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Enabling outcomes-based contracts for payers

Cell and gene therapies (CGT) have the potential to be truly transformative. There’s great urgency for patients to have access to these ultra-high-cost CGTs. As more therapies come to market, health plans will be challenged with how to provide access to members.


Outcomes-based contracts

When implementing outcomes-based contracts for CGTs themselves, health plans and life science manufacturers face challenges. Erin Hulbert, director of value-based services at Optum, and Mari-Pat Kalla, senior product director, talk about these issues. They also discuss how Optum is putting new theories into practice to enable outcomes-based contracts and ease challenges.

Erin Hulbert: What roadblocks exist today for health plans when implementing outcomes-based contracting programs?

Mari-Pat Kalla: The challenges health plans face when implementing outcomes-based contracts vary by the size of the plan. Smaller health plans have limited experience with outcomes-based contracts today. They’re often challenged by not knowing where to start. They often don’t have the resources or bandwidth to take this kind of initiative on.

Larger health plans recognize the need to follow patient outcomes in a health plan-agnostic and provider-agnostic way. Their challenges of outcomes-based contracting today centers around two key areas. First, identifying and aligning with manufacturers on meaningful and measurable real-world outcomes around which to share risk.

Second, having the infrastructure, analytic resources and expertise to follow the patient cohesively and objectively over the necessary time frames to understand patient response. This is particularly important for understanding the performance of gene and cell therapies.

As a result, many health plans report that outcomes-based programs are often watered down to meet limitations around available data and/or analytics capabilities. This results in programs that fall short of delivering necessary insight to share and manage risk.

From discussions we’ve had, health plans of all sizes are in agreement that outcomes-based contracting strategies are needed to manage the emerging pipeline of gene and cell therapies. They are also wary of and challenged by each manufacturer taking its own approach to data collection methods and aggregation. They foresee it to be a lot to manage.

CGT contract challenges

EH: Can you elaborate on the particular challenges health plans anticipate with outcomes-based contracts for gene therapies?

MPK: Health plans have noted it’s challenging to send data to a third party they don’t already have a relationship with. Sharing data with a new vendor obviously requires security reviews, quality control measures and business associate agreements that take time and resources to establish and maintain. Both parties need to have trust in the data.

There can be a perceived imbalance when a manufacturer proposes an alternative, such as they will track patient outcomes themselves and report back to the health plan. It’s this type of detail that everyone agrees upon in principle but falls apart when pen hits paper.

Where to start

EH: Many of these issues seem too big for any one party to solve on their own. Where can we start?

MPK: The answer starts with the role Optum can play to connect the health care system. Let’s revisit some of those hurdles: measuring clinical outcomes, tracking those outcomes over time and instilling confidence in measurement and reporting. We have a solution that addresses all three.

The patient journey analytics in our Outcomes-Based Contract Enablement solution can be used to measure outcomes for specific outcomes-based contracts. While some patient outcomes can be measured with claims data from the solution alone, others require us to collect medical records from providers to gather additional information.

This is where the scale of the Optum risk and quality organization comes into play. Optum currently collects more than 18 million charts per year from providers on behalf of health plans to support clinical and risk assessment services. We tap into this infrastructure to collect the necessary charts and abstract relevant information to support outcomes measurement when claims alone are insufficient.

Because Optum currently serves over 100 health plan clients, we can leverage our existing data streams and business relationships. This enables us to create a solution that provides foundational data and analytics to empower Outcomes-Based Contract Enablement and track patients over time across health plans without requiring data to be sent anywhere new.

We already have the scale needed to do this. Health plans eligible to participate in Optum® Outcomes-Based Contracting Enablement — those whose claims data are already running through our existing pipes — currently represent more than half of the commercial, Medicaid and Medicare lives in the U.S.

We’re relying on our unique position in the health care ecosystem to provide access, expertise and scale necessary to enable Outcomes-Based Contract Enablement.

Optum is already a trusted partner to health plans that can leverage their existing investment and relationship with Optum. This includes data streams, security, quality control and business associate agreements enabling the data and analytics to support their outcomes-based contracting initiatives.

In this way, health plans have a single point of contact with which to work. They don’t have to manage unique data aggregation processes for each therapy or have to set up new data processes with a number of different third parties.

We can provide a solution to both health plans and manufacturers that supports:

  • Longitude patient-level tracking
  • Clinical and claims-based outcomes measurement
  • An auditable process to support financial reconciliation, where all parties can have trust in the data

Putting it into practice

EH: What does this look like in practice?

MPK: Optum Outcomes-Based Contract Enablement is organized by therapeutic programs, for example, hemophilia, sickle cell disease, spinal muscular atrophy.

Members across participating plans who meet criteria for the therapeutic program are assigned a global ID. This allows us to cohesively and objectively follow individual patient journeys across the health care system in a provider-agnostic, health plan-agnostic way.

As individuals move from health plan to health plan or provider to provider, we can link the appropriate claims data to follow them longitudinally. Health plans are challenged to do this on their own given that members may move from one plan to another.

We’ve worked diligently to identify key therapeutic programs based on the pipeline of new therapies coming to market. We also seek input from our health plan clients on which therapeutic areas are most important to them.

Coming together to do well

EH: How do we, collectively as health plans, life science manufacturers and Optum, come together to do this well?

The promise that gene and cell therapies hold for patients is real. We’d love to talk to others to share ideas or find ways to partner with life science manufacturers and health plans in this space.

We are excited to work together to ensure that members have affordable access to transformative therapies. Together we can reshape health care for the good of all as we continue to innovate and connect disparate parts of the health system.

Optum is committed to providing solutions that support both life science manufacturers and the health plan community in getting the right treatments to the right patients at the right time — to meaningfully and measurably improve clinical outcomes and quality of life for patients.

About the authors

Erin Hulbert, MS
Director, Value-Based Services, Optum

Erin Hulbert leads the Value-Based Services (VBC) team, supporting health and economic outcomes analysis to measure value in the health care system. Hulbert joined Optum in 2010 and was previously a member of the Health Economics and Outcomes Research (HEOR) team. She has experience in conducting RWE outcomes analysis and research using observational and prospective methodologies. She has worked with administrative claims, clinical data, medical charts, surveys and clinical trials across a variety of therapeutic areas. Her work has been published in peer-reviewed journals, such as the Journal of Managed Care Specialty Pharmacy and American Journal of Pharmacy Benefits.

Mari-Pat Kalla
Senior Product Director, Optum

Mari-Pat has been leading product innovation in the clinical development, scientific consulting and outcomes-based contract enablement space for the past five years.

Prior to joining Optum, Mari-Pat spent 15 years in new product marketing, market development and portfolio management roles in the medtech and biotech industries. She has a bachelor’s degree in chemical engineering from the University of Minnesota and an MBA from The Anderson School at UCLA.