SummaryIn the first episode, Sam Ferguson and Biruk Bekele, consultants in Avalere’s Market Access practice, along with Milena Sullivan, a principal in Avalere’s Policy practice, will discuss how stakeholders are defining value in oncology.
Sam: Hello and welcome to Avalere’s first episode in our Start Your Day with Avalere podcast series focused on value in oncology. My name is Sam Ferguson, and I am a consultant in the Market Access practice here at Avalere. I am joined today by my colleagues, Milena Sullivan, a principal in our Policy practice and Biruk Bekele, a consultant also in Avalere’s Market Access practice. In today’s episode, we will set the stage for how stakeholders are defining value in oncology. Milena and Biruk are both thought leaders in this space and have been leading Avalere’s work in value and oncology.
To start, over the last 3 years, cancer treatment has advanced toward more sophisticated treatment options. Many patients now have access to advanced diagnostic and targeted regiments. Some patients with cancer may even be appropriate candidates for an innovative cell or gene therapy. In parallel to these advancements, the role of the payers has restructured as stakeholders have grappled with how to best manage and pay for these new therapies.
Biruk, let’s start with you. Could you speak to some of the ways in which oncology management has evolved in response to the emergence of these new therapies?
Biruk: Yes, definitely, Sam. It is great to be here with you and Milena today. There is a lot of exciting innovation in this space, and that puts a lot of pressure on payers to manage the overall spend. In oncology relative to other therapeutic areas, we see that payers face a number of challenges in managing these costs.
For drugs, it may be hard to choose a preferred brand and take brands off the formulary, given the many subpopulations of cancer patients. We are also seeing that payers may be limited in their ability to use cost sharing to steer patients from 1 therapy to another. Often, we see that oncology treatments are going to be covered to their US Food and Drug Administration label, with less added payer requirements relative to other therapeutic areas.
From this we are seeing providers play a greater role in serving as the access and decision makers. One of the biggest trends here is shifting risk to providers. The Oncology Care Model (OCM) has been a big catalyst and represents ~25% of cancer care in Medicare fee-for-service (FFS). The model started in 2016, and we have seen practices change their approach to cancer care management because they are now accountable for the quality and cost of care. There has been increased care coordination, adherence to evidence-based guidelines, and greater overall awareness of the total cost of care. Within this model, we are also seeing practices enrolled in downside risk, where they may be accountable to pay back recoupment payments if the total cost of care for their patients after a 6 month period exceeds a certain target that was determined in the model.
We know that the OCM represents roughly 25% of cancer care in Medicare FFS, but we are also seeing similar models popping up in the commercial market. Whether it is a large national plan like Aetna or Humana or Anthem Blue Cross Blue Shield plans in South Carolina or Oklahoma, as providers have more skin in the game they will be more conscious of their treatment approaches and could help to support payers in managing these costs. This is not to say that payers are not already leveraging their own management approaches with trends like vertical integration between payers and pharmacy benefit managers, where there is greater sophistication in tracking utilization of products and outcomes. This could mean that payers could steer patients toward their specialty pharmacy networks or provide greater high-touch services to support care management.
Lastly, the use of clinical pathways to steer providers to leverage evidence-based resources. Payers have the opportunity to implement their own treatment preferences in a pathway and incent providers to these treatments.
Sam: Thank you, Biruk. Milena, I know you have been following this as well, particularly related to recent coverage shifts. What are some of your thoughts on this topic?
Milena: Thank you, Sam. Glad to be here with you today. Biruk mentioned a number of ways in which payers and providers are focused on managing oncology costs. But we should not forget that patients and policy makers are also grappling with the growing cost of oncology care and affordability of those respective medications. We know that patient affordability for cancer therapy and cancer care in general have been top of the mind for some time now. However, in a post-COVID-19 pandemic environment, many of those issues will probably become more of a concern with some of the coverage shifts that you alluded to.
Prior to COVID-19, we had seen estimates that average monthly out-of-pocket (OOP) costs for cancer therapies for patients were as much as 60%–70% of the American average monthly income. Now, we will potentially see a shift from generous employment coverage to less than generous benefits or even uninsurance due to unemployment in the commercial market. Patients are trying to determine how to afford their therapies while drained state and federal budgets are seeing increased pressures to have stricter requirements in place. Along those lines, I think we should remember that before COVID-19 dominated the healthcare debate, there were important proposals moving through congress to cap OOP cost for beneficiaries, including in Medicare Part D. This is something many stakeholders in the industry and patient side were supportive of, and my hope is that once Congress resumes we will see movement and resurfacing of that proposal.
Sam: Thank you, Milena. In this discussion around affordability and oncology management, both of you mention ways decision makers are increasingly weighing financial considerations alongside traditional clinical efficacy in this movement toward value. What are some of the tools that stakeholders are using to parse through treatment options and identify high-value therapies? Milena, let’s start with you.
Milena: Sure. At Avalere, we look at how value is assessed in other developed economies when it comes to cancer care. We have always found that access to oncology therapies is a lot more generous in the US because of the structural and cultural practices of the US healthcare system. This varies from the single payer systems in Europe. However, the cost pressures and shift to value-based care have provided a catalyst for more interest value assessment in the US. So now, we have players from the American Society of Clinical Oncology, the National Comprehensive Cancer Network (NCCN), and the Institute for Clinical and Economic Review (ICER) trying to determine a metric to compare the evidence and cost effectiveness of these therapies in a way that drive us toward value. We are still seeing challenges, because the US healthcare system is so fragmented. The concept of value is not uniform across all the stakeholders, and the patient voice—which is critical to outcomes—has not always been incorporated in a meaningful way in existing frameworks. ICER has asserted itself as a much more vocal body in the drug pricing debate, but to date our analysis shows that it has not found a direct impact on coverage and payment decisions in the US. Moving forward, it is important that these value frameworks move us down a path where patient access does not suffer as a result.
Sam: Thank you, Milena. This is an important conversation that we continue to monitor going forward. Biruk, what are some of the tools you are seeing as stakeholders are similarly responding to cost pressures?
Biruk: Yes, absolutely. As I mentioned earlier, the use of pathways has been a growing tool to make value-based treatment decisions. These pathways are aiming to streamline the abundance of new research that is consistently coming out and allowing providers and other stakeholders to weigh different options based on the efficacy, safety, and cost of different treatments. A lot of these pathways use the NCCN Compendium as a backbone, but there are so many pathways out there; they could be payer driven, developed by a third-party organization, or developed internally by provider groups themselves.
We are seeing the technology behind these pathways and their implementation may be as important as the treatment selection themselves. It is important that these pathways are aligned with physician’s electronic medical records systems and integrate with practice workflow and inventory management. It is also important that these pathways factor the latest research to provide insights to physicians of clinical trial options as soon as possible. I would say Dana Farber’s latest collaboration with Philips, a technology company, is a great example of a partnership pushing this advancement.
Another opportunity that providers may consider are shared decision-making tools to empower the patient to have a greater voice in their care. These tools could help patients understand expectations, establish personal goals, understand the financial burden of their care, and better engage with their doctors and care team. Given the pandemic and increased time away from their physicians, patients could use more customized resources to better manage their disease.
Sam: Thank you, Biruk. The last thing I would like to discuss is the phrase “volume to value,” which has become mainstream in healthcare as new value-based programs are introduced into the commercial and public healthcare sectors. Biruk, you mentioned the OCM, which is a perfect example of this. What is likely to change over the next 3–5 years versus what is to remain constant? Biruk, could you speak to some of the ways you expect our healthcare system to evolve through this new paradigm? And where do you expect today’s world to remain relatively similar?
Biruk: Yes, absolutely. I think we will see similar trends. When I spoke earlier about greater risk for providers as you advance along this continuum, we could see greater use of capitated payments. For example, the recently proposed Oncology Care First (OCF) model, where the Centers for Medicare and Medicaid Innovation Center is looking to bundle evaluation management and drug administration services into 1 monthly prospective payment. We will likely see greater adoption across the board.
I think technology is also a major piece—digital health tools—to better track and manage patients. The opportunity for remote monitoring and other trends could be catalyzed by the COVID-19 pandemic.
There is also big promise for advanced technologies like machine learning and artificial intelligence tools to help stakeholders leverage available large data resources to identify which patient groups could be at greater risk for developing further complications or which may potentially incur greater healthcare system costs, where interventions could be provided earlier. This requires the collection of quality data and the efforts we are seeing in value-based programs like the OCM in requiring the establishment of a patient registry.
Finally, I would say that greater involvement in third party players—whether it is group purchasing organizations (GPOs), specialty pharmacies, or technology companies—in this rapidly evolving space is key for patients, providers and payers to appropriately streamline this system. Specialty pharmacy and GPOs could help catalyze the transition to value-based care by leveraging their data analytic capabilities, monitoring adherence, or supporting risk-based contracts with drug manufacturers. These are exciting changes to look out for.
Sam: Thank you, Biruk. Milena, you are also closely monitoring this space. What are you watching for in the next few years?
Milena: To go back to the COVID-19 pandemic, 1 of my biggest concerns is the short- and long-term impacts to oncology that we will observe in the next few years. As Biruk mentioned, we are at a critical time where we are shifting from the OCM to the OCF. However, we saw a period of 2–3 months where oncology care suffered. The ability of oncologist to manage their patients was severely disrupted by COVID-19. There are many cancer patients who were not able to get the care, surgeries, radiation, or critical therapies on time. So, we are watching to see how COVID-19 impacts not only the performance in the OCM but also the prediction models for the remaining performance periods, in addition to the OCF. For the bigger picture, we know that many patients were also foregoing preventive care, so it is reasonable to suspect that cancer diagnosis and cancer screenings were not done at their usual rate.
Avalere will be levering our data to analyze if patients re-entering the healthcare system are showing a more advanced disease state or greater costs and worse outcomes than what we may have seen prior to the COVID-19 crisis. All of this affects the quality of care in the US, but specifically the shift to value and the ability for providers to have more control in management of the cancer disease. We are excited at Avalere to have access to data that allows us to take a deeper look at the last 2–3 months and particularly in utilization in certain specialties. We will be releasing an analysis focused on oncology to determine what happened over the past 2–3 months, help stakeholders plan for the future, and evaluate what a potential surge in the healthcare system may look like when previously untreated patients or those who have seen delays in care re-enter the healthcare system requiring a deeper level of management than expected.
Sam: Thank you, Milena. I look forward to the insights that will be coming out. Thank you both for joining us today. Your insights have been extremely valuable to our listeners.
Thank you for tuning into Avalere Health Essential Voice. Please stay tuned for more episodes in our Start Your Day with Avalere series. If you would like to learn more, please visit us at www.avalere.com.
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