Making high-value care a reality
Value-based insurance design can fund the best new therapies
In healthcare systems such as that employed in the US, where insurance is the primary route for funding care, it is of critical importance that the rules that govern how plans pay for treatment are drawn up in a manner that is both equitable and effective.
The question is: how can insurance be structured to promote the use of ‘high-value’ care – that is, care whose effectiveness is proven – over low-value care that has unproven or only limited effectiveness? In recent years, as authorities look for ways to maximize the effectiveness of healthcare funding, value-based insurance design (V-BID) has gained prominence in discussions.
Cancer screening provides a good example of V-BID’s potential impact. Catching cancer in the early stages not only improves the outlook for individual patients, it also reduces the need for expensive, resource-intensive late-stage treatments. Financially, that benefits both the patient and their employer, who typically provides funding via an employee benefit plan.
The recommended age for colorectal cancer screening in the US, for instance, recently dropped from 50 to 45. “Based on the evidence, 20 million more Americans should now be screened,” suggests Dr Mark Fendrick, Director of the V-BID Center at the University of Michigan. This shift towards high-value (i.e. at a stage when it can be effective) intervention is set to deliver substantial benefits.
Sending funds where they are most needed
However, according to Dr Fendrick, there is still a significant problem with the screening window for colorectal cancer: its overuse among the over-85 demographic. The evidence indicates it is of low value for that age group – and could even be harmful. Narrowing the window to a younger demographic would reduce this potential for harm and free up resources.
“We can use those savings not only to enhance the rate of screening for people who are eligible,” explains Dr Fendrick, “but also to cover the services that patients might need to get their disease under control, such as molecular testing or procedures, surgeries, chemotherapy and immunotherapy.”
Redirecting funding to proven high-value treatments via V-BID is an area of increasing interest for employers. Many face rising costs in relation to their health-benefits plans and, while they want to give their employees the best possible care, they don’t want to waste money finding it. Some – including MSD (known as Merck & Co. in the US and Canada), which has been running a V-BID Oncology Pilot – are now working to introduce V-BID elements into their employee plans.
At macro level, it is an enormous opportunity, enthuses Dr Fendrick. “Billions of dollars are spent annually in the US on services that have been proven not to improve the health of the person who receives the service,” he explains. “Wasteful spending could account for as much as $1 in every $4 spent on healthcare in the US.”
Cutting waste to focus on high-value care
While inefficient spending is an issue for the healthcare system as a whole, the challenge for oncology is especially pressing. In many countries, cancer rates are rising due to ageing populations.
Innovative new therapies that have the potential to transform patient outcomes are anticipated but will inevitably put a strain on the purse strings. V-BID offers a solution: “Identifying, measuring, reporting and reducing low-value care is my way, at least in the short term, of bringing about meaningful increases in expenditure on these very exciting but expensive services, without having to raise the total budget,” says Dr Fendrick.
Delivery mechanisms must keep pace with innovation in treatments. To that end, the Center for V-BID recently developed a ‘V-BID X’ plan that offers a template to help employers interested in incorporating cost-neutral, value-based principles into healthcare plans. It sets out an approach that makes selected high-value services more accessible.
With cancer care budgets under pressure, the wider adoption of V-BID could help establish a more effective fund-distribution system, sending the money to where it is most needed. As Dr Fendrick suggests, “There’s great potential in robbing low-value care Peter to pay high-value care Paul.”