Patients with stage III or IV melanoma who were at high risk of disease recurrence and who received an investigational therapeutic cancer vaccine following complete resection saw a 44% reduced likelihood of recurrence or death vs patients treated with pembrolizumab alone. Data from the phase 2b trial were presented at the 2023 American Association for Cancer Research (AACR) meeting in April and announced by both AACR the vaccine’s developers in news releases.1,2
In the trial’s overall intention-to-treat population, adjuvant treatment with mRNA-4157 and pembrolizumab resulted in an HR of 0.56 (95% CI, 0.309-1.017; one-sided P = .0266) compared with pembrolizumab alone.3
The novel treatment, which combines messenger RNA (mRNA)-4157 individualized neoantigen therapy with the PD-1 inhibitor pembrolizumab, allowed 78.6% (95% CI, 69.0%-85.6) of the patients to achieve recurrence-free survival at 18 months compared with 62.2% (95% CI, 46.9%-74.3%) of those in the pembrolizumab arm. In a statement, AACR said the benefit was seen regardless of tumor mutational burden status, according to results from the trial presented during the meeting.2,3
“[These] results provide further encouragement for the potential of mRNA as an individualized neoantigen therapy to positively impact patients with high-risk resected melanoma,” Kyle Holen, MD, Moderna’s senior vice president and head of development, therapeutics and oncology, said in the companies’ statement.1 “The profound observed reduction in the risk of recurrence-free survival suggests this combination may be a novel means of potentially extending the lives of patients with high-risk melanoma. We look forward to starting the phase 3 melanoma trial soon and expanding testing to lung cancer and beyond.”
“Data from KEYNOTE-942 [NCT03897881] provide evidence for the potential of mRNA-4157 (V940) in combination with Keytruda [pembrolizumab] to improve recurrence-free survival when given to patients with resected high-risk melanoma,” Eliav Barr, MD, senior vice president, head of global clinical development, and chief medical officer, Merck Research Laboratories, said in the companies’ release.1
Barr said the data show the potential benefits of the investigational mRNA neoantigen therapy with pembrolizumab in treating melanoma earlier. Not only does Merck look forward to the phase 3 study in melanoma, he noted, but there is potential for the agent’s use in other early-stage cancers.
This Merck/Moderna collaboration is one of several exploring the use of therapeutic cancer vaccines. Merck’s pembrolizumab is being studied with other vaccine delivery systems, including IMV’s DPX technology in diffuse large B-cell lymphoma and bladder cancer.4
The FDA and the European Medicines Agency have already granted a breakthrough therapy designation for mRNA-4157 in combination with pembrolizumab in the adjuvant setting for patients with high-risk melanoma following complete resection.5
The Community Oncology Alliance (COA) surveyed member practices in early May 2023 about their plans to take part in the Enhancing Oncology Model (EOM), as leaders of the Center for Medicare and Medicaid Innovation (CMMI) worked to answer questions about the alternative payment model (APM) and EOM participation agreements that practices received during April.
Ted Okon, MBA, executive director of COA, discussed plans for the survey during a panel discussion on April 20 at the Quality Cancer Care Alliance (QCCA) annual meeting. At the session, billed as a “crystal ball” discussion on what lies ahead in community oncology, Okon said CMMI was aware of provider questions about EOM requirements, which might keep some practices from participating despite past success in the Oncology Care Model (OCM).
The EOM is a successor to the OCM, an earlier APM Medicare offered from 2016 through 2022. The new model, announced in June 2022, is set to begin July 1, 2023.1
CMMI held 3 webinars between April 21 and May 4 to discuss elements of the EOM agreement. COA’s survey, set to conclude on May 10 as Evidence-Based Oncology (EBO) went to press, would gauge whether enough practices will sign up for the EOM for the model to move forward. In late March, CMMI said in an email to EBO that a minimum number of practices were needed for the EOM to proceed, although it declined to say how many.2
Okon told the QCCA audience that CMMI leaders were “very concerned” about getting enough EOM participants. “The bottom line is, if enough practices don’t do it, then they will have to make some changes,” he said.
Concerns About the EOM
Although the OCM and EOM have many similarities, there are key differences, including smaller monthly payments for required services, a requirement to assume risk from the first day, and a requirement to track information on patients’ health-related social needs. Multiple practice leaders have told EBO that although they remain committed to value-based care, the EOM as proposed requires more work with greater financial risk than the OCM.2 Many would welcome a 6- to 12-month window in the EOM without taking on risk to learn how it operates.
Led by moderator and QCCA President Sibel Blau, MD, medical director at Northwest Medical Specialties of Puyallup, Washington, the panelists discussed these concerns to open the session. Besides Okon, they included Barbara L. McAneny, MD, CEO of New Mexico Cancer Center in Albuquerque; Alti Rahman, MHA, MBA, practice administrator for Oncology Consultants in Houston, Texas; and Lalan Wilfong, MD, a longtime oncologist with Texas Oncology in Dallas, and senior vice president for Payer and Care Transformation at The US Oncology Network.
Wilfong said modeling based on OCM and internal data show that some practices in The US Oncology Network might not fare well under the EOM because of market dynamics, not poor care by the physicians. “Some of it’s just unique characteristics of those practices,” he said.
Rahman said the OCM allowed his practice to build value-based relationships without taking on risk right away. Early on in the OCM, he said, “the initial benchmarking was really going to work against us. But we were OK with that because it was a learning opportunity for us.”
For McAneny, the EOM is a sign of what is to come—which Okon and Blau agreed could be a mandatory at-risk Medicare reimbursement system. “I think [this] is a great weather vane for where the government wants to go,” McAneny said, noting that her practice developed the COME HOME model, a precursor to the OCM, and saved $675 per patient without assuming risk.
“I feel like we…need to do it, because it’s going to be something that’s going to be mandated,” Blau said.
Okon noted that language in the Affordable Care Act gives CMS the power to implement an APM once it has demonstrated that it saves money—which is the chief reason for the cut in monthly payments for mandatory services. But he said for many practices, reluctance to sign the EOM agreement comes down to timing issues: practices did not receive EOM agreements until April, and they cannot get data they need to obtain stop-loss insurance until 2 weeks after they sign up. For many, this is impossible, he said.
Both practices and CMMI are grappling with the impact of the Inflation Reduction Act (IRA), Okon said. As practices evaluate what the IRA will mean for their bottom line, he noted CMMI has had key staff reassigned to implement this major piece of legislation that will allow Medicare to negotiate prices for certain high-cost drugs, including many in oncology.
Future of Medicare Advantage
Medicare Advantage (MA) plans accounted for 46% of Medicare enrollment in 2021, and that share is projected to reach 50% this year.3 The panelists agreed that with more people aged 65 and older signing up for MA plans instead of traditional fee-for-service plans, the question is not whether they are happy about it, but how they will respond.
“Like it or not, they’re making up half the beneficiaries, and it’s going to continue to increase,” Rahman said. “So it’s both a cause for concern, but perhaps an opportunity as well, because they have to think about total cost of care across all sorts of conditions—and all specialties.”
His practice, Oncology Consultants, accepts MA plans when many area hospitals will not, something Rahman says sets the practice apart. Not only does the practice serve patients who would be otherwise be shut out of care, but it forms risk-sharing collaborations with like-minded primary care and chronic care providers who take a public health approach and look at ways to reduce cancer risk upstream.
For Rahman, a key question these days is, what is the practice doing beyond oncology? If primary care providers are viewed only as a source of referrals, “That’s a big red flag for me.”
McAneny agreed that preventing cancer is the right approach, but she remembers too well when payers did not want to fund tobacco cessation for 30-year-old patients, “because when they stopped smoking, they might be on someone else’s dime.”
“So the goal of having an integrated system, where we’re promoting health from cradle to grave, would be ideal,” she said, “but I don’t think it’s Medicare Advantage.”
Accountable care organizations (ACOs) have proved to be a disappointment, McAneny pointed out, because instead of providing true integrated care and data sharing as promised, many have recruited the healthiest seniors, not those with cancer or those receiving dialysis. The attitude is, “We’re going to consolidate the market and we’re going to carve out sick people. And we’re going to maximize the revenue and minimize the expenses.”
Rahman agreed this is happening, which is why physicians need to be in control. Wilfong then explained the financial reality of why ACOs are so attractive to both payers and primary care physicians (PCPs):
“The payers’ profit from Medicare Advantage is double or triple what they make in a commercial setting, because of the ability to take risk and generate that profit. And additionally, what we’ve seen is that primary care physicians are doubling and tripling their salaries by going into the MA plan to take risk. So you’re seeing a lot of consolidation in the B2B space,” with models such as employed physicians and vertical integrated networks.
“We’re seeing a lot of consolidation in the PCP space around Medicare Advantage, because they’re able to increase the revenue. I mean, if you’re a PCP making $100,000 a year, you’re going to want to increase your revenue,” Wilfong continued. “The point is, we have to figure out a way to work with Medicare Advantage.”
He agreed that some bad players are sacrificing care, but not all are. Wilfong said his own parents have MA plans and his father has benefited from regular check-ins with a nurse. Community oncology, he noted, can be a positive force in holding MA plans accountable.
Okon sees this happening already, especially as plans have become integrated with pharmacy benefit managers. Abuses have captured Congress’ attention, he said, and there is bipartisan momentum to rein in bad behavior.
“The underlying problem is the consolidation of the market,” Okon said. “How many of you think that the major problem in health care is that the health insurance companies are not making enough money?... The more consolidated the market is, the more powerful it is, the more they’re going to have more influence in Congress.”
But actions that started in the states are reaching Washington, DC, he said. COA now plans to bring members to Capitol Hill on June 13 to share firsthand accounts of how vertical integration and pharmacy benefit manager/insurer abuses are affecting patients.
“If you have a patient standing up there saying, ‘I didn’t get my drug’ or ‘This copay maximizer cost me [a large] amount of money,’ that makes a difference,” Wilfong said.
What does “service delivery” look like for oncology practices in the coming years? To be sure, offering better cancer care is the centerpiece, but finding new revenue streams as Medicare squeezes reimbursement and making existing care delivery more efficient also matter.
A panel of top practice administrators, moderated by Danielle Geiger, MSN, APRN-NP, AOCNP, of Nebraska Cancer Specialists, explored ways for practices to improve the bottom line at the Quality Cancer Care Alliance (QCCA) spring conference, held April 19 to 21, 2023.
Taking part in the panel were: Jeff Hunnicutt, CEO, Highlands Oncology Group, based in Fayetteville, Arkansas; Beth Page, chief operating officer, Cancer Specialists of North Florida; Mel Davies, chief financial officer, Oregon Oncology Specialists; and Mark Nelson, CEO, Northwest Medical Specialties of Puyallup, Washington, and chief business development officer, QCCA.
“We recognized we couldn’t stay the same,” Davies said, and her practice is among those that have expanded to become a multispecialty practice with rheumatology and infectious disease services. Much of the growth has happened around multispecialty infusion and injection services, and Geiger said oncology practices around the country are finding that this model offers a source of additional revenue.
In cases where the rheumatology provider also joins the practice, Geiger asked whether the physician was previously independent or came from a hospital.
Typically, Davies said, the physicians have come from independent practice. In one case, the physician was ready to retire and needed a way to hand off his practice. “They haven’t really had an exit plan per se, and surviving has been a challenge for them. They were at the size that they needed to do something different.”
Hunnicutt said Highlands has seen similar situations with independent surgeons, who needed to recruit another physician to take over but didn’t know how to make the situation attractive. Folding into a community practice offers a more like-minded setting than a hospital, he said.
Geiger asked who makes the first move. “We call it shoulder tapping,” Davies said. The Oregon practice’s size offers advantages in attracting younger doctors. “They don’t want to be the only one at a practice who does something; they want somebody to learn from and peers and mentoring.”
Chronic Care Management
As the Oncology Care Model (OCM) ended, practices had to find new ways to fund the comprehensive services that patients had come to expect, which had been covered by payments for Monthly Enhanced Oncology Services, or MEOS. Hunnicutt explained how Highlands was able to tap into the Chronic Care Management (CCM) model to replace some revenue previously received through MEOS. And, by making use of electronic patient-reported outcomes (ePROs) to keep patients out of hospital, the practice was able to tap into yet another revenue stream, remote therapeutic management, a new code launched in January. “It’s much [simpler] than CCM; you don’t have to get consent or a lot of these other logistical headaches that go along with chronic care management,” Hunnicutt said.
Although using the new code does not offer “a massive influx of revenue,” he said, it more than covers the cost of ePRO software, which previously had been a barrier for practices seeking to monitor patients in this way. “That code is really helpful to help you make a decision to give better care and offset the potential expense to your practice.”
Hunnicutt touted another benefit of using the codes to pay for ePROs: they helped boost time on treatment, which was best for the patient and for the practice’s bottom line. “You don’t have the discontinuation events where you’re sending them to the [emergency department (ED)] and consequently to the hospital…. That’s a good thing for their care journey and for what we can do to help them recover. So it’s just a win-win all the way around.”
Geiger asked if there are any pitfalls to using the new codes, and Page weighed in.
“I know my doctors out there are not loving it yet, but it’s working pretty well,” she said. “We were able to repurpose 5 nurses back into the clinic.”
She agreed that using ePROs helped keep patients out of hospital and helped the practice meet the terms of its value-based contracts. “We were able to get shared savings out of that, because our patient population just stayed out of the ED—that was really good.”
Geiger noted that keeping patients out of the ED was a major focus of the OCM, so these tools help practices keep up that momentum. Nelson said this can create a juggling act given the staffing shortages that so many practices and institutions are facing. “As much as we love getting that information, we have to deal with that information,” he said.
Page noted that practices must have protocols to get back to patients quickly. Hunnicutt recommended that practices centralize certain triage functions first before taking on ePROs, so staff are already accustomed to backing each other up on the portal. Consolidating these functions can free up staff for other things, such as recruiting. And moving them out of primary medical spaces—or allowing staff who handle ePROs to work remotely—can cut costs.
Geiger and Nelson discussed another realm that practices have taken on, both within the clinic walls and beyond: research.
About 25 independent practices in QCCA and the National Cancer Care Alliance formed Exigent to help trials reach up to 1.8 million patients in the community by offering centralized contracting, billing, and Institutional Review Board services.
“We’re building out the ability to look at the structured data vs the structure of genomics and then do the matching in real time,” Nelson said. “There is no way a practice can do that without a large network, in my mind, not in a financially feasible way. So now we’re beginning to see that financial gain.”
Not only does this generate revenue for practices, Geiger said, it also creates new opportunities and job satisfaction for staff. Hunnicutt said some tasks can be done remotely. “It gives you an option to keep good people. If you have someone on your team [who] is outstanding, and maybe if they have a husband who’s in the military and they’re getting shipped out to a different state, you can explore an option to be able to keep them as a productive part of your team that’s beneficial to you.”
But the bottom line also means staying on top of payers who stop paying on a certain code, and using good data analytics to uncover these things quickly.
Value-based care is constantly evolving, Geiger said. “I don’t [think] any of us really know what it’s going to look like, and obviously neither does CMS,” she said. “But I would think we would like to know how your practice is saving money.”
Nelson said that thanks to a close relationship with a Blue Cross Blue Shield affiliate, Northwest Medical Specialties knows where it stands relative to area hospitals in cost of care. “We were 100% biosimilar adoption, while the hospitals [are] still many times using brand [name drugs]—there’s no consistency,” he said. Northwest saw large, shared savings checks because of the differential in the rest of the market. Research allows the practice to avoid costs if it ties into a phase 1 study vs a salvage therapy line, he said.
“And the biggest development everyone should be aware of is this value-based enterprise concept,” which the Community Oncology Alliance has promoted in the wake of the end of the public health emergency, that allows practices to continue to mail oral drugs to patients. The practice had increased during the pandemic.
Hunnicutt said Highlands had challenges during parts of the OCM due to high numbers of patients with myeloma. However, in general the practice bought into the idea of screening and prevention, and now it is moving toward the idea of being a multispecialty practice.
“Should we be looking at labs? Should we be looking at all of the different things that patients get inside…your practice that you should be able to provide, and, if you can, provide it for the whole patient?” he asked.
“Everything up here and being in QCCA is, we feel, what’s best for the patient, and we can take those best practices and put them in place,” he continued. “I think you have to look at every service you provide for your patients and think, ‘How can I do that myself?’ without ‘I’m taking it outside of my practice.’”
Panelists at the 2023 Asembia Specialty Pharmacy Summit discussed the myriad ways that the drug pricing policies of the Inflation Reduction Act (IRA), such as those concerning inflation rebates and a redesign of Medicare Part D plans, will affect payers and manufacturers.
Payers and drug manufacturers will be taking on more financial liability under the new pricing policies going into effect, according to the panelists. The conference took place in Las Vegas, Nevada, from April 30 to May 4.
Regarding negotiations, Medicare will only be able to negotiate prices for certain medications that must fit specific criteria, and the program will have to take several steps to come to a maximum fair price for beneficiaries. The number of drugs for which Medicare will be able to negotiate prices will increase annually starting in 2026.
CMS will select drugs for negotiation on multiple factors, such as time on market, availability of generic or biosimilar competitors, and whether they meet the agency’s exclusions criteria (orphan drugs, plasma drugs, developed by a small manufacturer). Drugs that qualify for negotiation will then be ranked using Medicare claims data. The first round of chosen drugs is projected to be announced on September 1, 2023.
Kelsey Lang, a principal at Avalere, explained that CMS clarified that it would aggregate spending for drugs that have the same active ingredient, regardless of time on market.
“If you have a product that has multiple formulations, and one…has been on the market for 7 years and the other has not, both…will be merged for purposes of Medicare negotiation. The same is true for a product that has multiple indications. The flip side of this is that they are also aggregating for purposes of making the drug ineligible due to generic or biosimilar competition. So if any one of those products has a generic [or biosimilar] on the market, that will exempt all formulations and indications…from the negotiation process.”
Inflation-based rebates have been in effect for Part B plans since January 2023 and will be expanded for Part D plans in October 2023. Omar Hafez, managing director at Avalere, argued that although the criteria used to determine rebates will differ between Part B and Part D plans, one of the unintended consequences of this action could be that drug manufacturers launch their products at higher prices to make up for what they will pay in rebates.
The Medicare Part D redesign will include a $2000 out-of-pocket cap for beneficiaries beginning in 2025, changes for manufacturer liability, and a shifting of financial liability from the government to Medicare plans.
Lang said that manufacturer liability will be dependent on a company’s portfolio, such as whether they make specialty medicines. Additionally, some plans have tools that can help manage liability, which can affect how flexible they can be with adapting to the new rules.
Hafez argued that although payers and manufacturers will both take on more liability, manufacturers will experience this effect from multiple angles.
“I think that the plan certainly is going to be one of the big stakeholders that will have to recover a lot from this, but the manufacturer is going to have a double whammy. They have higher liability, but now the payer is likely to come after them with higher rebates. And when you think about how the pricing, contracting, and, just generally speaking, access strategies are going to be over time, those are all things that are going to have to be reevaluated,” Hafez said.
The panelists stressed that stakeholders must keep in mind that the IRA could affect the value of biosimilars as well as the pharmacy’s role in new provisions that allow Medicare beneficiaries to spread out of pocket costs throughout the year, saying that CMS will need to define the characteristics of which patients will benefit from these policies.
Although digital tools can be immensely helpful for creating a personalized, convenient interaction between patients and the health care system, they should not be the be-all, end-all method to improve the patient experience, according to a panel discussion at the 2023 Asembia Specialty Pharmacy Summit.
The panelists weighed the pros and cons of using digital communication and monitoring tools within specialty pharmacy spaces to improve the patient experience, arguing that digital tools must be used in tandem with other approaches.
The session, Making Consumerism Work for the Modern-Day Patient, featured a discussion on what health systems should keep in mind when implementing digital tools, as well as how the systems can learn from them to improve their patient engagement strategies. Asembia 2023 took place April 30 to May 4 in Las Vegas, Nevada.
Natalie Bedford, senior vice president at CenterWell Specialty Pharmacy at Humana, began by explaining that a bad experience is the number 1 reason why patients change providers. She recommended that heath care organizations implement multiple communication channels for patients to connect with their providers.
Greg Leighton, vice president of access strategies and patient services at Ardelyx, a small biopharmaceutical company, said that health systems need to have a “toolbox approach” that centers on patient needs and sets the organization up for success.
Although there is a greater trend toward digital communication and monitoring tools across the health care industry, Leighton noted that patient trust needs to extend beyond the health care system and their providers. Patients also need to have faith in the medications they are taking and the companies that develop them.
“When [patients] leave the office and then they interact with, say, a case manager, whether it’s through a tool or through a personal safety message that they get through a feed, it starts to create this repetitiveness, which then leads to trust. And when you build trust, then they trust the brand, and then the brand becomes human. It becomes kind of its own ecosystem [where] they know when this drug is prescribed,…[the health care organization] is there to support them.”
Bedford elaborated, saying that providers also need to have trust in both the medications they are prescribing and their health care organizations. Specialty clinics need to build systems and tools for providers to engage with, access resources, and provide feedback to ensure that they can support their patients sufficiently. Bedford cited her organization’s efforts as an example for building trust with providers.
“In addition to having the human touch, whether it’s through our contact center, our sales team, or our sales operational support representatives, we have worked really hard to build strategies on ways that our providers can engage with us to understand what that referral is every step of the journey, for us to be able to give them that information, or an easier way for them to get information to us to help us more quickly assist that referral. So that’s just another spoke of the wheel to really ensure that the patient is able to get to them.”
Leighton and Bedford also touched on the use of one-click technologies, such as those employed on Amazon, within digital health communication tools, saying that they can be helpful when used appropriately. One-click tools can be great for quick enrollment as well as providing patients with an easier way to monitor their drug adherence and refill schedules.
However, implementing one-click technologies into digital tools may require a blended approach with more traditional communication strategies to ensure that patients are taken care of through every step of their care journey.
Craig D. Pederson, a principal at Insight Health Partners, took the stage on April 28 at the National Association of Managed Care Physicians (NAMCP) Spring Managed Care Forum 2023 to offer a keynote address on the evolving landscape of value-based care and the challenges it creates for providers.
First, he took time to provide context around the current state of value-based care, as well as the term’s origins and varying definitions. At its roots, the intention of value-based care is to restructure health care in a way that increases value for patients, value being defined in various ways.
“You hear boards talk about this at board meetings at health systems. It’s in every article. It’s a triple aim, or quadruple aim, quintuple aim…pretty soon we’ll have the [nonuple] aim,’” Pederson joked. “But what exactly is it, and is 9 better than 3? What’s the benefit and the cost of value-based care versus the fee-for-service structures we were in versus global capitation…and finally, the key question, can we succeed?”
The Triple Aim, a term first coined in the mid-2000s, refers to the goals of better care quality, improved patient experiences, and lower costs.1 The term “value-based care” was introduced in a 2006 book by Michael E. Porter and Elizabeth Olmsted Teisberg titled Redefining Health Care: Creating Value-Based Competition on Results,2 Pederson noted.
In the years since, there have been many iterations of value-based programs sponsored by both government insurers and private companies. Still, the definition of the term varies, and Pederson provided a few published definitions, indicating as such.
One way to look at value-based care is the idea of restructuring health care systems with a main goal of value for patients—with value defined as health outcomes per unit of cost. Another definition asserts that in value-based care agreements, providers are “paid based on patient health outcomes.”
Among other challenges, a main issue that arises in value-based care surrounds attribution, meaning a patient is attributed to a provider and that provider is reimbursed based on the contract. But what is attribution? If a patient sees 2 primary care providers within a year, which provider is paid for their care?
“Here’s the problem: Attribution is determined after the fact. So if I’m a physician in the health system treating a patient, is that or isn’t that my patient? Don’t know. So I have to boil the ocean. I have to build my infrastructure,” Pederson said.
Additionally, there’s the matter that fee-for-service (FFS) schedules are here to stay, Pederson said.
“Even within a global capitation environment, there are fee schedules underneath that,” he said. “So you’re always going to have to be having providers be productive. And some of your providers will continue to stay pure fee-for-service—maybe the orthopedic surgeons and cardiologists, [and] oncology. It’s an underlying reimbursement system and within global capitation models.”
Pederson reiterated the issues with attribution, that it may look good to payers but poses challenges for providers. He noted that assignment—having a person select a primary care provider based on availability—is more clear-cut for contractual purposes than for calculating attribution after the fact. The timing of assignment is also immediate compared with the lag that comes with attribution after care is delivered.
A couple of decades ago, assigning did not work out well for many primary care providers due to issues related to risk adjustment, Pederson said.
“The problem with assignment 20 years ago [was that] we did not have appropriate risk assessment. So the family practice physicians would look much better than the internist,” he explained. “And you would actually have a health plan leadership, if you weren’t performing well as the primary group, telling you, ‘Well, get more family practitioners. You’re just getting a younger patient population—this model isn’t fair to the internist.’”
Nowadays, appropriate risk adjustment can be done, and that is how systems such as accountable care organizations (ACOs) can work, he said.
Another challenge is the potential for improvements in quality but without improvements in total cost of care. In the long term, a model that does not perform well from a financial perspective will leave the bills unpaid.
Pederson cited a case study of a regional health system including 2 hospitals with 800 beds and more than 450 providers that invested in an ACO that participates in downside risk of the Medicare Shared Savings Program (MSSP). Before, during, and after COVID-19, operating losses in the system were vast.
The system hired Insight Health Partners as an interim chief financial officer, and the strategic plan maximized revenue by shifting services and physician specialties to provider based and moving more than 50 cardiovascular providers to provider based. Although there was a loss of about $1 million in value-based care bonuses, there was $3 million of incremental revenue.
“The strategies that increase revenue and improve the bottom line will eat value-based care’s lunch 100% of the time,” Pederson said. “I’ve never seen it go the other way.”
He provided 2 additional case studies, concluding that the return on investment equation for value-based care is missing some components. These include provider time investment, such as lost productivity and FFS revenue; nonprovider time investment such as nursing, leadership, or care coordination; investments made in structural changes such as consulting, administrative time, contracts and/or provider compensation plans; and more.
“Hospital-centric health systems are not effective leaders of value-based care plans. They’re cost centers—the walk doesn’t match the talk,” Pederson said. “It does if they have a 10% margin or better, but the second it gets skinny, or they’re in the red—which again, [if] you read the headlines, a lot are in the red—they will do whatever possible to turn that around, including increase everything against the Triple Aim.”
For those considering value-based contracts, he urges avoidance of large downside risk adoption or investments. Another possible solution is being more vocal about the issues associated with a failing model to increase pressure on key decision makers, Pederson said.
“Stop pretending. Maybe they should be increasing total cost of care. Just do it, and be honest about it and why you have do it. Put the pressure on the policy makers or the payers,” he urged. “We need to talk about this model and we need to get it right.”
Despite the challenges, there are some providers who are more likely to win in value-based care, Pederson said. He lists private equity firms, for-profits, and physician groups, calling large physician groups “the tip of the spear” in this regard.
For traditional nonprofit health systems, though, succeeding will be difficult unless they also include health plans, he said. And competing against new and evolving for-profit, venture capital–backed systems in the managed care environment will almost certainly be a losing battle, he added.
Overall, Pederson’s takeaway is that providers should approach value-based care with caution. Although the theoretical aim of such systems is to deliver patient-centered care and improve outcomes, the significant challenges associated with succeeding under value-based care from a financial perspective are important to consider before diving in.
In the closing general session at the Pharmacy Quality Alliance (PQA) 2023 Annual Meeting, held May 10 to 12 in Nashville, Tennessee, panelists dived deep into the implications of the Inflation Reduction Act (IRA) on medication access and affordability.
To kick off the session, Corey Ford, MHA, director of reimbursement and policy insights at Xcenda Consulting, gave a brief overview of the implementation of the IRA and its 5 core components related to health care: Part D reforms, inflationary caps, Medicare negotiation, biosimilars, and Affordable Care Act (ACA) subsidies.
Starting in 2026, there will be negotiations for drug pricing within Medicare Parts D and B, and a rebate penalty will be imposed on drug prices that outpace the rate of inflation. CMS is set to list the 10 drugs eligible for price negotiations in September 2023, and if manufacturers fail to enter these negotiations, an excise tax will be imposed. Ford said the outcome of these negotiations will be a fair price for the product, which will be the negotiated price of the drug in Part B or D moving forward.
The IRA also includes the extension of ACA subsidies through 2025, which Ford said is vital to maintaining access to health insurance for Americans. There will also be an increase in Medicare Part B reimbursement for biosimilars and a complete redesign of the Medicare Part D benefit. By 2024, a patient will no longer have out-of-pocket (OOP) costs once they reach catastrophic coverage, an expansion in the Low Income Subsidy (LIS) will be established, and the insulin copay tax and $0 OOP costs for Part D vaccines will take effect. By 2025, a true OOP cap of $2000 will be put in place.
Expanding on the LIS, one significant change is the inclusion within the manufacturer liability for the coverage gap discount program. Although this change is expected to be beneficial for patients, there will be a transition period as manufacturers adjust. Additionally, manufacturers with sales below a certain threshold from a Medicare Part D perspective will also have a transition period to the new benefit design. Another notable change is the insulin copay caps set at $35 per fill, which applies to the entire Medicare Part D market.
The IRA is expected to be beneficial for patients, but Ford noted that there are still concerns about affordability for those on a fixed income. Further, there may be additional affordability challenges that patients could face under the new benefit design.
Following this IRA overview, Ford was joined onstage by Gregory Daniel, PhD, MPH, MS, vice president and head of global public policy at Eli Lilly and Company, and Marissa Schlaifer, MS, RPh, vice president of policy at Optum. The panel was led by Ceci Connolly, president and CEO at Alliance of Community Health Plans.
Also joining the panel was George Valentine, a 71-year-old patient living in Texas who retired in 2019 after 40 years of work in information technology. In 2002, Valentine received a diagnosis of chronic lymphocytic leukemia; he also has type 2 diabetes. Valentine takes 20 different pills a day and sees 10 doctors; he said nearly 40% of his fixed income goes toward medical expenses each year.
“When I hear ‘the Inflation Reduction Act is going to lower your drug costs,’ I say ‘That’s a great start,’” Valentine said. “But there’s a much bigger bucket of costs and things that have to be looked at to make a real impact on a patient with a chronic condition.”
Daniel discussed the challenges the industry sees with CMS’ way of interpreting which drugs meet the thresholds for being eligible for price negotiations. Historically in the United States, in the oral medication space, generics flooded the market once a product lost its exclusivity. However, with the advent of biosimilars, competition is increasing in the biologic space as well, changing the revenue perspective.
The IRA further complicates matters because it puts the clock of Medicare price negotiations into this dynamic. Under the IRA, small molecules are eligible for negotiations 9 years post approval, and biologics after 13 years. But CMS has interpreted the eligibility for negotiations to be triggered by the original approval only; if an oncology therapy is studied in a new population beyond its original use or is approved in a new indication, Daniel said, “none of that counts.”
Schlaifer then spoke about the implications of the IRA on access and affordability from a plan perspective. Some benefits include increased affordability for beneficiaries and improved medication adherence, resulting in better health outcomes. However, the IRA also has consequences for the industry, particularly for smaller Medicare Part D plan sponsors. Although the financial liability for this benefit very much decreases for CMS, the amount that the Medicare Part D plan sponsor needs to pay—especially for high utilizers—dramatically increases. For smaller plans, this is a serious concern as they may not have the operational flexibility to manage this increase in financial liability.
“We have a lot of concerns of what that may mean for consolidation in the industry, potentially for small plan sponsors having to exit certain markets,” Schlaifer said. “I think that’s something we need to think about, and that’s a big concern.”
Regarding the financial responsibility shift that will result from the new CMS guidance on inflation reduction, Daniel explained that pharmaceutical companies have been focused on negotiation strategies and have not yet addressed additional liabilities resulting from the shift. Meanwhile, plans will have significantly more liabilities, leading to questions about plan management and benefit design. With the lack of clarity in the CMS guidance, it remains unclear what will happen to coverage and access, and how benefit designs will adapt to the shift. Ultimately, the challenge is to determine where the money will come from and how to ensure access to needed medications for patients.
There are also concerns from the patient perspective. Building on what he had already mentioned about the high costs he faces, Valentine expressed his worries with the IRA, noting that his disease has already outpaced the medications he is taking, and that there are new drugs in clinical trials that could be more effective. However, with the increasing costs, he is concerned about accessing those drugs and the potential for formulary exceptions. He also mentioned that his Part D premium is already at $250 a month, and with a 6% increase each year for the next 5 or 6 years, it will be difficult for other patients on fixed incomes to bear the additional costs.
“Do you think industry would have voluntarily taken these steps to reduce the cost of medication?” Connolly asked.
Ford answered that manufacturers have taken steps such as offering discounts and rebates to private parties and plans to help alleviate some of the financial burden. These negotiations between manufacturers and plans have been ongoing since the beginning of benefit, and although it is difficult to predict the future, he said it is worth noting that manufacturers have already been providing financial support in the Part D program. Ford’s comments suggest that, although there are still concerns about the implementation of the IRA, manufacturers have taken steps to help mitigate the financial impact.
At the Pharmacy Quality Alliance (PQA) 2023 Annual Meeting, held May 11-12 in Nashville, Tennessee, pharmacists talked about the different types of data that are collected and analyzed, and how data can be used to improve medication use quality.
The presenters were:
Johnson kicked off the session by clarifying key terms often confused in discussions: health equity, social determinants, social risks, and health disparities. Social risks encompass adverse social conditions that contribute to poor health outcomes, such as food insecurity and housing instability. It’s important to note that individuals may face multiple social risk factors, further increasing the likelihood of poor health outcomes.
Health disparities, on the other hand, focus differences in health outcomes affected by demographic factors such as race, gender, income, or geographic region. Johnson emphasized the significance of examining social determinants of health (SDOH), which encompass various conditions individuals are born into, including their work and living situations, age, economic, political, environmental, cultural, and social policies. As Johnson said, addressing these factors positively or negatively impacts health and ensures that everyone has a fair opportunity to achieve optimal health.
The Health Plan’s Role in Health Equity
Looking at the health plan’s role in health equity, Johnson stressed the importance of diversity in clinical data trials, as it enhances the applicability of findings to broader audiences.
“The more diversity that we have in clinical data, the more applicable it can be to all audiences that it reaches,” Johnson said. “We can also augment available data with diversity in that data, and with the use algorithms and artificial intelligence, we can also address it. There are sometimes unconscious or implicit bias that goes on with those, so acknowledging that there are some biases that may be an algorithms and artificial intelligence…is another key aspect.”
Aside from providing the right data, health plans are also responsible for several aspects of the formulary process, benefit design, and expanding patient access.
Under formulas processes, health plans should focus on improving data diversity in drug monographs, as well as specific education and considerations to pharmacy and therapeutics committees. For benefit design, Johnson said it’s important to consider health equity in the process and adjust cost sharing models based on income or disease states. Additionally, patient access is improved by use of automated tools, enhanced care coordination, and patient outreach programs.
So, where does the data come from? There are 2 ways.
Direct data is crucial and gathered directly from patients, serving as the “gold standard” for achieving health equity, according to Johnson. By actively listening to patients and understanding their unique needs and circumstances, pharmacists can provide focused and personalized interventions that can lead to even better impacts on the patient.
Indirect data refers to information inferred from external sources, such as zip codes and Census data. These sources provide details like income, education, language, and other specific factors associated with specific geographic areas. In one example Johnson gave, in California, their health plan utilizes community health advocates who serve each zip code. By analyzing the health disparities and SDOH within each zip code, they can effectively address the needs of the patients in that area. This approach enables population-level analysis and allows for a more targeted and personalized use of indirect data, such as zip code or census information.
Through these 2 types of data, a variety of information is collected, including race, ethnicity, language, SDOH, geography, disabilities, sexual orientation, and gender identification information. All of these factors play a role in narrowing the gaps in health care, and Johnson stressed that it is crucial to emphasize that these factors are equally important in achieving health equity in the United States.
Race, Ethnicity, and Language Data
After Dinh asked the crowded room of pharmacists to raise their hands if their organization is actively working with data surrounding health equity and SDOH, almost the entire room raised their hands.
Diving into SCAN Health Group’s specific journey with health equity data, Dinh mentioned SCAN’s 4.5 star rating under the CMS Star Ratings, which measures the quality of Medicare Advantage health plans and Prescription Drug Plans such as Part D. As he mentioned, SCAN has used race, ethnicity, and language data to guide much of their work in the past years in terms of identifying and addressing disparities in SCAN’s member population.
However, when SCAN used this data and stratified the population by race, that was not the case.
“We were not 4.5 stars when you looked at the different populations,” Dinh said. “Across all the measures, we had lowest performance among our Black members. Overall, in medication adherence, the lowest scores were seen with our Black and Hispanic population, and then our Asian and Black members rated us the lowest in terms of our survey measures. So, we saw these disparities and we thought, ‘this is a problem, we need to do something about it.’”
SCAN first focused on medication adherence. Among Black and Hispanic members, overall medication adherence in 2021 was about 85%, while all other members had a medication adherence of around 88%. SCAN then made it a goal to reduce that 3% gap by 25%. However, it wasn’t just a goal for the pharmacists—SCAN made it a corporate goal, tying executive bonuses to the goals and working together across the entire organization.
Within 18 months, SCAN ended up reducing the gap by 35%. How did they do this?
One notable approach was the use of race, ethnicity, and language data to match patients with appropriate health care staff, based on insights gained from interviews with Black and Hispanic members. The SCAN team learned that trust was a significant barrier to medication adherence for Black members, who expressed less trust in their physicians and more trust in other members of the health care team. For Hispanic members, language barriers were found to affect communication and the sharing of critical health information. To address these issues, SCAN Health Group stratified its member population and paired them with health care providers who could serve them in a manner that aligned with their preferences and needs. In short: patients need providers who are like them.
Dinh also mentioned the integration of race, ethnicity, and language data into medication adherence platforms, allowing for targeted interventions based on refill due dates and adherence risk. He said these platforms and algorithms are the same ones they’ve been using, just adding the extra data. SCAN also implemented cultural competency and humility trainings to ensure staff members were equipped with the skills to engage in effective conversations with members. Collaboration with the medical provider network also played a pivotal role in leveraging the collected data to guide their work.
Sexual Orientation and Gender Identification Data
While sexual orientation and gender identification (SOGI) data is relatively new to and has limitations, SCAN recognizes its importance for understanding patient representation.
Dinh explained that SCAN Health Group actively collects SOGI data through internal methods, incorporating it into their data warehouse to inform decision-making. Although disparities have not yet been identified, the integration of SOGI data demonstrates a commitment to inclusivity and addressing the unique health care needs of diverse populations.
Dinh also shared insights from a population of approximately 285,000 SCAN members, revealing that less than 1% identified as a gender other than male or female and around 20% disclosed their sexual orientation, with close to 2% of this subgroup of about 54,000 individuals identifying as members of the LGBTQIA+ community. According to Dinh, these figures emphasize the significance of capturing data to ensure representation and prompt action.
To address the specific needs of LGBTQIA+ individuals, particularly older adults facing discrimination, the organization introduced the Affirm Plan, which offers benefits such as virtual behavioral health services, companion care, legal service reimbursement, and lower co-pays for specialty medications like HIV drugs. The Affirm Plan, which currently serves around 500 members, shows how health groups can use data-driven insights to develop targeted interventions.
Social Determinants of Health
“Social determinants of health is a national priority,” Lee-Brown opened with. “In fact, it is 1 of 3 priorities for Healthy People 2030 along with health equity and health literacy.”
SDOH include non-medical factors that influence health outcomes, such as education access and quality, health care access and quality, economic stability, neighborhood and built environment, and social and community context.
While they are separate concepts, SDOH and geography are deeply interconnected, Lee-Brown explained. A patient’s socioeconomic status influences their residential choices, which, in turn, impact the educational opportunities available to them. These factors then affect their socioeconomic mobility, creating a full circle of influence. Lee-Brown stressed that, to understand how geography affects health outcomes, pharmacists must consider elements such as access to safe housing, transportation, education, job opportunities, nutritious foods, pollution levels, as well as language and literacy skills, as these factors are vital to comprehending the impact of geography on health care.
Focusing on medication quality, a central theme of PQA23, promoting healthy choices alone cannot eliminate disparities. Adherence to medication is crucial for positive health outcomes, but individuals who struggle with basic needs like finding their next meal or a place to sleep are unlikely to prioritize medication adherence. Lee-Brown emphasized that recognizing the impact of social determinants and geography is essential in addressing disparities and improving overall health care outcomes.
Lee-Brown went on to share insights from her experience working with Health First, a health care plan serving New York City residents.
Data from 2019 showed a poverty rate of 41% in New York City, highlighting the urgency to address social barriers and transform the environment for patients. According to Lee-Brown, clinical interventions alone are insufficient in a city like New York, and that health care professionals must also address the social determinants that impact access to care.
Breaking down poverty rates by factors such as race, ethnicity, borough, and educational attainment revealed uneven distribution. For instance, the Bronx had an average poverty rate of 60%, while Manhattan’s rate was below 30%. Additionally, analyzing poverty rates solely based on boroughs and averages can also lead to oversimplified data, as a deeper analysis at the neighborhood and zip code levels additional disparities and localized challenges.
By recognizing the unique socioeconomic landscape of New York City and understanding the intricacies of poverty rates across neighborhoods, health care organizations like Health First can develop tailored interventions to address the specific needs of each community. The aim is to bridge the gap between health care services and SDOH, ensuring that all patients, regardless of their geographic location or socioeconomic status, have equitable access to quality care.
“The further you can dig into your data, the more granular you can get with this data, the more impactful and the more targeted you can be with your interventions,” Lee-Brown said.
There are 4 main ways that health plans can help their populations, according to Lee-Brown. These include universal assessment, predictive analysis, hot spotting, and group-based risk stratification. Lee-Brown went on to highlight the latter 2.
Health care organizations can use hot spotting to identify areas with greater needs, such as food deserts, even without member-level data. Partnering with community organizations allows for targeted interventions like providing fresh produce. While measuring direct impact can be challenging, building trust with the community is crucial.
Risk group-based risk identification relies on member-level data to stratify populations, enabling health care organizations to address specific needs related to social determinants and geography. However, limited resources and equal benefit application regulations set by CMS pose challenges in implementation. To overcome these challenges, CMS introduced innovative models like value-based insurance design (VBID), allowing for unequal benefits for beneficiaries. For instance, co-pays can be waived for low-income members or grocery benefits offered. The VBID program for 2023 involves 52 Medicare Advantage organizations and is expected to impact around 9.3 million members.
While outcomes reports are pending, early stages of these initiatives show promise. Professionals in the Medicare space are encouraged to familiarize themselves with VBID, explore research opportunities, and engage in discussions with colleagues. It is important to recognize the availability of untapped data, including large purchasable datasets, which can empower organizations to develop comprehensive programs that better serve their membership.
Disabilities have gained attention in the health care landscape, especially with the recent focus on health equity. According to the CDC, approximately a quarter of adults have a disability, and individuals with disabilities are more likely to experience higher rates of obesity, smoking, heart disease, and diabetes. Understanding this population is crucial for developing effective programs, Lee-Brown said.
Collecting disability data offers several benefits, including improving landscape assessments, comparing against state and national data, and identifying evolving patient needs for budget forecasting. The HHS data council has recommended standards for collecting disability status, emphasizing a functional perspective and tracking disparities between populations. However, organizations should aim beyond these minimum standards and explore additional sources such as plan enrollment data and medical records.
In closing, Lee-Brown said, “You need to incentivize the folks within your organization to really have these conversations with members and collect this data to build data governance programs, so that you can effectively design and implement programs that will help you improve the life of your members.”