By Ankush Patel, MD, Strategic Planning Supervisor, Mosaic
In contrast to global markets, the US does not have a single arbitrator of value. Over the decades, payers have typically relied on third-party value assessors to inform coverage decisions.1 The recent drug-pricing provisions of the Inflation Reduction Act (IRA) have placed a new spotlight on value assessment frameworks for pharmaceutical products in the US healthcare system.2 Many in the industry are asking, has CMS become a health technology assessment body in the US?3 To fully understand this question, it is important to understand who the current players are in the value assessment of pharmaceutical products, what value assessment looks like today in the US and how payers are utilizing these frameworks in their coverage decisions.
As therapies have become increasingly more costly, payer budgets have tightened as payers continue to look for ways to reduce costs.4 While efficacy, safety and other clinical benefits of a drug have been at the forefront of coverage decisions, the value and cost-effectiveness of products have become increasingly critical.5 A recent Academy of Managed Care Pharmacy (AMCP) survey indicates that payers view value assessment frameworks and specialty society guidelines as the most useful sources of information for informing coverage and formulary decisions within their organizations.6 Survey results also show that 85% of US payers polled are interested in having a national assessment body that evaluates best practices and standards for value assessment frameworks.6
US-based value assessment frameworks6-7
- National Comprehensive Cancer Network® (NCCN) evidence blocks
- American Society of Clinical Oncology (ASCO) Value Framework (US oncology, solid tumors)
- American College of Cardiology (ACC) and American Heart Association (AHA)
- Institute for Clinical and Economic Review (ICER) evidence reports
- International Society for Pharmacoeconomics and Outcomes Research (ISPOR) special task forces
- National Health Council (NHC) patient-centered value model rubrics
- Innovation and Value Initiative (IVI) Open-Source Value project models
Additional sources of value assessment information6-7
- Specialty society guidelines
- Academy of Managed Care Pharmacy (AMCP) dossiers
- International Health Technology Assessment (HTA) sources
- Patient-Centered Outcomes Research Institute (PCORI) comparative effectiveness research
While the US does not have an official national health technology assessment (HTA) or assessment body that reviews best practices, recent decisions by CMS, as part of the pricing negotiations provision in the IRA, may suggest they are moving in this direction.2,3 The 2022 CMS pricing negotiation provision allows CMS to negotiate drug prices with manufacturers, which suggests that any data submitted by manufacturers will be analyzed and reviewed by CMS.2,3 Congress has established that CMS must take into consideration a drug’s therapeutic benefit and information about comparative effectiveness when conducting its review.2,3,8
CMS has also signaled a shift towards taking on the role of an HTA body with its decision to require prospective data collection for recently approved drugs in the Alzheimer’s space.9-10 CMS requires physicians and clinicians to participate in prospective data collection to inform questions about the efficacy and safety of a drug and whether the drug improves health outcomes based on real-world evidence.9-10 CMS has stated these data will be available online and will allow researchers to conduct additional studies to further understand how a drug can benefit Medicare beneficiaries.9-10
Obesity is another area where CMS can influence access due to the current prohibition of Medicare coverage for weight-loss drugs.11 After the recent indication expansion of an anti-obesity medication into cardiovascular disease, CMS issued a memo indicating that Medicare Part D plans can add the drug to their formularies now that it has a medically accepted cardiovascular indication.11 While obesity drugs without medically accepted indications continue to be excluded from Medicare coverage by law, additional indication expansions may lead to broader coverage of these products.11 If CMS does decide to expand coverage of these drugs solely for obesity, it will require careful assessment of the drugs, benefits, risks and value by CMS, and its actions may go on to influence other stakeholders such as commercial payers and employers.3,11
There are several implications for payers that manufacturers should be aware of:
- As CMS continues to take on certain responsibilities of an HTA body, most payers are likely to support this move and leverage CMS as an additional source of evidence to inform coverage decisions
- Some payers, however, may oppose CMS potentially acting as a true HTA if future reviews restrict their autonomy when it comes to pricing and formulary decisions
- Payers are likely to welcome value-based framework assessments from organizations such as ICER more so than others given their independence from both the federal government and pharmaceutical companies
With the potential for CMS to take on certain responsibilities of an HTA body, pharmaceutical manufactures, specifically, market access marketers should consider:
- Proactively assessing how CMS taking on more responsibility will impact their business
- Monitoring how the role of CMS evolves and how much influence it will have with payer stakeholders
- Adapting and evolving their access strategy for demonstrating value and achieving favorable access recommendations
Summary
While CMS has not formally called itself an HTA body in the US, many of its recent actions show that it may have started to assume this role. The prospective data collection in the Alzheimer’s space and IRA drug price negotiations signals a shift, but there is still a long way to go before CMS will be viewed as a full HTA-like body. As CMS continues to make coverage determinations on new products, it will be important to monitor how commercial payer stakeholders adapt their access and product coverage strategies. Those in support of CMS as an HTA argue that they have a right to evaluate evidence and data of products they reimburse, and payers are likely to be in support of CMS as the number of complex therapies coming to market continues to rise.
How can we help? If you have any questions or would like to discuss this topic further, please contact hello@mosaic-mm.com.
References
1 Payer perceptions and use of value assessment tools in the United States
2 Inflation reduction act renews focus on value assessment in the US
3 Turning CMS into a Health Technology Assessment Organization
4 Payer perceptions and use of value assessment tools in the United States
5 Inflation reduction act renews focus on value assessment in the US
6 Westrich K, Riggs K, Hatton J. Optimizing value assessment tools for coverage and reimbursement decisions: promises and pitfalls. Presented at: AMCP Nexus; October 16-19, 2023; Orlando, FL.
7 Payer perceptions and use of value assessment tools in the United States
8 Medicare drug price negotiation: the complexities of selecting therapeutic alternatives for estimating comparative effectiveness
9 New Alzheimer’s drugs spark hope for patients and cost concerns for medicare
10 CMS announces new details of plan to cover new Alzheimer’s drugs
11 A new use for Wegovy opens the door to medicare coverage for millions of people with obesity
