Evidence: The Foundation of Payment Reform

By Howard Beckman, MD, FACP, FAACH, Chief Medical Officer –  In the February 28, 2017 issue of JAMA, Shrank, Saunders and McClellan confront the notion that insurance decisions about reforming the payment system require evidence from randomized controlled trials to be scaled by payers1.  To focus the discussion, they choose to direct discussion to reducing co-pays for high value care. As an example of data being available, they cite a study by Choudhary, Avorn and Glynn2 that demonstrated $5,000 savings per patient associated with an 11% reduction in vascular events by eliminating cost-sharing for cardiovascular medications in patients experiencing an myocardial infarction. Medicare did not accept the results because patients in the study were under 65.  Academics were unimpressed because the savings did not reach statistical significance, but the insurer who conducted the study implemented the program for its members.

The authors point out that while academics wanted to see additional studies, the payers prioritize speed and timely information for ongoing adjustments. Their summary is that “the science of payment reform should expand use of adaptive methods, recognize the different evidence thresholds for different audiences and support consistent reporting and exchange of findings from multiple sources of evidence”. In other words, academics and the “real world” stakeholders need to collaborate way more successfully, confront distrust of each other and focus on more approaches that put quality improvement at the forefront.

EagleDream Health (EDH) endorses this collaboration and is actively involved in helping create the data needed by regional health coalitions, Insurer-Provider contractors and ACOs who see the future as providing evidence of cost savings by delivering value driven care.

In addition to focusing on reducing the cost of high value care, chances of success will be supported by, at the same time, identifying and increasing cost sharing for low value care. In fact, we encourage the creation of employee or member incentives, conducting with the involvement of employees or members in the definition of what constitutes low and high value care. Given that clarity, EDH can help design dashboards and reports to identify unnecessary variation in the use of high AND low value services and encourage behavior change that BOTH rewards care that improves outcomes and discourages care that reduces patient safety. Low value care does not improve outcomes but does have associated costs and risks. If a person develops an adverse event from a procedure or medication that would not help, unnecessary harm is the result. And these wasted costs could be applied to improving chronic disease care or reducing premiums.

  1. Shrank WH, Saunders RS, McClellan M. Better evidence to guide payment reforms: Recognizing the importance of perspectives. JAMA. 2017;317:805-6.
  2. Choudhary NK, Acorn J, Glynn RJ, et al. Post-myocardial infarction free rx event and economic evaluation (MI Free) Trial. N Engl J Med. 2011;365(22):2088-2097.

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