Avalere Health
An Inovalon Company
Insights

Jul 26, 2016

Most Health Plans Do Not Use Existing Value Frameworks to Make Coverage Decisions

The plans are waiting to see how frameworks will evolve and if physicians embrace them before relying on them to decide which prescription drugs to cover.

A new report from Avalere indicates health plans have yet to take steps to use publically available value frameworks when making decisions about which prescription drugs to cover and how much to pay for them. Value frameworks are used to assess the value of prescription drugs and other treatments based on the clinical benefits, side effects and improvement in patients’ quality of life, as well as the product costs.

Value frameworks are a relatively new concept. In mid-2015, four prominent organizations—American Society of Clinical Oncology (ASCO), Institute for Clinical and Economic Review (ICER), Memorial Sloan Kettering, and National Comprehensive Cancer Network (NCCN)—launched value framework initiatives intended to help stakeholders assess the value of drugs. 

In a series of interviews with representatives from health plans conducted by Avalere, all plans  said they were aware of the four value frameworks launched in 2015 and expressed that they help to advance the conversation about the value of prescription drugs. However, none of the plans actively use the value frameworks, which they say are early in their development. The plans would like to see the provider community embrace these frameworks before formally adopting them in their decision-making processes. As such, most payers do not think it is likely they will use the frameworks to inform their coverage decisions one year from now.

“Having a transparent methodology and consideration of total treatment costs rather than just drug costs were the two most important features that health plans sought in a value framework,” said Sung Hee Choe, vice president at Avalere. “As these frameworks evolve, those will be important features to encourage broader use.”

The analysis is based on a survey of 11 health plans, including 3 large, national plans as well as small and mid-sized regional plans. The plans sell products across all markets—commercial, Medicare, Medicaid, and exchanges. Individuals interviewed included medical and pharmacy directors. The survey was conducted in June and July of 2016. 

“Integrating broader perspectives of value—especially the patient’s view—may help value frameworks garner greater acceptance,” said Josh Seidman, senior vice president of Avalere’s Center for Payment and Delivery Innovation. “While current frameworks lay the ground work for  the continued push toward value, there’s still room for improvement.” 

This past May, ASCO released an update to its value framework. Recently, ICER released a solicitation for suggestions on how to improve its framework and will host a webinar this Friday, July 29 in which it will provide a detailed explanation of the current version. 

Methodology

Over three weeks in June and July, we interviewed a sample of payers to collect their general perceptions on the utility of ASCO’s Value Framework, ICER’s Emerging Therapy Assessment and Pricing Program, MSK’s DrugAbacus, and NCCN’s Evidence Blocks in coverage decision making. We interviewed a convenience sample of 11 payers that participate in commercial and government markets using a structured discussion template. The interviewees were primarily Medical and Pharmacy Directors. All but one reported being a member of the organization’s P&T Committee. This report follows up on findings released in October 2015, for which nine payers were interviewed (six of the previous payers are included again).

 

Back to Results
« Back to Mobile Site