Top ways to tap value from specialty drugs for chronic care

The next stage of chronic care management and value-based insurance design for the continuing onslaught of high-priced specialty drugs, including PCSK9 inhibitors.

DunhamIn the midst of the shift from fee-for-service to value based healthcare, pharmaceutical manufacturers continue churning out high-priced therapies. They may be justified to do so as long as the outcomes of the medication therapies outweigh the costs. We define “value” as healthcare outcomes divided by costs. It is easy to understand the value of a $94,500 course of Harvoni to cure hepatitis C compared to a $577,000 liver transplant.

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Newly approved therapies such as the PCSK9 inhibitors with their $1,000-per-month-for-life pricetags cause the value equation to become more complicated for chronic care management. Aon Hewitt recently reported that it expects specialty drug costs to rise 23% next year largely driven by oncology and cholesterol therapies (PCSK9 inhibitors).

As the industry grapples with the next stage of value-based insurance design and chronic care management, payers should consider the following three items in their specialty therapy approval process.

1. Minimum levels of patient engagement required to improve adherence levels.

Sending a patient out of the door with a prescription expecting them to self manage and be adherent to their therapy has proven ineffective. This practice is a primary cause of abysmally low medication adherence rates and $105 billion in wasted annual U.S. healthcare spending. During the JP Morgan Healthcare Conference earlier this year, one pharmaceutical manufacturer told my colleague that adherence to oral oncological therapies is 40%. In other words, 60% of patients dying from cancer are non-adherent to their treatments.

Medication possession rate (MPR) is one commonly accepted metric on adherence, but it only tells part of the story. The minimum required next step is: “You filled your prescription. Now let’s make sure you take your meds.”

Chronically ill patients, especially the sickest of the sick, need at least one dedicated care team member to provide frequent and sustained medication support and adherence counseling, in order for their multiple medications to work effectively and realize their full value.

It is not easy, but in real-world scenarios, it has proven effective in moving both components of the value equation in the right direction. In a cohort of HIV patients on highly active antiretroviral therapy (HAART), consistent patient outreach to ensure adherence, along with customized prescription packaging improved adherence by 28%. The result of which increased the number of patients whose viral loads are undetectable from 28% to 66% and whose overall healthcare costs decreased by $3,000 per patient per year.

Who provides this intensive outreach? Clinical pharmacists supported by patient care coordinators are perfectly positioned to accomplishing these tasks successfully.


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2. Take a longer-term view of the patient.

What does it mean to prevent a heart attack for a patient on $1,000-per-month PCSK9 inhibitors? According to the National Bureau of Economic Research, the average cost to traditional health insurers for the first 90 days following a heart attack is $38,501. The National Business Group on Health estimated the average total cost of a severe heart attack is about $1 million; $760,000 for a less severe heart attack.

A patient with cardiovascular disease or hypercholesterolemia placed on PCSK9 inhibitors would need to live on the medication for more than 80 years before the cost of the medication approached the cost of a severe heart attack.

Yet in this post Affordable Care Act era of high-cost deductibles, patients are less likely to fill prescriptions putting them at greater risk of becoming acute. Another study by the National Bureau of Economic Research published earlier this year revealed that employees in high-deductible health plans that did not exempt prescription drug costs reduced overall pharmaceutical utilization for medications used to treat hypertension, high cholesterol and diabetes.

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While this is a logical response from patients with high deductible plans and drug co-pays, it runs contrary to the intentions of value based care where value equals outcomes divided by costs. Failure to access (acquire) and adhere to medication regimens for chronically ill patients frequently leads to deterioration of their health and costlier instances of care causing outcomes to worsen and overall costs to increase.

The entire point of medication therapy management (MTM) and other effective preventative care is to treat the patient before they become acute.

3. Pharmaceutical manufacturer engagement and risk-sharing.

The day is coming when pharmaceutical manufacturers are going to be required to go “at risk” with new high-cost therapies, essentially accepting lower prices, or in some cases no payment, if the medication does not work. Peter Sullivan reported in The Hill that Senator Bernie Sanders is introducing legislation that “would allow the Medicare prescription drug program to negotiate prices with drug companies, which is currently banned under a 2003 law.”

Personalized medication management programs remove barriers to medication adherence through ongoing support from pharmacists and patient care coordinators. This care allows for the provision of controlled, trial-like conditions in the home, thereby ensuring patients enjoy the maximum level of medication efficacy and improved health outcomes.

Are you meeting regularly with your largest-volume specialty medication manufacturers? Are those manufacturers including specialty pharmacies and MTM service providers proven to improve adherence rates in their limited distribution networks for high cost specialty therapies? Is your managed care organization engaging in studies to determine the impact of MTM on the value of specialty drugs for chronically ill patients?

Doing so will make your path to value-based insurance design and care for the most difficult to treat, chronically ill patients, much smoother.


Patrick Dunham is cofounder and CEO for Curant Health. Curant Health treats patients nationwide through its medication management protocols.