AMCP Partnership Forum: Advancing Value-Based Contracting

During the past decade, payment models for the delivery of health care have undergone a dramatic shift from focusing on volume to focusing on value. This shift began with the Affordable Care Act and was reinforced by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), which increased the emphasis on payment for delivery of quality care. Today, value-based care is a primary strategy for improving patient care while managing costs. This shift in payment models is expanding beyond the delivery of health care services to encompass models of compensation between payers and biopharmaceutical manufacturers. Value-based contracts (VBCs) have emerged as a mechanism that payers may use to better align their contracting structures with broader changes in the health care system. While pharmaceuticals represent a small share of total health care spending, it is one of the fastest-growing segments of the health care marketplace, and the increasing costs of pharmaceuticals necessitate more flexibility to contract in new ways based on the value of these products. Although not all products or services are appropriate for these types of contracts, VBCs could be a part of the solution to address increasing drug prices and overall drug spending. VBCs encompass a variety of different contracting strategies for biopharmaceutical products that do not base payment rates on volume. These contracts instead may include payment on the achievement of specific goals in a predetermined patient population and offer innovative solutions for quantifying and rewarding positive outcomes or otherwise reducing payer risk associated with pharmaceutical costs. To engage national stakeholders in a discussion of current practices, barriers, and potential benefits of VBCs, the Academy of Managed Care Pharmacy (AMCP) convened a Partnership Forum on Advancing Value-Based Contracting in Arlington, Virginia, on June 20-21, 2017. The goals of the VBC forum were as follows: (a) agree to a definition of a VBC for facilitating discussion with key policy makers and regulators; (b) determine strategies for advancing the development and utilization of performance benchmarks; (c) identify best practices in evaluating, implementing, and monitoring VBCs; and (d) develop action plans to mitigate legal and regulatory barriers to VBCs. More than 30 national and regional health care leaders representing health plans, integrated delivery systems, pharmacy benefit managers, employers, data and analytics companies, and biopharmaceutical companies participated. Speakers, panelists, and stakeholders attended the forum and explored the current environment for VBCs, identified challenges to the expansion of VBCs, offered potential solutions to those challenges, and developed an action plan for addressing selected challenges. The forum recommendations will be used by AMCP to establish a coalition of organizations to seek broader acceptance of VBCs in the marketplace and by policymakers. The recommendations will also help AMCP provide tools and resources to stakeholders in managing VBCs.

This Partnership Forum was supported by Amgen, Bristol-Myers Squibb, Eli Lilly, Merck, the National Pharmaceutical Council, Novo Nordisk, Premier, the Pharmaceutical Research and Manufacturers of America, RxAnte, Takeda, and Xcenda.