Everyone is talking about outrageous drug prices: $44,000 for Olysio, a drug used to treat Hepatitis C; $51,600 for HP Acthar, a gel that treats multiple sclerosis; $1,000 per pill for Sovaldi, another Hepatitis C drug, which amounts to a whopping $84,000 for a full 12-week course treatment. The tides on drug prices may soon be changing, however. With the healthcare industry’s shift towards value-based care, drug prices are also moving toward value-based pricing. Under the value-based method, a drug could be priced higher than similar medications because it lowers overall medical costs, providing greater value.
Of course, measuring value and patient outcomes isn’t always possible. This type of pricing only works for certain treatments, as long as there are no generic versions of the drug, because cost cannot be the only relevant factor when it comes to the totality of care. In addition, the medical community has to agree on a common definition of “patient outcome.” There also needs to be a way of measuring just how big of a role the drug portion of the treatment plan actually plays in that outcome. A patient’s lifestyle and medical history can cause vastly different outcomes. There are so many factors involved. Despite these limitations, value-based pricing can work, but CMS and PBMs must take the lead on disrupting the current system.
Independent providers and value-based drug prescribing
In the meantime, how can independent providers practice value-based prescribing? One way is by prescribing generics when possible. At Privia, as the Manager of Clinical Pharmacy Services, I’ve spearheaded the launch of a “Brand to Generic” conversion program, which facilitates a cost-efficient change in the scripts our physicians prescribe. We’ve customized our EHR to bring alerts to providers at the point of care by embedding tools that allow our physicians to view benefit designs to see which drugs are covered and which aren’t. We focus on clinical workflows at the POC and medication management best practices to transform the way our docs practice. This helps our independent providers have access to the critical information they need for value-based prescribing at their fingertips.
Another way physicians can participate? By improving medication adherence. Treating medication as a “vital sign” at each patient encounter ensures that barriers in taking medications are addressed and resolved. Providers should watch for red flags that indicate patients are nonadherent by asking open-ended questions about how patients are doing with their meds, or how often they miss doses.
“…remember that on average, patients remember about 50 percent of what is discussed during a medical encounter.”
Also, help your patients remember. Try to reduce the number of medications a patient is taking and set them up for success by ordering 90-day supplies and referring to mail order when possible. Lastly, make sure patients receive a printed copy of their medication list at each visit and remember that on average, patients remember about 50 percent of what is discussed during a medical encounter. The result of these efforts: patients who take their medicine on schedule are less likely to be hospitalized, which reduces costs to the system overall.
All forms of value-based management rely on data to lower costs and improve quality. The appropriate approach depends on the therapeutic area, the goals of an organization, and how data can be used to meet health-outcome and cost-reduction goals.
What are some ways you engage in value-based management? What are your thoughts on PBMs and value-based pricing? Let me know in the comments!
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