Prepare now; the wave is coming
As long as the focus remains on rare and ultra-rare diseases, gene and cell therapies won’t bankrupt health insurers, Patrick Fortune, vice president of market sectors at Partners HealthCare, a not-for-profit healthcare system based in Boston, told HRI. “Over time, however, I think the aperture for gene and cell therapies will expand to larger patient populations, as we’ve seen in other therapeutic areas,” Fortune said. Creating access and reimbursement models now, while the patient populations are small, will be critical to successfully scaling up these programs as more patients become eligible for expensive new treatments, he said.[xxvii]
Providers, too, might need help financing gene therapy. Providers are a critical part of the gene therapy supply chain, collecting the cells from patients, properly packing them to be shipped off-campus to a processing facility and then, once the cells return, reintroducing them into the patients.
So far, the costs are high and reimbursement is uncertain. Under Medicare Part B, typically, providers purchase drugs and are reimbursed after the drugs have been administered, a process known as “buy and bill.”[xxviii] But buying now and waiting to be paid back later, perhaps at a loss, is a different story when the treatment’s price tag is more than $1 million.
Providers may seek assurance or financing help from pharmaceutical companies or payers to offset financial risks associated with being part of the supply chain. But these deals will have to be carefully constructed to avoid being viewed as kickbacks.
Consumer finance is a patient experience opportunity
The billing and payment experience can help or harm an organization’s reputation with consumers.[xxix] Data, along with consumer segmentation, can help determine what sorts of financing tools patients might need, or be most likely to use, and create positive experiences long after discharge, after the explanation of benefits is mailed or after the prescription is filled at the local pharmacy.
Research conducted by HRI concluded that consumer segments valued different features related to payment and billing, with, say, millennials much more likely to ask providers for discounts on the price of a visit, and more affluent patients much less interested in using retail pharmacy apps.[xxx] Healthcare organizations that carefully segment their consumer populations and learn their preferences may be able to turn a pain point — billing and payment — into a positive experience that leads to return visits and good word-of-mouth.
GoodRx has found traction using technology making it easier for consumers to shop for drugs and compare prices, said Thomas Goetz, the company’s chief of research. “It’s understanding what actually matters to people,” Goetz told healthcare executives at PwC’s 180 Health Forum in 2019. “It’s understanding how people will actually use these technologies. … What does the user want? That’s a principle of technology that other industries use as a matter of course. Serve your user. We’re only starting to do it in healthcare.”[xxxi]
Establish a value line
Having a line of product and service options at different price points for customers is a smart growth strategy in a healthcare ecosystem in which average deductibles have tripled over the past decade, making healthcare costs a difficult financial decision even for the insured. Rather than building their own value lines, traditional health companies should consider acquiring or partnering with firms that have figured out how to deliver value to the uninsured and underinsured and turn a profit.[xxxii]
Recently, Walmart launched its first stand-alone Walmart Health center in Georgia, where customers can find primary care, dental care, mental health services and imaging services as well as access to wellness services through Walmart’s partnerships with community health organizations.[xxxiii] The company also started offering 44 generic prescription drugs in four therapeutic categories for just $4 each for a 30-day supply.[xxxiv]