An outcomes-based agreement between Highmark and Boehringer Ingelheim has resulted in a total cost of care reduction of more than 20% for adult patients with Type 2 diabetes and known cardiovascular disease, the companies recently announced.
The agreement, which launched in 2018, was designed to evaluate the costs of care over a one-year period for patients who took the medication Jardiance compared to those who were prescribed other branded or generic anti-hyperglycemic medications.
For medical costs alone, patients on Jardiance demonstrated a cost reduction of more than 30%, according to Highmark. When factoring in both medical and pharmacy costs, the cost of care was reduced by more than 20% for patients on Jardiance.
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WHY THIS MATTERS
Value-based arrangements between payers and pharmaceutical manufacturers are becoming more popular in response to continually rising healthcare costs. These agreements are particularly useful for innovative and often costly treatments that are targeted at smaller patient populations, according to a report in Value in Health.
"By linking payment for treatments with high price tags to their real-world outcomes, VBAs have the potential to promote the use of more effective treatments and reduce spending on low-value care, helping contain overall healthcare costs in the United States," the report said.
More than 34 million Americans have diabetes, and these patients incurred about $237 billion in direct medical costs in 2017, according to the American Diabetes Association. An individual diabetes patient can expect to pay about $9,600 each year on diabetes medical costs alone, the ADA said.
THE LARGER TREND
As value-based arrangements become more common in the U.S. health system, leaders now must figure out how they are best implemented. Whether it's through a health system contracting outcomes-based agreements with insurers, through networks of independent practices or through accountable care organizations, what matters most is that patients are getting the best care for their money.
The Centers for Medicare and Medicaid Services has recognized the need for value-based care and has begun making it easier for states, drug manufacturers and commercial payers to make agreements.
Most recently, it issued a final rule that promotes value-based drug purchasing agreements. The rule promotes value-based purchasing arrangements by allowing for negotiations around drug prices to be based on evidence-based outcomes such as reduced hospitalizations, lab visits or physician office visits, which ensures that if the drug is not effective, the payer is not held accountable for the full price, CMS said.
ON THE RECORD
"Highmark is committed to developing solutions that provide access to treatments that improve outcomes and reduce the total cost of care for chronic conditions like diabetes and heart disease, which have a huge impact on our members and on our healthcare system," said Kayse Reitmeyer, a manager of Pharmacy Contracting at Highmark. "We are pleased with the results of our outcomes-based agreement with Boehringer Ingelheim, and we look forward to applying these insights to continue ensuring access to products that provide both clinical and cost savings benefits for our members."
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