, Philadelphia, PA.

Improving patient-reported measures in oncology: a payer call to action.

Despite rising interest in integrating the patient voice in value-based payment (VBP) models for oncology, barriers persist to implementing patient-reported measures (PRMs), including patient-reported performance measures (PR-PMs). This article describes the landscape of oncology PRMs and PR-PMs, identifies implementation barriers, and recommends solutions for public and private payers to accelerate the appropriate use of PRMs in oncology VBP programs. Our research used a multimethod approach that included a literature review, landscape scan, stakeholder interviews and survey, and a multistakeholder roundtable. The literature review and landscape scan found that limited oncology-specific PR-PMs are available and some are already used in VBP programs. Diverse stakeholder perspectives provided insight into filling current gaps in measurement and removing implementation barriers, such as limited relevance of existing PRMs and PR-PMs for oncology; methodological challenges; patient burden and survey fatigue; and provider burden from resource constraints, competing priorities, and insufficient incentives. Key recommendations include: (a) identify or develop meaningful measures that fill gaps, engaging patients throughout measure and program development and evaluation; (b) design programs that include scientifically sound measures standardized to reduce patient and provider burden while supporting care; and (c) engage providers using a stepwise approach that offers resources and incentives to support implementation. DISCLOSURES: Funding for this project was provided by the National Pharmaceutical Council. Schmidt, Perkins, Riposo, and Patel are employees of Discern Health, a consulting firm with many clients, including government, life sciences, nonprofit, and provider organizations. Valuck is a partner at Discern Health. Westrich is an employee of the National Pharmaceutical Council, an industry-funded health policy research group that is not involved in lobbying or advocacy. Basch reports grants from National Cancer Institute and Patient-Centered Outcomes Research Institute; fees from serving as a consultant on research projects at Memorial Sloan Kettering Cancer Center, Dana-Farber Cancer Institute, and Research Triangle Institute/CMS; and fees from serving as a scientific advisor to CareVive Systems, Sivan Healthcare, Navigating Cancer, and AstraZeneca, outside the submitted work. McClellan reports fees from serving on the boards of Johnson & Johnson and Seer Bio and as an advisor to Cota outside the submitted work; and McClellan is an independent board member on the boards of Cigna and Alignment Healthcare, co-chair of the Guiding Committee for the Health Care Payment Learning and Action Network, and receives fees for serving as an advisor for MITRE, outside the submitted work.

Evolution of ACO readiness to optimize medication use: are we there yet?

DISCLOSURES: No funding contributed to the writing of this commentary. The authors have nothing to disclose.

Underestimating the Value of an Intervention: The Case for Including Productivity in Value Assessments and Formulary Design.

BACKGROUND: Value assessment reports are increasingly being considered in health care coverage decisions. The inputs included and analytic methodologies underlying these reports should include all components of value. OBJECTIVE: To determine whether and how productivity was included in a value assessment, compare the incremental cost per quality-adjusted life-year (cost/QALY) estimates with and without productivity, assess if inclusion of productivity changed the value category and estimate the direction and magnitude of change. METHODS: We reviewed pharmaceutical value assessment reports published between March 2017 and July 2019 by the Institute for Clinical and Economic Review (ICER) to determine whether productivity was included and how it was reported (i.e., co-base case or scenario analysis). Within each report, we identified unique treatment comparisons for which modelers estimated an incremental cost/QALY. We categorized the incremental cost/QALY estimates using ICER's willingness-to-pay (WTP) categories and assessed if inclusion of productivity changed the value category (i.e., < $50,000/QALY). For reports that included 2 numerical estimates, we assessed the direction and magnitude of change when productivity was included. RESULTS: Of the 19 reports that evaluated pharmaceutical treatments, 18 (94.7%) included productivity. Two reports (11.1%) incorporated productivity in a co-base case analysis, and 16 included productivity in a scenario analysis. Across these 18 reports, there were 75 unique comparisons of pharmaceutical interventions. Across the 75 comparisons, 4 (5.3%), 3 (4.0%), 8 (10.6%), and 1 (1.3%) of the coverage decisions would change at the $50,000/QALY, $100,000/QALY, $150,000/QALY, and $500,000/QALY threshold, respectively. Sixty comparisons included 2 numerical cost/QALY estimates. The magnitude of change in the cost/QALY, after including productivity, ranged from -80.1% to 6.8%. The estimated value increased for 54 (72%), decreased for 5 (6.6%), and did not change for 1 (1.7%) of the comparisons. CONCLUSIONS: Value assessment should capture the range of costs and benefits of an intervention. The exclusion of productivity costs can alter, often underestimating, the assessment of value. This may affect coverage decisions-inclusion or exclusion from the insurance benefit-based on these assessments. Value assessment reports intended to be used for health care decision making should include productivity and elevate its visibility by using base-case analyses rather than scenario analyses. DISCLOSURES: This study was funded by the National Pharmaceutical Council. Karmarkar is currently a postdoctoral fellow at the National Pharmaceutical Council. Graff and Westrich are employees of the National Pharmaceutical Council, which provides unrestricted research grants to value assessment bodies including ICER and IVI.

Are ACOs Ready to be Accountable for Medication Use?

BACKGROUND: Accountable care organizations (ACOs) have the potential to lower costs and improve quality through incentives and coordinated care. However, the design brings with it many new challenges. One such challenge is the optimal use of pharmaceuticals. Most ACOs have not yet focused on this integral facet of care, even though medications are a critical component to achieving the lower costs and improved quality that are anticipated with this new model. OBJECTIVE: To evaluate whether ACOs are prepared to maximize the value of medications for achieving quality benchmarks and cost offsets. METHODS: During the fall of 2012, an electronic readiness self-assessment was developed using a portion of the questions and question methodology from the National Survey of Accountable Care Organizations, along with original questions developed by the authors. The assessment was tested and subsequently revised based on feedback from pilot testing with 5 ACO representatives. The revised assessment was distributed via e-mail to a convenience sample (n=175) of ACO members of the American Medical Group Association, Brookings-Dartmouth ACO Learning Network, and Premier Healthcare Alliance. RESULTS: The self-assessment was completed by 46 ACO representatives (26% response rate). ACOs reported high readiness to manage medications in a few areas, such as transmitting prescriptions electronically (70%), being able to integrate medical and pharmacy data into a single database (54%), and having a formulary in place that encourages generic use when appropriate (50%). However, many areas have substantial room for improvement with few ACOs reporting high readiness. Some notable areas include being able to quantify the cost offsets and hence demonstrate the value of appropriate medication use (7%), notifying a physician when a prescription has been filled (9%), having protocols in place to avoid medication duplication and polypharmacy (17%), and having quality metrics in place for a broad diversity of conditions (22%). CONCLUSIONS: Developing the capabilities to support, monitor, and ensure appropriate medication use will be critical to achieve optimal patient outcomes and ACO success. The ACOs surveyed have embarked upon an important journey towards this goal, but critical gaps remain before they can become fully accountable. While many of these organizations have begun adopting health information technologies that allow them to maximize the value of medications for achieving quality outcomes and cost offsets, a significant lag was identified in their inability to use these technologies to their full capacities. In order to provide further guidance, the authors have begun documenting case studies for public release that would provide ACOs with examples of how certain medication issues have been addressed by ACOs or relevant organizations. The authors hope that these case studies will help ACOs optimize the value of pharmaceuticals and achieve the "triple aim" of improving care, health, and cost. DISCLOSURES: There was no outside funding for this study, and the authors report no conflicts of interest related to the article. Concept and design were primarily from Dubois and Kotzbauer, with help from Feldman, Penso, and Westrich. Data collection was done by Feldman, Penso, Pope, and Westrich, and all authors participated in data interpretation. The manuscript was written primarily by Westrich, with help from all other authors, and revision was done primarily by Lustig and Westrich, with help from all other authors.

US care pathways: continued focus on oncology and outstanding challenges.

OBJECTIVES: To update an ongoing assessment of care pathway development, implementation, and evaluation, and to evaluate the emerging relationship between care pathways and other components of value-based care. STUDY DESIGN: Targeted literature review followed by an online survey and in-depth interviews. METHODS: The PubMed/Cochrane databases and gray literature were searched for publications on care pathways (January 1, 2014, to March 3, 2017); a supplemental targeted search was completed in October 2017. Qualitative data were collected via an online survey and semistructured, in-depth interviews with payers, providers, pathway vendors, and opinion leaders. RESULTS: A total of 112 articles or posters were identified in recently published research. The survey and interviews included 32 and 19 respondents, respectively. Care pathways are increasingly driven by providers and provider networks. Overall, we found increased awareness of and adherence to codified best practices or standards, and prioritization of high-quality evidence during development. Research findings suggest stronger links between outcomes-based measures and both physician reimbursement and care pathway evaluation. Integration with other value-based care initiatives, including alternative payment models, is also gradually emerging. CONCLUSIONS: This study identified growing use of high standards of evidence and adoption of other best practices in the development, implementation, and evaluation of care pathways. As the influence of care pathways on patient care continues to expand, additional efforts are needed to increase transparency, disclose conflicts of interest, engage with patients, effectively align care pathways with improvements in patient outcomes, and integrate efficiently with other value-based care initiatives.

Value-based arrangements may be more prevalent than assumed.

OBJECTIVES: To better understand the prevalence of US value-based payment arrangements (VBAs), their characteristics, and the factors that facilitate their success or act as barriers to their implementation. STUDY DESIGN: Surveys were administered to a convenience sample of subject matter experts who were senior representatives from payer organizations and biopharmaceutical manufacturers. These data were supplemented with qualitative interviews in a subsample of survey respondents. METHODS: Descriptive statistics, including percentages for categorical values and mean (SD) and median (interquartile range) for continuous variables, were assessed for quantitative questions. Trained reviewers collated responses to free-text survey questions and the qualitative interviews to identify themes. RESULTS: Of the 25 respondents, 1 manufacturer and 4 payers reported not having explored or negotiated any VBAs. Subsequently, questionnaire results from 11 biopharmaceutical manufacturers and 9 payers who had experience with VBAs were analyzed. More than 70% of VBAs implemented between 2014 and 2017 were not publicly disclosed. Furthermore, although consideration of VBAs as a coverage and payment tool is increasing, VBA implementation is relatively low, with manufacturers and payers reporting that approximately 33% and 60% of early dialogues translate into signed VBA contracts, respectively. Respondents' reasoning for VBA negotiation process breakdowns generally differed by sector and reflected each sector's respective priorities. CONCLUSIONS: This study reveals that the majority of VBAs are not publicly disclosed, which could underestimate their true prevalence and impact. Given the effort required to implement a VBA, future arrangements would likely benefit from a framework or other evaluative tool to help assess VBA pursuit desirability and guide the negotiation and implementation process.

Why Value Framework Assessments Arrive at Different Conclusions: A Multiple Myeloma Case Study.

As the United States transitions from a volume-based health care system to one that rewards value, new frameworks are emerging to help patients, providers, and payers assess the value of medical services and biopharmaceutical products. These value assessment frameworks are intended to support various types of health care decision making. They have the potential to substantially affect patients, whether as tools for shared decision making with their doctors, as an input to care pathways used by providers, or through payer use of the frameworks to make coverage or reimbursement decisions. Prominent among current U.S. value assessment frameworks are those developed by the American Society of Clinical Oncology, the Institute for Clinical and Economic Review, the Memorial Sloan Kettering Cancer Center, and the National Comprehensive Cancer Network. These frameworks generally reflect the interests and expertise of the organizations that developed them. The evidence, methodology, and intended use differ substantially across frameworks, which can lead to highly variable determinations of value for the same treatment therapy. To demonstrate this variability, we explored how these frameworks assess the value of treatment regimens for multiple myeloma. Cross-framework comparisons of multiple myeloma assessments were conducted, and consistency of findings was examined for 3 case studies. A discussion of the analysis explores why different frameworks arrive at different conclusions, whether those differences are cause for concern, and the resulting implications for framework readiness to support health care decision making. DISCLOSURES: Funding for this project was provided by the National Pharmaceutical Council. The authors are employees of the National Pharmaceutical Council, an industry-funded health policy research group that is not involved in lobbying or advocacy. Study concept and design were contributed by Westrich and Dubois, along with Buelt. Westrich took the lead in data collection, along with Dubois, and data interpretation was performed by all the authors. The manuscript was written by Westrich and Buelt, along with Dubois, and revised by all the authors.

Optimization of Medication Use at Accountable Care Organizations.

BACKGROUND: Optimized medication use involves the effective use of medications for better outcomes, improved patient experience, and lower costs. Few studies systematically gather data on the actions accountable care organizations (ACOs) have taken to optimize medication use. OBJECTIVES: To (a) assess how ACOs optimize medication use; (b) establish an association between efforts to optimize medication use and achievement on financial and quality metrics; (c) identify organizational factors that correlate with optimized medication use; and (d) identify barriers to optimized medication use. METHODS: This cross-sectional study consisted of a survey and interviews that gathered information on the perceptions of ACO leadership. The survey contained a medication practices inventory (MPI) composed of 38 capabilities across 6 functional domains related to optimizing medication use. ACOs completed self-assessments that included rating each component of the MPI on a scale of 1 to 10. Fisher's exact tests, 2-proportions tests, t-tests, and logistic regression were used to test for associations between ACO scores on the MPI and performance on financial and quality metrics, and on ACO descriptive characteristics. RESULTS: Of the 847 ACOs that were contacted, 49 provided usable survey data. These ACOs rated their own system's ability to manage the quality and costs of optimizing medication use, providing a 64% and 31% affirmative response, respectively. Three ACOs achieved an overall MPI score of 8 or higher, 45 scored between 4 and 7.9, and 1 scored between 0 and 3.9. Using the 3 score groups, the study did not identify a relationship between MPI scores and achievement on financial or quality benchmarks, ACO provider type, member volume, date of ACO creation, or the presence of a pharmacist in a leadership position. Barriers to optimizing medication use relate to reimbursement for pharmacist integration, lack of health information technology interoperability, lack of data, feasibility issues, and physician buy-in. CONCLUSIONS: Compared with 2012 data, data on ACOs that participated in this study show that they continue to build effective strategies to optimize medication use. These ACOs struggle with both notification related to prescription use and measurement of the influence optimized medication use has on costs and quality outcomes. Compared with the earlier study, these data find that more ACOs are involving pharmacists directly in care, expanding the use of generics, electronically transmitting prescriptions, identifying gaps in care and potential adverse events, and educating patients on therapeutic alternatives. ACO-level policies that facilitate practices to optimize medication use are needed. Integrating pharmacists into care, giving both pharmacists and physicians access to clinical data, obtaining physician buy-in, and measuring the impact of practices to optimize medication use may improve these practices. DISCLOSURES: This research was sponsored and funded by the National Pharmaceutical Council (NPC), an industry funded health policy research group that is not involved in lobbying or advocacy. Employees of the sponsor contributed to the research questions, determination of the relevance of the research questions, and the research design. Specifically, there was involvement in the survey and interview instruments. They also contributed to some data interpretation and revision of the manuscript. Leavitt Partners was hired by NPC to conduct research for this study and also serves a number of health care clients, including life sciences companies, provider organizations, accountable care organizations, and payers. Westrich and Dubois are employed by the NPC. Wilks, Krisle, Lunner, and Muhlestein are employed by Leavitt Partners and did not receive separate compensation. Study concept and design were contributed by Krisle, Dubois, and Muhlestein, along with Lunner and Westrich. Krisle and Muhlestein collected the data, and data interpretation was performed by Wilks, Krisle, and Muhlestein, along with Dubois and Westrich. The manuscript was written primarily by Wilks, along with Krisle and Muhlestein, and revised by Wilks, Westrich, Lunner, and Krisle. Preliminary versions of this work were presented at the following: National Council for Prescription Drug Programs Educational Summit, November 1, 2016; Academy Health 2016 Annual Research Meeting, June 27, 2016; Accountable Care Learning Collaborative Webinar, June 16, 2016; the 21st Annual PBMI Drug Benefit Conference, February 29, 2016; National Value-Based Payment and Pay for Performance Summit, February 17, 2016; National Accountable Care Congress, November 17, 2015; and American Journal of Managed Care's ACO Emerging Healthcare Delivery Coalition, Fall 2015 Live Meeting, October 15, 2015.

Optimization of Medication Use at Accountable Care Organizations.

BACKGROUND: Optimized medication use involves the effective use of medications for better outcomes, improved patient experience, and lower costs. Few studies systematically gather data on the actions accountable care organizations (ACOs) have taken to optimize medication use. OBJECTIVES: To (a) assess how ACOs optimize medication use; (b) establish an association between efforts to optimize medication use and achievement on financial and quality metrics; (c) identify organizational factors that correlate with optimized medication use; and (d) identify barriers to optimized medication use. METHODS: This cross-sectional study consisted of a survey and interviews that gathered information on the perceptions of ACO leadership. The survey contained a medication practices inventory (MPI) composed of 38 capabilities across 6 functional domains related to optimizing medication use. ACOs completed self-assessments that included rating each component of the MPI on a scale of 1 to 10. Fisher's exact tests, 2-proportions tests, t-tests, and logistic regression were used to test for associations between ACO scores on the MPI and performance on financial and quality metrics, and on ACO descriptive characteristics. RESULTS: Of the 847 ACOs that were contacted, 49 provided usable survey data. These ACOs rated their own system's ability to manage the quality and costs of optimizing medication use, providing a 64% and 31% affirmative response, respectively. Three ACOs achieved an overall MPI score of 8 or higher, 45 scored between 4 and 7.9, and 1 scored between 0 and 3.9. Using the 3 score groups, the study did not identify a relationship between MPI scores and achievement on financial or quality benchmarks, ACO provider type, member volume, date of ACO creation, or the presence of a pharmacist in a leadership position. Barriers to optimizing medication use relate to reimbursement for pharmacist integration, lack of health information technology interoperability, lack of data, feasibility issues, and physician buy-in. CONCLUSIONS: Compared with 2012 data, data on ACOs that participated in this study show that they continue to build effective strategies to optimize medication use. These ACOs struggle with both notification related to prescription use and measurement of the influence optimized medication use has on costs and quality outcomes. Compared with the earlier study, these data find that more ACOs are involving pharmacists directly in care, expanding the use of generics, electronically transmitting prescriptions, identifying gaps in care and potential adverse events, and educating patients on therapeutic alternatives. ACO-level policies that facilitate practices to optimize medication use are needed. Integrating pharmacists into care, giving both pharmacists and physicians access to clinical data, obtaining physician buy-in, and measuring the impact of practices to optimize medication use may improve these practices. DISCLOSURES: This research was sponsored and funded by the National Pharmaceutical Council (NPC), an industry funded health policy research group that is not involved in lobbying or advocacy. Employees of the sponsor contributed to the research questions, determination of the relevance of the research questions, and the research design. Specifically, there was involvement in the survey and interview instruments. They also contributed to some data interpretation and revision of the manuscript. Leavitt Partners was hired by NPC to conduct research for this study and also serves a number of health care clients, including life sciences companies, provider organizations, accountable care organizations, and payers. Westrich and Dubois are employed by the NPC. Wilks, Krisle, Lunner, and Muhlestein are employed by Leavitt Partners and did not receive separate compensation. Study concept and design were contributed by Krisle, Dubois, and Muhlestein, along with Lunner and Westrich. Krisle and Muhlestein collected the data, and data interpretation was performed by Wilks, Krisle, Muhlestein, along with Dubois and Westrich. The manuscript was written primarily by Wilks, along with Krisle and Muhlestein, and revised by Wilks, Westrich, Lunner, and Krisle. Preliminary versions of this work were presented at the following: National Council for Prescription Drug Programs Educational Summit, November 1, 2016; Academy Health 2016 Annual Research Meeting, June 27, 2016; Accountable Care Learning Collaborative Webinar, June 16, 2016; the 21st Annual PBMI Drug Benefit Conference, February 29, 2016; National Value-Based Payment and Pay for Performance Summit, February 17, 2016; National Accountable Care Congress, November 17, 2015; and American Journal of Managed Care's ACO Emerging Healthcare Delivery Coalition, Fall 2015 Live Meeting, October 15, 2015.

What do pharmaceuticals really cost in the long run?

OBJECTIVES: To estimate the long-run average cost (LAC) for a typical drug, accounting for the effects of generic competition and medical cost offsets. STUDY DESIGN: Descriptive analysis of retrospective cross-sectional survey data. METHODS: We estimated the LAC for a drug as the average price per unit paid over the lifecycle of the drug, discounted across all time periods using Medical Expenditure Panel Survey data, and accounted for the effects of generic competition and medical cost offsets attributable to the use of pharmaceuticals. RESULTS: The average market-weighted price fell rapidly after generic entry. As a result, the brand price in the year prior to generic market entry was 39% (95% confidence interval [CI], 37%-43%) higher than the LAC per 30-day supply or package. When accounting for medical cost offsets, the brand price in the year prior to generic market entry was 75% (95% CI, 69%-79%) greater than the LAC per 30-day supply or package. The brand price at launch was 11% more than the LAC, and 40% more than the LAC net after adjusting for medical cost offsets. CONCLUSIONS: Branded drug prices might overstate the true long-run cost of pharmaceuticals by 40% to 75%, accounting for generic price reductions and medical cost offsets. To ensure that all drugs providing long-run value end up entering the marketplace, market access and other policy decisions should consider the full range of long-term costs-and not just prices-at a particular point in time.