Tracking the Performance, Challenges, and Evolution of Value-Based Contracts: Neha Kashalikar, PharmD

Evidence-based outcome measures are ideal when structuring value-based contract agreements (VBCs) says Neha Kashalikar, PharmD, director of strategic pharmacy consulting, MassHealth.

This transcript was lightly edited; captions were auto-generated.

Transcript

What types of outcome measures and performance benchmarks are most used in VBCs to ensure accountability and demonstrate therapeutic value?

We look to the evidence-based medicine to help us when we're structuring a clinical outcomes-based agreement, looking to see if there's a pharmacy claim or a medical claim that can be tied to answer whatever that unanswered question the VBC is hoping to structure around. For example, if we're looking at a chronic therapy where there are frequent relapses, like multiple sclerosis, hospitalizations could be used as an end point to determine what the hospitalization has been like, pre-product and post-product, and that can be done on a patient level or on a population level. Pharmacy and medical claims are definitely a great place to start and are easily accessible and verifiable for payers.

There's also value in using end points that may be found in medical records, particularly if there isn't a claims-based outcome that would fit very well into a clinical therapeutic class. In that situation, we'd be really looking for something that the provider is tracking as a part of standard care so not to create any undue or additional burden on the provider or on the patient in that situation and really looking for something that would be easily collectible through either a prior authorization or a request for medical records, something like that.

What tends to not be the greatest outcome is things that are more subjective in nature. There are certain disease states where it's really challenging to structure an outcomes-based agreement, and we may want to look to other value-based constructs in that situation. For example, you could look for an adherence-based construct. If you have a product that's more costly than others in the class, it may be an opportunity for you to look to see what type of adherence outcomes occurred with that population. If you're not seeing that improved outcome, perhaps it's not the best product to help improve adherence or durability and may not be worth that additional premium that you'd be paying for the product. There are also other varieties of constructs, but really, it's just thinking about the question that you're trying to answer through this value-based contract and structuring it accordingly.

What are some of the key operational or administrative challenges organizations face when implementing VBCs, and how can these be addressed?

What we'd be looking for in these types of outcomes would be, ideally, claims-based outcomes, something that's typically reported by a provider. Where we might hit up against challenges is if you have a class where there is an outcome that is subjective in nature or that potentially requires additional outreach to be able to find that outcome. Patients are obviously transient in nature. If they want to move from one place to another, they should be able to do that, but being able to collect outcomes becomes more challenging in that situation.

I think one of the strategies we've thought about, particularly for rare cell and gene therapies where we have contracts in place, is ensuring we understand where the qualified treatment centers are and hoping to use that as a network to be able to track down outcomes. If you know a patient has been treated in Massachusetts and moved out to California, but there are limitations there, it's definitely a challenge associated with value-based contracting, but something that we are hoping eventually to find some creative solutions to work through.

As the adoption of VBCs grow, how do you see these contracts evolving to accommodate emerging therapies, especially in areas like gene and cell therapy?

I think value-based contracts are incredibly valuable for cell and gene therapies. These are novel therapies that are often lifesaving and definitely transformative for patients, and they're priced to be as such. These are multimillion-dollar, one-time therapies. I think where value-based contracting comes in is to ensure that we have a safety net, that the drug is really performing the way that we would expect it to.

Whether that's looking at clinical outcomes to ensure that they continue to benchmark to the standards that we're seeing in clinical trials or even ensuring that these trials maybe were only for 3 years in duration, we hope to see that these outcomes have continued durability, going out 5, 10, as many years as possible, to ensure these patients continue to see lasting effects. So, value-based contracts are a really critical tool to make sure we are actually seeing these novel therapies and these transformative therapies being able to hold up to the expectations that we have.