Performance-Based Contracting in Oncology

In the non-oncology drug space, pharmacy benefit managers have become a lot more aggressive; however, it remains to be seen whether or not the same will eventually happen in the oncology space, said John L. Fox, MD, MHA.

He added that while the panelists had discussed accountability among providers for cost and outcomes, they hadn’t yet touched upon the issue of accountability among manufacturers of drugs, devices, or diagnostics.

“I think it’s an emerging area of interest,” he said. “We have a contract with a manufacturer that says if their drug doesn't achieve the progression free survival that they found in their clinical trial, that there will be a reimbursement to the plan.”

What Priority Health is doing in that instance differs from holding companies accountable for a patient-by-patient basis to see if the drugs are performing, pointed out Scott Gottlieb, MD. Instead, Priority is holding manufacturers accountable on a global scale to demonstrate post-market what they found in the clinical trial.

Ted Okon added that there have been talks between manufacturers and CMS to consider these agreements, and there seems to be some agreement on both sides that this may be worth pursuing. However, there are structural impediments in the Medicare system that may mean CMS cannot just issue new regulations, but new legislation may need to be drafted.

“I think the challenge in all of this though is: do we have the data to adjudicate a pay-for-outcomes contract,” said Dr Fox.