Value-Based Care and the Future of Specialty

The health care world is largely moving towards a focus on value, rather than paying a pre-specified cost for prescription drugs that may or may not successfully treat a specific patient. This shift has important implications for manufacturers, providers, and patients.

Many manufacturers and payers have expressed interest in value-based care, with some implementing innovative programs. However, much work is still needed to standardize data to ensure the right outcomes are being measured.

In part 2 of a 3-part interview with Specialty Pharmacy Times, Durral Gilbert, president, supply chain services at Premier Inc, and Greg Isaak, president of Commcare Specialty Pharmacy, discussed the importance of value-based care for specialty pharmacy.

Click here to read part 1 of this 3-part interview.

SPT: Why is improving performance crucial to the health care landscape?

Gilbert: When we say performance, what we’re really talking about is quality outcomes. Premier has proven, through our data working in collaboration with our health systems, that high-quality care does not mean more expensive care. It actually means better and more cost-effective care.

The issue with performance, though, is that today’s measures can define it too narrowly. Take, for instance, length of stay. We may measure length of stay as a quality indicator because people that receive better treatment tend to be mobile and functioning sooner. But you can’t be myopic and focus on length of stay to the detriment of other quality indicators. So, for instance, you may have a really low length of stay, but if you’re discharging patients before they are ready to go home, that could come back to haunt you in the form of high readmissions. That’s where performance becomes a lot broader.

As we look at population health, it forces you to look at performance in a very different way. With specialty, a PBM may have a formulary that’s predicated on cost. But if that formulary results in patients going to the doctor more, that’s not a cost savings, that’s a cost shift from the pharmacy to the medical benefit. Performance today is bigger than it was 5 or 10 years ago, because we really are trying to manage a population differently.

SPT: How can value-based care transform the specialty industry?

Gilbert: Value-based care is all about shifting the incentives from paying exclusively based on volume, and instead paying for value delivered. I think it makes physicians and care providers think holistically about the patient. Specialty is particularly right for that trend given the high-cost nature of the therapies. When you have a disease state that has 5 different drugs on the market, how do we know which one is truly going to have a better outcome?

To give an example, some infused or injectable drugs now have oral formulations. The oral can be priced at a premium because there is an assumption the patient will take it more reliably because it’s easier, more convenient. But is the oral therapy really leading to a better outcome? Value-based care is all about rewarding the best outcome, which may or may not be the higher priced choice.

Isaak: To go where I think health care is moving, you may have an infused, injectable, or an oral product that will all be priced differently. Each company is going to tell you their product is as efficacious or superior. However, are we just managing symptoms or are we improving quality of life? Or in some cases, are we curing a disease? Some of the measurements need to go beyond the cost per prescription. Is this patient able to go to work 5 days per week instead of 4? How do we ensure an employer is not incurring a cost because they may need to bring on temporary labor for 2 weeks? How do those outcomes affect everyone’s costs? We had a webinar with a physician who treats multiple sclerosis, and he started the conversation by saying, “20 years ago, I could maybe make you feel the same way you feel today. Now, I can treat you and you will feel better than you did today.” That’s a big advancement. That patient can go to work and participate in their community, whereas before they couldn’t.

Gilbert: When we think of cost, it’s all too common to just look at the sticker price. You don’t think of the societal costs, and Greg just gave a great example of one. When an outcome is not optimized, there are costs to the caregivers, there are costs for that patient and there are costs to the employer.

SPT: What is needed to implement value-based care in specialty pharmacy? How can collaboration facilitate that?

Gilbert: One of the most critical things is real-world data, experiential evidence, historical evidence and longitudinal data. It’s not just data from when they were hospitalized, discharged and managed in the 30-day post-discharge program - it’s a much longer time horizon. When we can see the long-term impact and have data to back it up, we really know we’re moving the needle. It’s not too different than parenting. The journey is a lot longer than the moment you’re in.

Isaak: The longitudinal data is critical because we can all do our jobs to a 98% effective rate, but still fail a patient because we didn’t get them all the way through their course of therapy, or all the way through to improved quality of life. In these cases, we’ve spent tens of thousands of dollars on a result we didn’t want. I think that’s the heart of value-based care. It’s making sure that what we invest in really delivers the outcomes we want.

Check back on Monday for part 3 of this 3-part interview.