What is driving the use of data and analytics in the healthcare space?

Why are data so valuable in healthcare? Payers have access to large data sets, capturing everything from what happens at the point of service, patient demographics for those who utilize their benefits, reimbursement information, and metrics to support how members use their pharmacy and medical benefits. Copious amounts of data can be daunting and, if misinterpreted, lead to ineffective strategies. As payers have become more sophisticated, so has their ability to understand the value data have on their business models, in turn, building out the data and analytic arms of their organizations.

Trends in the use of data and analytics to impact drug access

Data are extremely versatile and have been used to monitor utilization, dig deeper into trend drivers, benchmark populations, create benefit designs, measure outcomes, develop financial models, and evaluate opportunities. Use of data has also given payers a better understanding of consumer behavior and how to differentiate themselves in an ever-increasing competitive market. Data aggregation becomes a key component and the foundation, driving the engine forward.

Examples of data/analytics being used to impact access to therapies, formulary decisions, reducing variation. Entrants in this space – Flatiron, COTA, etc

Pharmacy benefit managers are redefining themselves, moving from a “middle-man” mentality to a true healthcare partner. Access decisions are not just based on market share and net cost. CVS Health is using the Institute for Clinical and Economic Review to manage “me too” drugs. If those drugs don’t meet the $100,000 per quality-adjusted life year benchmark, they can be excluded from coverage. While adoption has been slow and faced criticism from patient advocacy groups, it’s an example of how data and analytics can be used and, in this case, from an independent third party, help to maintain transparency into payer coverage decisions. Immunology is a complex and growing market with many drugs used to treat multiple conditions, such as rheumatoid arthritis, ankylosing spondylitis, psoriatic arthritis, plaque psoriasis, Crohn’s disease, and ulcerative colitis. Optum wanted to understand the landscape better and analyzed its electronic health record data to identify which brands prescribers use when initiating therapy, the degree of switching, and the clinical profile of those patients to define metrics helping in their evaluation.

Data and analytic capabilities are also opening up opportunities for organizations like Flatiron and COTA to provide a data-driven approach to leverage the use of real-world data to support oncology clinical trials. Flatiron has built a platform to advance oncology research by sharing provider workflow information and de-identified patient data with research institutions and pharmaceutical companies. Their analytical tool allows them to aggregate data from multiple sources (ie, research, lab, payer) to generate real-world evidence, supporting clinical trial and drug development. COTA is using its analytical expertise to help with value-based programs like medical home models, bundled and episode payments, and shared-risk arrangements.

Potential impact on payers and pharma including challenges to address

Data synthesis and the ability to evaluate, interpret, and develop programs based on the output it yields, provides many within healthcare the ability to broaden their suites of services in a disciplined and substantiated manner. Payers will continue to use data to determine formulary access strategies, understand how to manage trends, and evaluate the effectiveness of their management programs. However, as they move to a more patient-centric, outcomes-based model, data provide them with sophistication and validation. Pharmaceutical organizations have the ability to use data to build more effective and successful clinical trials and support current brands with real-world evidence. Start-ups are looking to technology to enhance data and analytic capabilities, identifying creative ways to improve healthcare, and give consumers choices in the way their healthcare is managed.