Trends, Entrants, and Developments (TEDs) Impacting Access: Practices Payers Are Leveraging to Bend the Cost Curve

Good day to you. I am Elizabeth Oyekan, PharmD, FCSHP, CPHQ, Vice President – Access Experience Team, and editor of All Access Newsletter. Due to the significant financial losses by health systems over the last 18 months, and now health plans experiencing adverse impacts to their bottom line as patients come back in for care, these entities are looking for strategies to make up for these losses now and in the future.
In this edition of the All Access Newsletter, we have asked our key expert ex-payers to provide insights into evolving practices payers are leveraging to bend the cost curve.

  • Cynthia Miller, MD, MPH, FACP and Reta Mourad, PharmD discuss the importance of biosimilars in supporting the sustainability of the healthcare system by reducing costs of biological therapies through increased competition while maintaining the quality of care
  • Jennifer Williams, PharmD, BCOP reviews the top reasons payers are adopting clinical pathways and guidelines in the oncology space and the tumor types being targeted, as well as future possibilities payers are exploring in non-oncology specialties to further leverage pathways and guidelines
  • Todd Edgar, PharmD, MS takes us into the world of value-based contracting with new perspectives on how these contracts should be viewed, learnings from past years, and opportunities to make them a win-win for stakeholders
  • Kellie Rademacher, PharmD explores the complex world of biomarker testing including the several testing options available, the expansion of biomarkers, and the resulting challenges for various stakeholders. Kellie highlights possible policy recommendations to help payers and providers address existing challenges and support stakeholder efforts in their pursuit of precision medicine
  • Ryan Cox, RPh, MBA takes us into the world of accumulators and maximizers being used by pharmacy benefit managers (PBMs) and health plans as a result of a continued pressure between plan benefit design, the expansion of manufacturer copay programs, and the growth of drug spending. Ryan discusses what they are, how they work, and their impact on various stakeholders

We believe you will find these current and evolving payer practices to bend the cost curve in healthcare and their impact on access insightful as you navigate the payer landscape. As always, please feel free to drop me a note and let me know if you have a topic suggestion for the payer team to address, and we’ll do our best to cover it in a future edition.

Best regards,

Elizabeth Oyekan
PharmD, FCSHP, CPHQ
Vice President,
Access Experience Team
EMAIL ELIZABETH

All Access is a bimonthly newsletter that features key insights from our team of former payers, intended specifically for market access leaders. It is published by PRECISIONvalue.

Guest Editor
Elizabeth Oyekan

Executive Editor
Louis Landon

Contributors
Andrew Cournoyer
Ryan Cox
Dan Danielson
Todd Edgar
Dominic Galante
Ami Gopalan
Maureen Hennessey
Joe Honcz
Louis Landon
Erin Lopata
Reta Mourad
Kellie Rademacher
Charline Shan

Potential Expansion of CMS’s Site-neutrality Payment Policy and Its Impact

Kris discusses CMS’s new site-neutrality payment policy, which is a major focus for AHIP. While this may be a win for payers, there are considerable risks for hospital systems, and it may have long term impacts on consolidation trends. Impacts on specialty pharmacy and site of care strategies will change how pharmaceutical companies need to convey their value story.

Transitions of Care/Home Health: New Models in Value-Based Care

Sejal describes novel approaches to the long-standing problem of health care system fragmentation and transitions of care. New partnerships and disruptors like CVS and Signify Health, Good Rx, and Amazon are attempting to solve for fragmentation as it can lead to poor medication adherence and outcomes. Pharmaceutical companies can also be a leader in this space. Sejal provides recommendations on how manufacturers can support payers and improve the transition planning process.

Care Delivery Changes and Challenges after the Public Health Emergency

As we move into this post-pandemic phase, it is important to consider how the end of the PHE will impact care delivery and patient care now that certain provisions that allowed for expanded, easier access to care may or may not remain in place. Many hospitals, providers, and caregivers continue to deal with the challenges of workforce shortages and financial pressures, cost increases for medications and equipment, supply chain issues, and sicker patients. 

Shortages All Around: The Implications of Staff Shortages and Rural Hospital Closures on Access to Care

Staffing shortages are not new. For years, the industry has been predicting a shortage of physicians and nurses, particularly in rural areas, and there have been calls to expand scope of practice for nurse practitioners, physician assistants, and pharmacists as a result. Enter COVID-19, and staffing shortages accelerated. Physicians, nurses, and other care providers began exiting the job market because of insufficient resources and burnout.

Beyond the PHE: Forging a More Resilient Future

Three years into the pandemic, a recent Lancet editorial observed, “The acute months of the COVID-19 pandemic motivated an unprecedented response from governments, international organisations, pharmaceutical companies, and civil society.” As we transition to a different phase of this pandemic, the need for multistakeholder collaboration continues, to build resilience and prevent or mitigate future pandemics.

The Growing Emergence of Biosimilars

After a slow start since the first US biosimilar came to market in 2015, there has been a significant increase in approvals and launches. To date, 41 have been approved in the US, with over 90 biosimilars in development. Additionally, in the upcoming months, several biosimilar launches are anticipated to meaningfully impact formularies and pharmacy benefit specialty drug spend.

Patient Affordability After the Inflation Reduction Act: Potential Impacts

The Inflation Reduction Act of 2022 contains a number of health care provisions, including those that will cut Medicare drug spending by an estimated $287 billion over 10 years, according to the congressional budget office. Some of the most widely discussed changes ushered in by the IRA are several near-term changes to the Medicare Part D benefit. These changes are some of the most significant changes in Medicare regulation since the Medicare Modernization Act of 2003.

Inflation Reduction Act: Squeezing of the Rebate and the Wholesale Acquisition Cost Balloon

When you squeeze a sealed balloon on one end, the air doesn’t simply go away; rather, it just finds another part of the balloon to expand. In other words, the air must go somewhere. The Inflation Reduction Act will create a similar dynamic with drug costs for Medicare payers and drug manufacturers.

The Evolution of Payer Access: Now and Then

The $740 billion Inflation Reduction Act, signed by President Biden on August 16, 2022, will have significant implications for pharma, payers, and seniors.The bill implements several significant changes like beginning in 2026, US Department of Health and Human Services will be negotiating directly with pharmaceutical companies for the 10 most expensive Medicare drugs; number increasing to 20 new Part D and B drugs in 2029.

Price Controls and Competition

The Inflation Reduction Act of 2022, which was signed into law by President Biden on August 16, 2022, represents one of the most significant pieces of healthcare legislation passed since the Patient Protection and Affordable Care Act. The law introduces a number of sweeping changes with impact to Medicare Part D benefit design and price control mechanisms for drugs on the Medicare benefit. While these legislative changes will have ramifications across the healthcare ecosystem, they are likely to have a significant impact on manufacturers. 

The new Equity Measures in HEDIS 2022

NCQA’s Healthcare Effectiveness Data and Information Set (HEDIS), beginning with the Measurement Year 2022 and ramping up through MY2024, will begin stratifying selected performance measures by race and ethnicity. The idea is that through HEDIS reporting, health plans will be able to identify and address inequities in healthcare and be held accountable for taking these actions.

FDA Under New Leadership: Future Direction

In February 2022, Robert M. Califf was confirmed as the FDA Commissioner for the second time. A seasoned physician and leader who is late in his career, one can expect that his term will be impactful and influential. Advancements in medicine have required a faster approval process from the FDA while at the same time taxing payers financially and demanding robust evidence from manufacturers. 

Medicare Advantage Outpaces Traditional Fee-for-Service (FFS) Enrollment: Implications

On June 15, 2022, the Supreme Court of the United States (SCOTUS) ruled in favor of hospitals over Medicare regarding a 340B reimbursement policy instituted in 2018 and unanimously decided that the almost 30% in cuts to Medicare outpatient drug payments for hospitals participating in the 340B drug pricing program was unlawful.

The Next Steps in the Oncology Care Model (OCM) – Potential Implications and Opportunities

The OCM was a 5-year voluntary advanced payment model that the Centers for Medicare and Medicaid Services (CMS) developed through the Innovation Center (CMMI) beginning July 1, 2016. CMS changes to advanced payment models due to the COVID-19 Public Health Emergency turned it into a 6-year model, which ended June 30, 2022.

Climate, Taxes, and Price Controls – What’s In the Inflation Reduction Act

President Biden signed the Inflation Reduction Act (IRA) into law on August 16th. The law includes new spending on climate initiatives, new taxes and enforcement, and drug pricing controls include significant changes to the Medicare Part D benefit. On the surface, measures to address drug pricing has had broad bipartisan support; however, the implications from this law may have unintended consequences to the Part D beneficiaries, payers, as well as to drug development and innovation for years.

Ramping Up SDOH Quality Measures within Value-Based Reimbursement Roadmaps

The Centers for Medicare & Medicaid Services (CMS) recognize that health care spending rises as a percent of gross domestic product (GDP) yearly while also underperforming on quality and equity. In this article we will review current and emerging initiatives including new and proposed SDOH quality measures and activities linked to plan and provider payments and incentives, discuss barriers to success, and propose win-win solutions for pharmaceutical companies to advance these initiatives.