Discussing Value in Hematology:
A Roundtable With ZS Associates
A survey on “Trends in Value and Practice Management in Hematology” conducted at the 2015 American Society of Hematology (ASH) Annual Meeting by ZS Associates and M3 Global Research revealed common drivers among survey respondents including cost, outcomes, and financial concerns.
Hematologists/oncologists who participated in the survey (n=100) met the requirement of spending the majority of their practice time treating patients. The survey excluded physicians working in a VA or government hospital or those employed with Kaiser Permanente.
OBR discussed the survey’s findings with three experts from ZS Associates: Maria Whitman, Managing Principal of ZS’ Global Oncology and Specialty Therapeutics Practice; Howard Deutsch, Principal and Lead of Managed Care Strategy Practice; and Christina Corridon, Manager in the ZS Oncology vertical.
Below is an excerpt of that conversation.
On Prominence of the Value Dialogue and New Value Frameworks
OBR: Before we get to the survey results, cost and value were discussed at both ASCO and ASH. What do you make of how prominent the value discussion is becoming?
MW: At ASCO this year, the conversation around cost in relation to benefit was significant. Hematologists at ASH referred more to “value” as a point of discussion.
CC: Hematologists at ASH seemed to see the innovations presented at the conference and those they are adding to prescribing habits today as outweighing potential cost concerns. Hematologists’ deeper focus on the value aspect of therapies only further speaks to the impressiveness of the latest innovations in this space.
OBR: Earlier this year both ASCO and the NCCN introduced measures of value. What did your survey reveal about how the concept of value is being understood and implemented by hematology practices?
CC: Oncology frameworks are very new to the market and more widespread utilization is yet to be realized. Our survey findings demonstrate that the ASCO Value Framework and the NCCN Evidence Blocks are emerging levers that are still very new in the market. Only 10% of survey respondents had high awareness of them, while 26% had no awareness. At this point, other strategies from payers are likely having a deeper impact on providers as 70% of respondents reported that most of their decisions are impacted by payer management, particularly in diseases most crowded with treatment options.
HD: Survey respondents are clearly feeling pressure and some level of scrutiny from payers. Expectations are that the value frameworks are going to be more influential in the future, but tremendous uncertainty exists about how they are going to play out. We are in a transitional time, meaning treatment influences in 5 to 10 years will look much different than they do today, but no one has a consensus about exactly how.
Discussing Value in Hematology:
A Roundtable With ZS Associates (continued)
OBR: How do you think value frameworks will affect payer decisions?
HD: Cost is becoming more prominent in the ASCO and NCCN concepts of value, but it’s still not clear how the cost/value translation will take place. It’s unlikely that a payer will decline a treatment due to ASCO value scores alone, but what mechanisms might payers use to push utilization of “higher value” treatments? Perhaps it will be differential reimbursement, like with Anthem’s Pathways program. Overall, the jury is still out on how to translate value frameworks into treatment practice, with lots of experimentation going on about how this will work.
MW: Some of the frameworks are more directive about an assessment of value while others are left more to physician interpretation. But how to interpret them and bring them into a clinical treatment decision has many layers to be worked out. Questions come down to acute disease vs chronic disease or crowded therapy options vs unmet need. These answers will have an impact on value, which may lead to variation in how payers impose cost management.
On Physician Awareness and Consideration of Value & Costs as Decision Drivers
OBR: Overall, how is provider awareness of value and cost evolving? How are physicians’ decisions being driven by awareness and consideration of value and costs?
MW: Some providers have adopted a mindset of financial responsibility in particular due to the financial burden on patients. Others are beginning to think more broadly about long-term, system-level sustainability as the focus continues to shift to quality of care and value. But, clinicians don’t have an informative method to assess value, when cost is not something that is right in front of them at the point of service. We still have a long way to go to provide physicians with the necessary tools to discuss cost options with patients, and in a way that also incorporates value.
CC: We have evolved from 2 primary dimensions of decision – efficacy and safety – to three – efficacy, safety, and cost. Increasing transparency on cost is one objective of initiatives like the new value frameworks. However those who are looking at full system costs recognize that the cost of healthcare includes more than just the price of drugs, but all of the elements are creating ramifications on many elements of healthcare, including population management, CMS, and the healthcare system as a whole.
HD: The value frameworks have the potential to enable a deeper conversation with a patient if that patient is concerned about cost. The frameworks allow for a more informed treatment discussion about value and cost tradeoffs. However, these frameworks present a risk of being used by payers to push physicians in certain directions, which may or may not be in the best interest of the physician-patient dynamic. Both the industry and manufacturers need to track and pay attention to how frameworks get adopted so they can be sure that information is being used appropriately.
OBR: How are practice economics shifting, if at all?
HD: One longstanding trend in economics for hematologists and oncologists is that buy and bill has declined. The spread of buy versus bill for drugs, meaning the cost to buy versus the reimbursement through billing, is being reduced over time due both to the federal budget sequester and to lowered reimbursement among payers. Another trend is the shift in the site of care as independent community practices affiliate with hospitals eligible for 340B discounts. These two longstanding trends will continue, at least for a bit.
MW: Many of the top concerns raised by our survey respondents were related to economic and organizational factors, such as migration from fee-for-service to bundled payments, electronic medical records (EMRs), and implementation challenges due to continued consolidation. The typical oncologist is now part of a consolidated practice. This has led to a shift in conversation around value, and not just for the physician but very much at the account level. Because of consolidation, entities such as hospitals, rather than individual physicians, are making economic and organizational decisions. These concerns will continue to impact overall practice management.
CC: Being well-versed in the business of oncology is becoming an absolute requirement for a practice to be successful; this knowledge has to either be built into a practice by hiring consultants or practice managers or a practice may decide to consolidate.
On Specific Measures to Manage Spend
OBR: What specific measures are hematologists taking to manage drug spending?
MW: Practice economics are very much in mind when hematologists (and oncologists) talk about managing drug spending. Hematologists/Oncologists look to make the best treatment choices for their patients regarding product. If a generic is available and believed a good therapeutic choice for the patient, it can be a good first option.
Discussing Value in Hematology:
A Roundtable With ZS Associates (continued)
OBR: What about choosing hospice and end-of-life care treatment?
CC: End-of-life care is perhaps least used to minimize drug spend, particularly in oncology. Hospice-care use has tremendous room for improvement in oncology. There is a lack of understanding of what good end-of-life care looks like. Care at the end-of-life has a tremendous amount of cost affiliated with it. Determining end-of-life differs greatly between chronic and acute conditions in hematology.
MW: The survey showed 19% choose hospice discussions for end-of-life care. There has been more attention given to this conversation very recently in particular because of the question of quality of life in the later stages of treatment. This is a topic OBR and others have brought more attention to as efforts have been made to reinforce the importance of more formal end of life discussions with patients.
On Implications for Manufacturers
OBR: What are the implications for manufacturers for pharmaceutical customer engagement as value becomes a much bigger part of the conversation?
CC: Value is an important factor in the conversation now, as the model of customer engagement in oncology continues to evolve in many ways. That evolution includes the types and importance of key areas of discussion, with cost being just one of many factors among the changes occurring. Manufacturers need to be able to demonstrate value in outcomes and in conversation not only with the hematologist, but also with various stakeholders affiliated with the financial concerns of the practice.
About the Contributors
ZS Associates is the world’s largest firm focused exclusively on improving business performance through sales and marketing solutions, from customer insights and strategy to analytics, operations, and technology.
M3 Global Research provides market research recruitment and support services to the global healthcare industry, with relationships with over 2.5 million physicians in more than 70 countries worldwide.
Maria Whitman is Managing Principal of the ZS Specialty Therapeutics and Oncology Practice. She has advised established and emerging companies on strategic marketing and sales issues including launch excellence, brand and portfolio strategy and customer experience. Maria has an MBA from Wharton and a BS in Marketing from La Salle University.
Howard Deutsch is a Principal and Lead of the Managed Care Strategy Practice with ZS Associates. He has helped clients with a spectrum of sales force and marketing issues, with a particular focus on U.S. managed-care and market access strategy. Howard has an AB in Economics from Princeton University.
Christina Corridon is a Manager in the ZS Oncology Practice with a specialization in biosimilars. She has advised on sales and marketing strategy engagements, including launch excellence, brand and portfolio strategy, Go-to-Market, and competitive scenario planning. Christina has an MPH from the UCLA Fielding School of Public Health, an MBA from the Stern School of Business, and a BA from Cornell University.