Payers and providers are working together to control treatment costs
Healthcare providers believe that the pharmaceutical industry could play an important role in helping value-based systems such as accountable care organizations (ACOs) deliver better care at lower cost. But pharma companies currently do a poor job of delivering the kind of data needed to accomplish that goal, according to a survey of physicians, conducted by Oliver Wyman, a New York-based management consulting firm.
“Healthcare providers are already feeling pressure to control the cost of healthcare, and they believe that pressure will only increase over the next few years,” says Mark Mozeson, a partner at Oliver Wyman who specializes in life sciences, and is co-director of the research. “They believe that pharmaceutical manufacturers could help them succeed in that task by helping them understand how their drug spend helps them keep patients well and out of the hospital-and away from other, more expensive forms of treatment. But they don’t see that happening yet. Indeed most doubt whether pharma even has the ability to provide them with the kind of information they need.”
The 200 respondents currently make at least 25% of their income through value-based care arrangements. Seventy percent say their organization would increase its use of alternative reimbursement models over the next five years. More than half agreed with the statement: “My provider group's ability to manage the cost of treating patients is a major factor for my personal compensation.”
As health plans and provider organizations move toward value-based models, drug spend is usually not the first item on their list,” according to Mozeson . But that doesn’t mean it’s not important.
“Payers and providers need a whole new understanding of the economics of care, including the economics of drug therapy,” he says. “But to get that, they’re going to need to get the pharma companies on board. When we talk to healthcare payers and providers today, we hear a strong concern with cost of care. But pharma companies for the most part either haven’t heard the message or think that it doesn’t apply to them.“
He adds that there’s a long way to go in understanding the economic value of drugs. Payers and providers need to be “firm about getting the data they need.” However, they will also need to partner with pharmaceutical manufacturers to optimize results.