Cost-effectiveness in American health care

This is one way we try to do it:

Express Scripts Holding Co., a large manager of prescription-drug benefits for U.S. employers and insurers, is seeking deals with pharmaceutical companies that would set pricing for some cancer drugs based on how well they work. […]

Drug companies are countering with pricing models of their own, such as offering free doses during a trial period. […]

Express Scripts’ approach would be similar to that proposed by Peter Bach, director of the Center for Health Policy and Outcomes at Memorial Sloan Kettering Cancer Center.

In an article published last year in the Journal of the American Medical Association [link], he suggested that in an indication-specific arrangement, the monthly price for Eli Lilly & Co.’s cancer drug Erbitux would plummet from $10,320 a patient to about $470 a patient for its least effective use, treating recurrent or metastatic head and neck cancer.

This is one way it gets rolled back:

The controversy over the new crop of hepatitis C treatments has taken yet another turn as consumers are starting to file lawsuits against insurers that deny them access to the medicines. Over the past two weeks, two different women alleged that Anthem Blue Cross refused to pay for the Harvoni treatment sold by Gilead Sciences because it was not deemed “medically necessary.” […]

Both lawsuits claim the insurer denied coverage for Harvoni, one of two hepatitis C treatments sold by Gilead, because the amount of liver damage sustained by the women was insufficient to warrant payment for the drug. In both cases, the insurer decided that Harvoni was not medically necessary, according to the lawsuits.

Prior TIE coverage of “medically necessary” care and the law here and here. Maybe there’s more here somewhere, but I forget where.


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