Patient-generated data could be the missing piece to new payment models for drugs and devices

Payers, providers and manufacturers see promise in value-based payments, but first they'll have to wrangle the right data.

A new consortium of payers, providers and manufacturers at the Duke Margolis Center for Health Policy aims to tackle the complex issue of value-based payment for drugs, medical devices and cutting-edge gene therapy.

A major part of that initiative will be defining the role of data in new value-based arrangements.

Stakeholders nearly unanimously agree that value-based payments for drugs and devices need to incorporate patient-generated data, in conjunction with several other data sources, to accurately measure the value of medical interventions. But there is less consensus on exactly how to do that.

Greg Daniel, Ph.D.

“More and more, the FDA, manufacturers, providers and payers are looking at patient-generated health data and want to make sure these products are delivering value to patients themselves,” Greg Daniel, Ph.D., deputy director of the Duke Margolis Center for Health Policy, told FierceHealthcare. “But we don’t have great ways of collecting data from patients.”

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Daniel is one of nine Duke researchers leading the initiative that also features an advisory group of healthcare executives, including Amy Bassano, deputy director of the Center for Medicare and Medicaid Innovation at CMS, as well as representatives from Pfizer, Allergan, Medtronic, Novartis, Express Scripts and some of the nation’s largest insurers, such as Anthem, Cigna and UnitedHealth. Some of those payers have already launched targeted value-based agreements with drugmakers for specific medications. 

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The consortium's goals go well beyond targeted agreements. Ultimately, the group wants to develop a road map for value-based arrangements, initiate regulatory changes or clarification through CMS and even push lawmakers to back new legislation, if necessary. 

A major part of that effort will involve data. Nearly everyone raised concerns about data collection and sharing during the group’s initial meetings, according to Daniel. Although mobile apps and wearables could provide tools to collect information from patients, that methodology has been historically unreliable. Daniel added that payers and providers already find it difficult to link medical and pharmacy claims data with EHRs; adding data from another source can be even more complicated.

“At the kickoff meeting, I was surprised at how often the question of how can we get more patient-generated data into this infrastructure came up—and no one knew how to do it,” he said.

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Thomas Barker
That is just one of the many challenges the consortium faces. Although it’s clear payers, providers and manufacturers are all intrigued with the concept of paying for drugs and devices based on value, that approach is stymied by a slew of regulatory barriers—including potential violations of the Anti-Kickback Statute and the Stark Law. At the same time, value-based arrangements are becoming increasingly important during a time when gene therapy and device technology is rapidly advancing, said Thomas Barker, a partner at law firm Foley Hoag, who is tasked with reviewing potential changes to federal fraud and abuse laws.

Those are some of the big issues Duke Margolis is eager to tackle beyond just a theoretical examination of value-based payments. A major part of the initiative will be pilot-testing certain payment methodologies with members of the advisory board within the next year and working with CMS to expand their scope.

“Ultimately what we’re really after is a clearer pathway for payers, providers and manufacturers to sit down and develop value-based arrangements and be able to implement those without all the barriers that exist today,” Daniel said.