Value Viewpoint: July 12, 2024

The July 2024 issue of Value in Health has a number of interesting articles focused on a broad range of topics, from improving the methods of economic evaluations to the development of new value assessment frameworks to determining how to better incorporate well-being into healthcare decision-making:

• Values Beyond “Health” in Budget-Constrained Healthcare Systems explores how to incorporate dimensions of value not directly captured by QALY-like measures in a comprehensive, methodologically sound manner and how to move from “health” to “welfare” when measuring the value of increased healthcare use.
• From Health to Well-Being: Toward a Monetary Valuation of a Well-Being-Adjusted Life-Year uses contingent valuation to estimate the monetary value of a well-being-adjusted life-year (WALY) from 7 European countries and finds that the willingness to pay (WTP) per WALY averaged between €13,323.28 ($14,324.60) and €61,375.63 ($66,442.19) for 1 month of avoided losses.
• Methods for Including Adverse Events in Economic Evaluations: Suggestions for Improvement (paywalled) seeks to identify the issues involving adverse events in economic evaluations and to provide good practice recommendations for addressing these issues.
• Challenges of Incorporating Life Cycle Drug Pricing in Cost-Effectiveness Models: A Review of Methods and Modeling Suggestions (see the March 22 Value Viewpoint for previous write-up)
• Development of a Value Assessment Framework for Pediatric Health Technologies Using Multicriteria Decision Analysis: Expanding the Value Lens for Funding Decision Making (paywalled) (see the March 29 Value Viewpoint for previous write-up)
• Tackling Challenges in Assessing the Economic Value of Tumor-Agnostic Therapies: A Cost-Effectiveness Analysis of Pembrolizumab as a Case Study (paywalled) (see the March 29 Value Viewpoint for previous write-up) 

Last week, a new article in Health Affairs Forefront discussed the need to include more healthcare services and procedures in value assessment. Although services and procedures account for ~70% of healthcare spending in the US, they account for only 42% of published cost-effectiveness analyses (CEAs). This starkly contrasts with pharmaceuticals, which account for ~15% of healthcare spending but 43% of published CEAs.

The authors also point out that considerable research has focused on low-value services and procedures, but this research has typically focused on clinical assessments, not economic evaluations. NPC has highlighted this topic for many years (see our Low-Value Care landing page and Health Care Spending Guiding Principles).

There are many challenges in identifying and addressing low-value care. As the authors state:

”Researchers have underscored that tackling the problem of low-value or unnecessary care will require multifaceted remedies, including financial incentives to discourage it, quality-improvement and educational efforts that highlight overuse, and organizational changes, such as behavioral nudges (such as leveraging electronic health records to deliver suitable prompts). But it will also require more formal value assessment.”

The article highlights distinct challenges with conducting value assessments on services and procedures to identify low-value care. Specifically:

• a lack of randomized clinical trial evidence,
• weaker financial incentives to develop evidence, as intellectual property rights typically don’t exist, and
• physician learning and experience play a key role, which can be hard to measure and incorporate in an analysis.

To overcome these challenges, the following four prioritization techniques are put forth:

• horizon scanning,
• examining prevailing spending patterns,
• employing an index of variation, and
• value of information analysis.

I appreciate the authors' and the Broader Value Initiative’s (BVI) efforts to improve value assessment methods and data sources to help broaden the scope of value assessment systemwide. I agree that it is an important starting point for understanding and addressing wasteful spending across the healthcare system. Reducing expenditures on low-value care frees up resources to invest in high-value care. 

A new research article in Value in Health explored the uncertainty surrounding long-term effectiveness data used in health technology assessment (HTA). Conducting a value assessment with limited long-term effectiveness data is a well-known challenge, particularly as HTA bodies try to balance patient access to needed therapies with the risk this uncertainty represents.

To assess how different HTA bodies addressed this issue, study authors reviewed 49 HTA reports from 6 HTA bodies for 9 medicines for spinal muscular atrophy, cystic fibrosis, and hypercholesterolemia. They found that uncertainty regarding long-term effectiveness was an important consideration in 91% of all cost-effectiveness assessments included in the review and 74% of relative effectiveness assessments.

Importantly, the study authors noted differences among HTA bodies in the methodologies used to address this uncertainty. They found variations in the amount and type of long-term effectiveness data used by HTA bodies attributable to differences in timing and inclusion criteria. They also found variable use of outcomes-based managed-entry agreements and reassessments among HTA bodies, which may help manage uncertainty and payer financial risk, but for which more research needs to be done to ensure effective implementation.   

Another new research article in Value in Health (paywalled) explores orphan drug programs. Most developed nations have introduced programs to incentivize the development of therapeutics for rare diseases, but how these conditions are defined and prioritized is variable and not as clearly defined.

In the study, the authors find three distinct pillars of support for orphan drug programs,

“One relies on proper valuation of medical interventions using the GRACE methodology, wherein individuals hold greater value for health gains for higher-severity disorders. The second pillar shows how proper social welfare functions incorporate this valuation, combined with the almost-universal support for horizontal equity. The third analyzes the consequences and limitations of anonymous altruism as a basis for support of orphan drug programs.”

Clarifying how society values treatments for rare conditions matters for improving future regulatory or legislative efforts to make these programs more effective and more impactful for patients most in need of new treatments. 

Before the holiday, ICER released its Revised Evidence Report assessing the comparative clinical effectiveness and value of imetelstat for the treatment of anemia in myelodysplastic syndrome (MDS). The revised evidence report comes after a four-week open comment period. Next, the report will be reviewed at a virtual public meeting of the CTAF on July 19, 2024. 

The Innovation and Value Initiative (IVI) announced the publication of the three winners for its Valuing Innovation Project (VIP) call for papers. About the project, Richard Chapman, PhD, IVI’s Chief Science Officer, said,

“These papers provide novel methods and frameworks that will help us more accurately measure and reward the value of medical innovations, encouraging further innovation that will ultimately benefit patients and healthcare systems globally.”

The papers have been published in the Journal of PharmacoEconomics and include:

• Incorporating Real Option Value in Valuing Innovation: A Way Forward which uses a “minimal modeling” approach to estimate real option value (ROV) in HTA without building a full cost-effectiveness model.
• The Value of Flexible Vaccine Manufacturing Capacity: Value Drivers, Estimation Methods, and Approaches to Value Recognition in Health Technology Assessment evaluates flexible vaccine manufacturing in responding to health threats as well as the tools needed to measure this flexibility and any gaps that exist methodologically in this measurement.
• Estimating and Rewarding the Value of Healthcare Interventions Beyond the Healthcare Sector: A Conceptual Framework uses a digital therapeutic case study to put forth a new framework for capturing broader economic, social, and environmental impacts of treatment.