Paying for health care “value” is intended to achieve several goals. We are aiming to improve quality of care and patient outcomes while reducing low-value spending and high treatment cost. We are making care delivery more patient-centered through shared decision-making, improved patient experience, personalized medicine, and attention to patient-reported functionality and quality of life. We are also creating mechanisms—such as value assessment tools, clinical pathways, and quality measures—that help decision-makers select the highest quality treatment for patients at the lowest cost.
In particular, value assessment tools and frameworks—including those developed by ICER, the American Society of Clinical Oncology, the National Comprehensive Cancer Network, and Memorial Sloan Kettering Cancer Center—are increasingly used by payers as a source of information to guide coverage and payment decisions. These tools evaluate the quality of health outcomes associated with treatment compared to its economic cost.
It is understood that “economic cost” primarily focuses on direct costs of care such as the price of a test or a drug or the cost saved by avoiding an emergency department visit or hospitalization. But how do the indirect benefits related to use of a product or service, including to the patient, caregivers, employers, and society more broadly, fit into the value equation?
The Value of Indirect Benefits
Indirect costs include expenses resulting from the disease morbidity and mortality and can include lost productivity, caregiver burden, or diminished quality of life or functioning. Indirect benefits relate to a treatment’s ability to reduce or avoid those costs.
Recently, authors from the National Pharmaceutical Council have made a strong case for considering indirect benefits in value assessments. In a Health Affairs Blog post, authors Ciarametaro, Buelt, and Dubois argued that including indirect benefits in value assessments can dramatically change determinations of treatment value, and the exclusion of indirect benefits can significantly undervalue therapies, impairing access for patients. In addition, in a Journal of Managed Care Pharmacy article by Karr, Graff, and Westrich, the authors found that including work productivity in value assessments generally increases the estimated value of a treatment.
Ciarametaro and his co-authors note that there is disagreement about which indirect benefits should be included in value assessments. In their article, they recommend establishing clear standards for measuring value, generating data on product-specific indirect benefits, and making payment decisions that reflect what matters most to patients and their families, such as the ability for treatment to improve quality of life or allow patients to return to work.
The Indirect Benefits of Effective Cancer Care
According to a Northeast Business Group on Health report, cancer care accounts for 12% of total medical costs for employers in the US. Despite this huge sum, the indirect costs of cancer—which is a primary cause of short- and long-term disability—actually outweigh the direct costs of cancer ($139 billion indirect costs out of $264 billion total costs). Given these statistics, understanding the indirect benefits of cancer care is essential when considering health care coverage and value-based payment policy. Treatment decisions following a diagnosis may impact a patient’s ability to work in the short-term, which can continue into survivorship. Treatment decisions may also determine other nonmedical costs to the patient, such as whether the patient needs to travel for drug infusion and pay for other services, such as child care. Spouses, partners, family members, friends, and neighbors are also impacted by these decisions. If fewer hours of caregiving are needed, effective treatment may help caregivers avoid work-related difficulties such as a leave of absence, warning about performance or attendance, or job loss.
Despite these considerations, cancer value assessment frameworks focus primarily on direct medical costs (eg, the cost of the treatment) and direct cost offsets (eg, reductions in hospital costs). While ICER includes assessments of productivity from a societal perspective in its analytic framework, it sometimes omits these analyses from its reports. For example, in a 2016 evaluation of non-small cell lung cancer treatment options, ICER acknowledged productivity, transportation, and caregiver costs as potential considerations, but determined that these factors “would be unlikely to have materially affected our findings.” In a second ICER report, the authors cited lack of evidence due to the advanced age and severity of disease as the key reason for not including the indirect benefits of PARP inhibitors for ovarian cancer treatment, despite a commenter’s concern that ovarian cancer can occur for younger patients when they are “immersed in careers, civic engagement, or parenting.” Quantifying the indirect benefits of effective treatment for these working and parenting women is critical to understanding the true value of PARP inhibitors for the younger population.
Other challenges for measuring the indirect benefits of cancer treatments persist:
- Cancer is not a homogenous condition; it is a heterogenous group of conditions that can vary depending on stage and tumor characteristics, such as genetic markers. Small and narrowly defined populations of patients make it challenging to study and understand the impact of indicated treatments on quality and cost.
- There are a wide range of diagnostic and targeted treatment options for cancer that are evolving rapidly, which complicates the ability of value assessments to meaningfully compare indirect benefits. Further, value assessments need to be updated when indications for treatment change, as the materiality of the indirect benefits of a treatment for patients with severe advanced-stage cancer may differ when considering the same treatment for early-stage cancer patients.
- Patients have unique perceptions of value depending on their circumstances. Cancer patients often need to make complex trade-off decisions between treatments that may prolong life but might reduce quality of life vs treatments with fewer toxicities that may not yield the same survival benefit. Patients have individual preferences based on their priorities about treatments that may allow them to continue their routine or avoid travel costs, or that are less burdensome on their caregivers. Therefore, value assessments need to allow for personalized interpretations of what “value” really is.
What Is Still Needed?
Generate Data on Indirect Benefits: The total value of cancer treatments cannot be fully understood without data and evidence to inform an assessment, or to support development of measures of indirect benefits such as increased productivity or reduced caregiver burden. Manufacturers should consider ways to collaborate with patients, employers, payers, and professional societies to determine what measures of indirect costs and benefits should be incorporated into clinical trials and real-world evidence studies. As Ciarametaro and his co-authors note, clear standards for measuring value would facilitate manufacturer investment in these studies.
Develop and Use Patient- and Caregiver-Focused Measures: Measure developers should pursue patient- and caregiver-reported outcome performance measures that assess the impact of care where indirect benefits should be assessed. As we have discussed in prior blogs in this series, it is essential to incorporate the patient perspective into cancer care quality measurement. While patient-reported quality-of-life measures are under development, policymakers have yet to consistently and meaningfully account for the patient perspective in coverage policies and payment programs. For example, broad use of standardized measures of productivity and impact on daily living are needed for both cancer patients and their caregivers.
Ensure Fit-for-Purpose Use of Measures of Indirect Benefits: Those who perform value assessments and public and private policymakers implementing coverage policies and value-based payment programs in oncology should generally consider the indirect benefits of treatment. However, policymakers should also weigh the importance of specific benefits for subpopulations of cancer patients when selecting which measures to use. For example, measures of workplace productivity are not likely to be as meaningful for Medicare coverage policy and value-based payment programs, unless the measures are geared toward the impact of effective treatment on decreasing caregiver burden.
Assessing the indirect benefits of cancer care is critical to understanding the total value of care. Including indirect benefits in value assessments is necessary, as payers, employers, and professionals use these tools to make decisions about coverage, treatment selection, and value-based payment. Manufacturers can contribute by collaborating with patients, professionals, purchasers, and payers to define standards for generating data about indirect benefits that can then be used in value assessments and to develop patient-centered quality measures.
Now that you have read our perspective, what indirect benefits do you think are most important to consider when assessing the value of cancer treatments? How can these benefits be translated into measures for value assessments and value-based payment programs? Tell us your thoughts in the feedback form below.
Read other installments from the Quality Outlook series.
About the Quality Outlook Commentary Series
Breakthrough treatments in cancer care, including precision therapies tailored to specific patient factors, are driving rapid changes in the definitions of oncology quality and value. Efforts to implement value-based care models in oncology must meet the demands of evolving science, new best care practices, and shifting patient priorities. Quality measures must be up-to-date and relevant. Payment models must recognize the challenges and costs of managing complex patient populations with diverse needs. In this JCP blog series, Quality Outlook, Discern Health will explore key issues in oncology quality and value through posts focused on measurement, value-based payment, and quality improvement.
About Tom Valuck, MD, JD
Tom Valuck is a Partner at Discern Health. He is a thought leader on health care system transformation and helps lead the firm’s focus on achieving better health and health care outcomes at a lower cost. Tom’s work at Discern includes facilitating the exploration of next-generation measurement and accountability models for health care delivery systems. He also helps clients develop strategies to achieve success within the value-based marketplace.
About David Blaisdell
David Blaisdell, a Director at Discern Health, leads and manages client projects, providing insight and subject matter expertise, particularly on quality landscape analyses and measure gap identification. David has led and contributed to projects focused on oncology quality measurement to identify key gaps in measures used in accountability programs and opportunities for measure development. Through this experience, David helps clients navigate measurement and value-based payments and define strategies for success.
About Manasi A Tirodkar, PhD, MS
Manasi A Tirodkar is a Director at Discern Health. She brings a wealth of knowledge and experience in health services research, quality measurement, and practice transformation in primary and specialty care settings. Prior to joining Discern, Manasi was a Lead Research Scientist at the National Committee for Quality Assurance (NCQA) for more than 10 years. At NCQA, she led measure development projects spanning various disease conditions and populations, including oncology.
About Discern Health
Discern Health is a consulting firm that works with clients across the private and public sectors to improve health and health care through quality-based payment and delivery models. These models align performance with incentives by rewarding doctors, hospitals, suppliers, and patients for working together to improve health care while lowering total costs.