Panelists Debate the Role of ICER: Useful Overseer of Prices, or Oppressor of Choice?

This story has been updated to correct the number of ICER reports and a quote in the third paragraph.

Unlike the United Kingdom, or certain other European nations, the United States does not have a central watchdog that decides which therapies the government will or will not cover. In recent years, however, the Institute for Clinical and Economic Review (ICER) has gained prominence for issuing reports that seek to change the ways in which new prescription drugs are evaluated and priced, and their work is backed by funding from the Laura and John Arnold Foundation. Their work over the past dozen years or so has seen a jump in the number of reports they issue; perhaps not unsurprisingly, this has coincided with an increase in the number of high-cost therapies to treat cancer, rare diseases, and chronic diseases such as asthma and diabetes.

ICER issued 11 reports last year, up from 1 report in 2007, moderator Denise Kruzikas, PhD, MPH, a vice president at the market access firm AESARA, told an audience attending a panel called "The Rise of ICER Means the Loss of Choice: True, False or Uncertain?" during the ISPOR 2019 annual meeting.

“Why are we really here?” Kruzikas asked rhetorically. “At the end of every decision is a person,” she said, "and how a product is priced, how it is assessed, and whether it affects access, matters.”

The panel was structured as a bit of a debate, with Robert W. Dubois, MD, PhD, the chief science officer and executive vice president of the National Pharmaceutical Council, kicking things off with, as he put it, “laying all his cards on the table.” ICER does represent the loss of choice, he said, citing 3 assumptions and 5 assertions to back up his claim.

The growth of ICER and health technology assessment (HTA) reports assumes that a cost/quality-adjusted life-years (QALYs) analysis has been performed, and secondly, that an economic threshold has been decided upon (for example, $150,000/QALY).

The third assumption is that decisions are being made based upon those factors, Dubois said, citing such developments as CVS deciding to use ICER reports in its coverage decisions and the Medicaid program in New York taking these assessments into account in coverage of a $272,000 cystic fibrosis drug which may only achieve modest gains.

The 5 assertions one would have to believe, he said, is that the QALY is an appropriate and accurate measure; the analysis is correct; there is an agreed-upon threshold; stakeholders have a concensus around the value of a specific treatment for a specific patient; and society is willing to favor the concept of “fairness” over “choice.”

Dubois made it clear he believed none of these things—for example, when it comes to the accuracy of QALY as a metric, he said, “we could have a whole conference on this topic and still not agree.”

The second assumption, that the analysis is correct, assumes that the point estimate says the price should be a set amount with little variability.

He also disagreed with the idea of agreed-upon thresholds, which would require that “Moses came down from the mountain,” to issue a decree and everyone agrees. “There hasn’t been a plebiscite where we voted on this.”

Additionally, agreeing upon the idea of uniformity about the value of a specific treatment would require everyone to have the same preferences.

Lastly, Dubois said that if people in the United States were to value fairness over choice, it would mean “we deem a drug too expensive, we’re not paying for it, but it applies to everybody.” That is the culture in Europe, but here we value choice, he claimed.

Michael Sherman, MD, MBA, MS, the chief medical officer and senior vice president of Harvard Pilgrim Health Care, and Ron Akehurst, DSc, Hon MFPHM, emeritus professor of health economics at the School of Health and Related Research at the University of Sheffield and chairman of BresMed Health Solutions, provided 2 counterpoints to Dubois.

“I do believe that ICER is informing decisions,” said Sherman. When staff in his own organization discuss these issues, and find a coverage decision is difficult to make, they often reframe it as, what would they do if the patient was a member of their own family?

Sherman cited 6 reasons for not believing that the rise of ICER means the end of choice. The first, he said, is that the United States lacks an official HTA group; secondly, there is a need for an objective third party that is neither a payer or manufacturer.

The third reason is that, without frameworks, payers may react to price alone. For the fourth reason, he said, is that, with or without ICER, payers have always set preferred drugs, and will continue to do so.

For the fifth reason, Sherman noted that there are fewer administrative hassles when pricing is aligned with ICER; and lastly, he claimed that, when there is high cost, low value, and unmet need, ICER does not enable health plans to deny access.

As both a payer and provider, Harvard Pilgrim will read these analyses regardless, Sherman said. In addition, as physicians take on more risk, they care about this information as well.

“It helps me look at drugs in the context of not ‘what is the price tag?’ but what do you get for your money,” he said.

In addition, he reminded the audience that those in the room “are accountable for the total cost of care.” Health plans have used ICER’s information to negotiate prices, he said.

Moreover, he said, if organizations do not act themselves, action on pricing will be done for them, referencing the Trump administration’s proposal to set an international price index to try and force downward pricing pressure.

With that, Akehurst, the next panelist, referenced his UK citizenship as he opened with, “You’re probably wondering what I’m doing here, an outsider. This is an American spat.” But he brought the perspective of countries with a fixed budget, single-payer healthcare system, cognizant of opportunity cost and cost/utility comparisons, which doesn’t work well when applied to the United States.

For the parts of US healthcare where those methods could apply, namely Medicare, Medicaid, and care for veterans, cost/utility has been ruled out, he said. HTA is difficult to apply consistently, even in places like the United Kingdom, he said.

The United Kingdom has a longer history with these assessments, though. Akehurst cited a precursor to the National Institute of Health and Clinical Excellence (NICE) and suggested there might be some possible parallels with ICER.

Akehurst also recalled a previous earlier effort to train physicians in the concept of QALY; he gave them a national budget to allocate, and they had to justify their decisions. “Every single one of the groups looked at survival and quality of life,” he said; the physicians became converts to the QALY cooncept.

Kruzikas asked both Sherman and Akehurst to respond to some of Dubois’ points.

One issue that has been raised in his institution, Sherman said, is whether or not certain classes of patients, such as those with neurological diseases, are discriminated against.

“I don’t know what the right threshold is," he said. But the fact that there is no agreement doesn’t mean that the threshold is unlimited, he said.

“The Brits actually get this,” Sherman said, while “we pretend it’s an unlimited budget.” And, he said, choices are already made when decision makers choose whether to spend money on education, infrastructure, or wages instead of healthcare.

“I think the QALY just has to be better than anything else you might use,” Akehurst said. It does have to be correct, he said, but he also asserted that “the more it is used, the better it will get.”

Referring to Dubois’ positioning of the issue as one of fairness versus choice, Akehurst said that for him, when he hears that framing he thinks, “Fairness over choice? I suppose the fundamental question I’ve got here is loss of choice by whom, and which choices? There are a whole variety of choices.”

For his part, Dubois said, “I am not against cost effectiveness analysis. I just want us to adopt the adult implications,” referring to tradeoffs.

For him to accept ICER’s focus on drugs, he said improvements are necessary. He opposes the attention on pharma, as opposed to the healthcare system as a whole, and said the review process is a “black box.”