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Clinical Pathways GPS

Addressing High Drug Costs: Integrating Value Assessment Principles Into Clinical Pathways

Authored by

Richard G Stefanacci, DO, MGH, MBA, AGSF, CMD—Column Editor; Matthew Pakizegee, PharmD, MS


The Access Group, now part of EVERSANA™, Berkeley Heights, NJ


Dr Stefanacci is the chief medical officer for The Access Group, a managed markets agency for pharmaceutical companies, now part of EVERSANA™. Dr Pakizegee is the clinical content lead for Government Policy Systems at EVERSANA™.


J Clin Pathways. 2018;4(8):29-30. doi:10.25270/jcp.2018.10.00040

The high cost of prescription medications is a common topic of debate in oncology care and in mainstream news. Many ideas on how to reduce drug prices have been proposed and debated, but stakeholders are not close to coming to a consensus. Some companies, such as CVS Health, have moved forward in enacting their own plans aiming to bring the costs of therapies down. But the implementation of plans that do not consider a wide variety of factors in value assessment risks limiting treatments to patients in need. Clinical pathways offer a possible solution to the issue of therapy value assessment.

CVS Health and the New York State Board responsible for Medicaid both launched programs restricting access to high-priced medications based on cost-effectiveness estimates from the Institute for Clinical and Economic Review (ICER).1 These programs aim to constrain drug launch prices and drive the movement toward evidence-based pricing. 

Specifically, CVS announced a new formulary management option, which allows self-insured employers to remove from their formularies medicines launched at a price greater than $100,000 per quality-adjusted life-year (QALY).2 And the New York State Drug Utilization Review Board has recently used a cost-effectiveness threshold to justify its mandate for the Medicaid program to receive a steep discount on the price of a cystic fibrosis treatment.3 If the discount is not obtained, access to the drug will likely be limited. 

It is important to follow these developments, as future clinical pathways may follow a similar lead in providing cost-effective treatment options based on QALY, with some therapies not being included. For example, in the case of the New York State Board, a clinical pathway for Medicaid providers managing cystic fibrosis would require alternative treatments. This type of exclusion, based solely on ICER cost-effectiveness estimates, is discussed by Robert W Dubois in Health Affairs as being “too much too soon,” as this approach could hamper patients’ access to needed medicines.1 We concur with Dr Dubois and add our perspective on the topic, particularly as this debate relates to clinical pathways. 

The Problem With Arbitrary Treatment Limits

With this move, CVS assumes that the field of value frameworks is fully mature and has worked out the many limitations and nuances of QALY, but this is not the case.4 Presently, there is no commonly agreed-upon value or method for determining cost-effectiveness thresholds.5 Studies surveying clinicians and experts in the field have shown average thresholds up to $300,000 per QALY.6 To fully assess the value of a treatment, stakeholders must account for other considerations important to patients. These other considerations should include: “a new therapy’s ability to treat a previously inadequately treated illness; its ability to broaden therapeutic options for diseases with great variability in treatment response; the possibility of cure and the importance of hope related to it; the ease of a regimen when alternative therapies are complex, cumbersome, and time consuming; or, its novel mechanism of action that could lead to markedly improved derivative treatments.”1 

There are inherent problems when using cost effectiveness as the sole exclusion criteria. Dr Dubois points out that cost effectiveness is an element of value, but it is not synonymous with it.1 The National Health Service (NHS) in the United Kingdom bases many of its coverage decisions on the National Institute for Health and Care Excellence’s cost-effectiveness assessments,7 yet they incorporate other considerations as well. Multiple groups in the United States, such as the ICER,8 the American Society of Clinical Oncology,9 the National Comprehensive Cancer Network,10 the Innovation and Value Initiative,11 and Faster Cures,12 among others, have proposed value assessment frameworks—none use cost-effectiveness as the sole measure of value. 

The Second Panel on Cost-Effectiveness in Health and Medicine provides the latest overview of how these assessments should be performed and emphasizes the importance of considering not just the health system perspective but also the broader societal one.13 The CVS program uses a single threshold of $100,000 per QALY and is unlikely to integrate a health system perspective that incorporates the economic value of improvements such as productivity or reductions in caregiver burden. As Dr. Dubois rightly asserts, “Evaluating all therapies for all diseases under all circumstances with a single threshold is an inappropriately blunt approach.”1 Using a single cost-effectiveness number presupposes that all patients respond in the same fashion to a therapy, but there is substantial literature demonstrating that some patients benefit far more than the average with the same treatment.14 


Value-Based Clinical Pathways

An alternative to this all-or-none approach that CVS Health is taking is to make very specific recommendations regarding the “right” patient for these costly medications to achieve the “best” clinical and financial outcomes.

In a separate Health Affairs piece last year, authors identified 6 key considerations for the improvement of value frameworks 15:

  1. Value assessments should be separate from assessments of budget impact and affordability.
  2. Value assessments should incorporate what is important to patients, even if the end user for a framework is the payer.
  3. Value assessments should adopt broad system perspectives in what they assess and how they assess it.
  4. Value is dynamic and needs to be considered and captured as such.
  5. Value assessments should be transparent and reproducible.
  6. A diversity of value assessment approaches that reflect the differing needs of stakeholders should remain; value assessments should reflect user preferences. 

These considerations can be integrated into clinical pathways by including clinicians, patients, advocacy groups, caregivers, and employers in the clinical pathway process as vital stakeholders and by taking clinician preferences into consideration when implementing pathways. Clinicians should have some opportunities to make decisions based on their clinical judgement after evaluating each patient.

Although pathway developers can decide which treatment to include on a clinical pathway based on the safety and efficacy of the treatment, assessment of the value of that treatment ultimately lies with the patient. Patient definitions of value specific to each disease state will be an important component to enhancing current value-based care models. Discussions between a clinician and patient are often the best way to determine how they value treatment goals, symptomatic management, procedures, and adverse drug effects. 

Although a budget impact model does not traditionally look at an employee’s productivity or caregiver burden, a value assessment should take these into consideration to understand the full context of the added benefit of a new therapy. Budget impact traditionally views cost in a 1-year horizon in the United States, while incremental cost-effectiveness ratios used in health technology assessments outside the United States focus on differences between treatments. Restricting coverage based on both US and ex-US models may ultimately hurt patients in terms of treatment options they have available. Clinical pathways should avoid burdening patients with additional hurdles to access therapies that address their individual needs and disease states.

One-size does not fit all, and allowing patient variability is important for subpopulations that may have more clinical benefit from what a clinical pathway may ascribe to the “average patient.” Approaching pathways with clinical attributes of the “average patient” may threaten the health care system’s shift toward personalized medicine. Clinical pathway developers must ask themselves if the “average patient” actually exists when developing pathways.


Clinical pathways can use these principles for assessing value or, instead, be forced to develop pathways with a limited array of treatment options set arbitrarily as in the case above. This is an ideal opportunity for clinical pathways to assume a leadership position in pursuit of value-based pharmaceutical outcomes—an area that is sure to get more complex and, as a result, need clear guidance or pathway.


1. Dubois RW. CVS to restrict patient access using cost-effectiveness: too much too soon. Health Affairs. Published September 17, 2018. Accessed October 2, 2018.

2. CVS Health, CVS Health Enterprise Analytics. Current and New Approaches to Making Drugs More Affordable. Published August 2018. Accessed October 2, 2018.

3. Thomas K. A drug costs $272,000 a year. Not so fast, says New York state. New York Times. Published June 24, 2018. Accessed October 2, 2018.

4. National Pharmaceutical Council (NPC). Guiding practices for patient-centered value assessment. website. Accessed October 2, 2018.

5. Bertram MY, Lauer JA, De Jonsheere K, et al. Cost-effectiveness thresholds: pros and cons. Bull World Health Organ. 2016;94(12):925-930.

6. Nadler E, Eckert B, Neumann PJ. Do oncologists believe new cancer drugs offer good value? Oncologist. 2006;11(2):90-95.

7. National Institute for Health and Care Excellence (NICE) What we do. website. Accessed October 2, 2018.

8. Institute for Clinical and Exonomic Review (ICER). ICER Value Assessment Framework. website. Accessed October 2, 2018.

9. Schnipper LE, Davidson NE, Wollins DS, et al. Updating the American Society of Clinical Oncology value framework: revisions and reflections in response to comments received. J Clin Oncol. 2016;34(24):2925-2934.

10 National Comprehensive Cancer Network (NCCN). NCCN Clinical Practice Guidelines in Oncology (NCCN Guidelines) with NCCN Evidence Blocks. Accessed October 2, 2018.

11. Innovation and Value Initiative (IVI). Open-Source Value Project, Transforming the Process of Value Assessment. website. Accessed October 2, 2018.

12. Milken Institute, Faster Cures. Patient Perspective Value Framework. website. Accessed October 2, 2018.

13. Neumann PJ, Ganiats TG, Russell LB, Sanders GD, Siegel JE, eds. Cost-Effectiveness in Health and Medicine. Oxford, UK: Oxford University Press; 2016. 

14 Graff JS, Grasela T, Meltzer DO, Dubois RW. Individual treatment effects: implications for research, clinical practice, and policy. Am J Manag Care. 2014;20(7):544-551.

15. Dubois RW, Westrich K Value assessment frameworks: how can they meet the challenge? Health Affairs. Published March 2, 2017. Accessed October 2, 2018.

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