Value-based healthcare is the simple idea that a healthcare system must be designed to deliver value for patients. This means judging the system by patient outcomes and the costs to achieve them, and organising care around patients’ medical conditions
Harvard Professor Michael E. Porter and Elizabeth O. Teisberg’s 2006 book, Redefining Health Care Creating Value-Based Competition on Results, described some of the problems in the US system. You can read a great summary of the work on the Harvard Business School website. Despite high spend per citizen, the US healthcare system was getting poor outcomes in certain areas due to complex management structures and payment models, where competition didn’t happen at the patient outcome level.
As HBS summarises, progress in costs and patient outcomes had been lacking in the face of these difficulties, despite lots of improvements in areas such as electronic health records, big data, personalised medicine, and so on.
Pharma companies explore outcome-based programs
With an increased focus on patient outcomes, preventative healthcare is becoming more important, and pharma companies are striving to help patients manage disease and even avoid getting sick altogether. But how is this shift shaping how pharma companies target and engage customers?
Pharma companies are starting to recognise the advantages of a value-based model, mostly in relation to strengthening their own value proposition within the healthcare system. As KPMG explains, outcome-based programs can enable pharma companies to gain market access in settings that might otherwise be locked, as well as offer a competitive advantage and faster market access elsewhere.
KPMG’s report also highlights existing examples of pharma companies that have begun the shift to value-based healthcare, launching initiatives that enable patients to access lower cost care. Novartis, for example, offers a value-based pricing framework, whereby payments “depend on the patient, healthcare system, and societal value of medicines.”
Elsewhere, Johnson & Johnson has partnered with healthcare contracting platform, Lyfegen, a platform which digitises and automates the execution of value-based healthcare agreements.
Empowering patients to share real-world data
Post-Covid, many patients are taking greater control over their healthcare journeys, seeking out information for themselves and participating in proactive health management via wearables and digital health apps. This also means that pharma companies are placing greater emphasis on transparency, and the sharing of data.
As such, pharma companies are increasingly involving patients in research and development, using their data to uncover new methods to treat and prevent diseases.
In 2022, for example, the US National Heart, Lung, and Blood Institute was awarded $37 million to study whether the Apple Watch can be used as part of a strategy to reduce the reliance on blood thinning medication among atrial fibrillation sufferers. With medication often presenting its own risks such as bleeding, the seven-year study aims to determine if there is an alternative to the ‘one-size-fits-all’ approach to treatment.
“If we can show this strategy is equally protective against stroke and reduces bleeding, that could save lives, reduce cost, and improve quality of life,” explained Rod Passman, MD, director of the Center for Arrhythmia Research.
It’s not always easy to engage patients in generating real-world data, of course, which has spurred on several digital health companies to help bridge this gap. One example is Huma, which has recently launched the ‘Bayer Aspirin Heart Risk Assessment’ – an online tool that assesses an individual’s risk factors for developing cardiovascular disease over the next 10 years. The information generated can then be shared with healthcare professionals as part of ongoing health management.
Elsewhere, StuffThatWorks – a patient community program – has recently expanded to launch StuffThatWorks for Life Sciences, which effectively connects pharma companies with patients to partake in clinical trials. Yael Elish, CEO and co-founder of StuffThatWorks explained that the aim is to “amplify the patient voice and channel this data to bridge the communication gap between patients and pharma. In doing so, the opportunity to optimize clinical trial design, improve upon the development of therapies and better tailor care to the needs of the patient, becomes a reality – bringing us one step closer to better outcomes for all.”
Health analytics data company Evidation has also launched several trials to help understand and improve treatment of specific conditions, via real-world data from wearables and self-reported information. One of its most recent programs is FluSmart, which helps patients detect flu in its early stages by monitoring changes in their activity levels and pointing them to nearby resources if appropriate. According to Evidation, almost 90,000 people had signed up for the 2022 flu season by October of the same year, highlighting the growing willingness of patients to offer up valuable data.
Using digital tools and services to engage HCPs
Engaging healthcare professionals is an important factor in creating a value-based care system that is focused on delivering high-quality and cost-effective care to patients. HCP engagement can help pharma companies to better understand the needs and concerns of patients, which in turn can inform the development of new treatments and support services.
Pharma companies are increasingly engaging healthcare professionals through digital platforms, however delivering impactful content remains a big challenge. According to research by EPG Health, 77% of pharma and 68% of service providers find ‘providing real value’ a major challenge for digital HCP engagement, with the majority of HCP’s favouring third-party or independent content, as it is perceived to be more credible and trustworthy than pharma-created content.
Educational platforms, such as EPG Health’s Medthority, are helping to bridge this gap, offering content tailored to healthcare professionals and increasing digital engagement with pharma through sponsorship opportunities.
As reported by PMLive, Chris Cooper, Founder and CEO for EPG Health commented that the platform is a “credible and independent environment away from the background noise of advertising and overt promotion.
Improving value for patients through digital support
A value-based healthcare model means going beyond the product and focusing on the entire patient experience. Consulting firm ZS, a specialist in healthcare transformation, describes this patient-centric approach as “looking beyond how patients interact with their own organizations to the way in which they interact with the entire healthcare ecosystem.”
Essentially, for pharma companies, this means finding ways to support patients before, during, and after treatment.
This is increasingly being done via partnerships with digital health companies to offer solutions that monitor and manage specific conditions, with some also using AI to predict when conditions might worsen or flare up. Pfizer, for example, has recently partnered with Ada Health to launch an AI-assisted app, which helps users learn if they have any factors that place them at high risk of progression to severe Covid, and connects them with healthcare providers for evaluation and treatment if necessary.
Digital health tools solutions are also helping patients manage chronic conditions such as diabetes, eczema, and asthma. Propeller Health’s app, for example, informs patients of their medication usage trends and provides daily tips and education to help them control their asthma.
Increasingly, pharma companies are recognising the wider impact of these chronic conditions on mental health, with some using digital solutions to support patients in this way. Sanofi has partnered with mental health app provider Happify Health to offer support to MS patients also suffering with depression and anxiety, launching an app that combines CBT and mindfulness techniques to alleviate symptoms.
While breakthroughs are being made in the use of digital tools for patient support, there’s still a long way to go before this type of technology is effectively integrated into the wider healthcare system in any unified way. In the UK, Rory Cellan-Jones has recently written about the impact on patient experience of interoperability between systems, and spoke to Public Digital’s Chris Fleming (who previously worked on delivery of the NHS app) and MD of Imperial College Health Partners, Axel Heitmueller. Cellan-Jones concludes, “I’ve met lots of people playing catchy digital tunes in the NHS but without a conductor to tell them how everything fits together they risk creating a discordant mess.”
With a new focus on patient-centricity, however, it’s likely that we will continue to see further investment from pharma in digital tools and solutions that promote and deliver value in areas outside of and in addition to basic treatment. With reimbursement in the US and beyond increasingly stemming from the patient experience rather than the product, it’s never been more important.