Principles of Intellectual Property Introductory materials
Market Access in the US (Part 1)
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Stakeholders
Payers – committed to purchase health for the society
Buyer – committed to improve the patient’s health
Consumer – aims to maximize their own care
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Paye
Insurance Provide
Consume
Patient
Buye
Physician
The US healthcare sector is a multi-payer system. It is composed of both public and private financing sources.
Public health insurance schemes are operated by the Centers Medicare, Medicaid, and the for Medicare & Medicaid Services (CMS), such as Children’s Health Insurance Program (CHIP), which are financed primarily by government taxes.
Private financing sources consist of private health insurance plans and OOP payments by individuals who are not insured via a public or private plan.
Healthcare provisions and reimbursement for military members or ex-servicemen are independently managed by either the Department of Defense (DoD) or the Department of Veterans’ Affairs (DVA).
Overview of Healthcare System, US
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Healthcare System, Structure and Flow of Funds, US, 2018
The Department of Health and Human Services (HHS) is the chief organization responsible for regulating the healthcare system in the US.
Along with a certain level of self-governance, each state has its own Department of Health (DoH) to implement state-level health policies.
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US National Pricing and Reimbursement Decision Makers
Federal Government
The Centers for Medicare and Medicaid Services (CMS)
Medicare
Medicaid
Private Insurance Providers
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Both public and private insurance are national stakeholders in the US
Level Stakeholder Roles and responsibilities
National Food and Drug Administration (FDA) Federal agency responsible for executing the regulatory process for drug approval
Makes decisions on whether to approve new drugs and indications
Determines the language of the label for new drugs and indications which can be used by payers to limit physician prescribing
Private insurance (national) Managed care organizations (MCOs) with national reach providing hospital and/or prescription drug benefits, also administer Medicare Parts C and D and Medicaid for some states
Make coverage decisions and set restrictions on drugs
Define patient cost-sharing schemes for different plans offered
Medicare
(part of CMS) Federal program providing health insurance to US citizens ages 65 and over, as well as some groups of disabled individuals
Consists of four parts which cover hospital inpatient care (Part A), hospital outpatient care (Part B), prescription drugs (Part D), or a combination of all three types of coverage (Part C / Medicare Advantage)
Makes coverage determinations that are effective nationally
Medicaid
(part of CMS) Federal program providing health insurance to poor individuals, families, and children
Program supports patients who are “dual-eligibles” for both Medicare and Medicaid coverage
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Regional and local stakeholders have significant autonomy in making coverage decisions
Level Stakeholder Roles and responsibilities
Regional Medicare contractors
(MACs) Responsible for administration of Medicare Parts A and B (medical benefits) at the regional level, across 10 different regions
May make coverage decisions as long as they do not conflict with legal coverage obligations or national coverage decisions made by Medicare
State Medicaid programs Set coverage policies for hospital and pharmacy benefits for members
Must adhere to national guidelines but have considerable discretion
May be managed by private insurers (national or regional)
Regional private insurance Similar to national private insurance but operating on a regional level
Make coverage decisions and set restrictions on drugs
Define patient cost sharing schemes for different plans offered
Local:
Hospital Pharmacists Negotiate prices and access directly with manufacturers or engage “Group Purchasing Organizations (GPOs)” to acquire drugs
Participate in local formulary committees to decide what drugs are to be made available and what restrictions on use will be applied
Local:
Retail Office-based physician practices Acquire physician-administered drugs and file for reimbursement with insurers
Make prescribing decisions which may be influenced by practice economics
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Health Technology Assessment Agencies
HTAs in the US conduct evidence-based assessments or grade the evidence levels for interventions
AHRQ = Agency for Healthcare Research And Quality
MEDCAC = Medicare Evidence Development and Coverage Advisory Committee
DERP = Drug Effectiveness Review Project
PBMSHG = VA Pharmacy Benefits Management Strategic Healthcare Group
PEC = Department of Defense Pharmacoeconomic Cente
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Overview of the System
Health care is provided by
Medicare (65 years or older and people under 65 years with certain disabilities, and people with end stage renal disease)
Composed of four parts:
Part A = Inpatient care
Part B = Ambulatory and preventative care
Part C = Medicare Advantage (Parts A and B provided by a private insurer)
Part D = Prescription drugs
Medicaid and Children’s Health Insurance Programme (CHIP)
Joint federal state initiative that covers low-income citizens or families, legal residents, people with disabilities and elderly individuals needing nursing home care
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Overview of the System
Health care is provided by
Private health plans
Managed care plans: beneficiaries have to seek care from an approved network of physicians and hospitals
Fee-for-service: offers coverage for a range of pre-specified medical services
High-deductible plans
Military Coverage
Veterans Administration (VA)
TRICARE; regionally managed federal healthcare program that is available for active duty and retired members of the uniformed services
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Employer-sponsored private insurance is the dominant insurance coverage type in the US
https:
usafacts.org/articles/health-insurance-data-2019
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Taxes and monthly premiums together comprise the majority of healthcare funding in the US
Healthcare delivery
Medicare
Private insurance
Federal Budget
State Budgets
Healthcare Providers
Patients
Employers
Subsidies
Taxes
Copayments / Coinsurance
Premiums
Financial flowchart of the US healthcare system
Employer-sponsored private insurance is typically jointly funded by the employer and the employee
Medicare coverage is financed by taxation and premiums paid by the insured individuals
Medicaid is funded by states directly as well as federal subsidies provided to the states which represent at least a dollar for dollar matching contribution
Healthcare providers are responsible for collection of patient copayments and coinsurance
Medicare payments to providers are set legislatively and have been repeatedly threatened to be reduced in policy discussions
Medicaid
Premiums
Taxes
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Prescription drug expenditures make up about 10% of all costs
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Private insurers, Medicare Part D, and out of pocket payments together represent the majority of prescription drug spending
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Total US expenditure on prescription drugs estimated to be $249.9 billion
Private insurance represents the largest expenditure on prescription drugs
However, in relation to the percent of covered lives, prescription drug spending by Medicare Part D is highe
Out-of-pocket payments represents copays and coinsurance as well as purchases of non-covered medications
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Reimbursement Process
There is no central reimbursement policy in the United States
Reimbursement is decided at federal, state, and private-payer levels using separate and distinct decision criteria
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Reimbursement Process
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Private Payers
Use formularies managed by the Pharmacy and Therapeutic Committees
Medicare
All hospital inpatient drugs approved by the FDA and included in the USP are fully reimbursed
Few outpatient drugs (requiring administration by a physician, oral anti-cancer drugs) are reimbursed
Medicaid
State provide coverage for all FDA-approved prescription-only medicine
Use evidence-based assessments, considering the cost and expected use of the drug
In Part D, outpatient drugs are reimbursed by private health insurers
Agreements
Manufacturers must agree to rebates, enroll in the federal 340B prescription drug programme and have their products listed on the federal supply schedule
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Principles of Intellectual Property Introductory materials
Market Access in the UK
Stakeholders in the UK
Department of Health – national pricing and reimbursement decision maker.
The NHS model applies throughout the UK, but Northern Ireland, Scotland, and Wales have devolved healthcare systems with local administrations
Regional HTAs provide guidance on the cost-effectiveness
NICE – covers England and Wales
SMC – covers Scotland
AWSMG – covers Wales
Wake Forest School of Medicine
Overview of the System
Healthcare in the UK is publicly funded through taxation, and free healthcare is provided through the national health system, NHS.
Health insurance is not required, and most patients are exempt from co-payments.
The UK Department of Health has overall responsibility for healthcare provision in the UK. Block grants are provided to the devolved administrations, which then set their own health budgets and determine spending while funding in England is allocated directly.
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Overview of the System
ENGLAND NORTHERN IRELAND SCOTLAND WALES
The Department of Health and Social Care (DHSC) is responsible for healthcare planning and provides funds to NHS England and Public Health England, which is responsible for Local Authorities (LAs).
NHS England allocates funding to 211 Clinical Commissioning Groups (CCGs) for the provision of healthcare to NHS Trusts, Foundation Trusts, and Primary Care. NHS England also commissions other specialized services.
CCGs and the LAs receive advice and guidance from NICE. Department of Health and Social Services and Public Safety is responsible for healthcare planning and provision. It is supported by the Public Health Agency on public health matters.
The Health and Social Care Board (HSCB) receives assistance from five Local Commissioning Groups (LCGs) for the provision of healthcare services to the 5 Health and Social Care Trust and the Ambulance Trust.
The HSCB considers guidance and advice from NICE. The Scottish Government Health and Social Care Directorate is responsible for healthcare planning and provision. It is supported by NHS Scotland.
14 NHS Boards for hospitals
Local Authorities and seven Special Health Boards for general practitioners (GPs,) dentists, community, pharmacists, and so on.
NHS Boards are overlooked by organizations like the Scottish Medicines Consortium (SMC) that issue advice to other NHS organizations, such as the Scottish Health Council which is responsible for the overall strategic direction of the Scottish NHS. Department of Health and Social Services (DoHSS) is directly responsible for planning, provision, and health service delivery through:
Local authorities (Community Services, Primary and Secondary Care)
NHS Trusts, Ambulance, Cancer and Public Health (Tertiary Care)
DoHSS is advised by the All Wales Medicines Strategy Group in addition to NICE.
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Pricing and Reimbursement in the UK
Marketing Authorization
MHRA
HTA Process
DHSC
NHS England
Pricing
Manufacture
Submission
NICE / AWMSG /
SMC / DoHSS
DHSC
Guidance
Patient access
37 weeks
NICE
Reimbursement
ABPI
MARKETING AUTHORIZATION
MA is assessed by the Medicines and Healthcare products Regulatory Agency (MHRA), an agency of the DHSC, and NICE which is an independent public body for England.
HTA PROCESS
The manufacturer submits an application for HTA assessment to NICE.
All Wales Medicines Strategy Group (AWMSG), SMC and DoHSS issue guidance for Wales, Scotland, and Northern Ireland, respectively.
The evidence review group, within or contracted by NICE, identifies, reviews, and summarizes the evidence, as well as conducts economic analyses.
The appraisal committee considers the evidence and decides on the recommendation of the product as a clinically and cost-effective use of NHS resources or for specific subgroups of patients.
The appraisal committee produces the final appraisal document. This guidance is issued to the DHSC within 37 weeks of the manufacturer submission.
PRICING
The Pharmaceutical Price Regulation Scheme (PPRS) is a UK pricing agreement for stable and affordable NHS
anded medicines.
PPRS is regulated by the DHSC (Department of Health and Social Care) and negotiated in collaboration with the ABPI (Association of the British Pharmaceutical Industry)
Statutory pricing mechanisms are also used.
REIMBURSEMENT
NHS England allocates funds within 3 months from the date that the