May 5, 2015
Why We Must Stop ‘Bucketing’ Healthcare
"Bucketing" looks at the expense of drugs and treatments individually, not as part of the entire course of care, and inflates costs.
Health insurance plans should be designed to spur the use of the highest-value pharmaceuticals as well as the highest-value care delivery services.
In some cases, plans do seek to ensure access to the highest-value care regardless of how it is delivered. Think for a moment about implantable devices, from drug-eluting coronary stents to replacement joints. Patients don’t have to pay for the stent outside of their insurance; it’s included in the total cost of their care because it’s less expensive to cure an individual’s heart or hip than it is to pay for the multiple episodes of care required by a lack of effective treatment.
Yet many plans are set up with “buckets” of money that don’t make sense and destroy value. For example, bucketing means there are plans that discourage the use of high-value blood pressure medications because the broader adoption of this therapy caused the plan to exceed its budget for medications – even though the therapy saved dramatically on the cost of hospital and disability care and the reduced incidence of heart attacks and strokes. (As a side note, these savings materialize much more quickly than many typically expect. Better use of blood control medications can reduce the incidence of strokes and heart attacks in as little as six months.)
There are also many specialty medications that are exceedingly expensive and tremendously effective. Their use can reduce the overall costs of care, but bucketing means the payment system often isn’t sure how to incorporate them. Examples include new medications for curing hepatitis C as well as “orphan drugs” for rare diseases, including unusual expressions of hemophilia, cystic fibrosis and Gaucher’s disease.
So what’s stopping providers from inciting the use of high-value medications? First, too few of the medications (or treatments of any sort) have good outcome data that shows results and costs over the full cycle of care. Second, few providers are set up to provide comprehensive, full-cycle care.
The way to get these high-value medications included in care is to eliminate the use of bucketing and instead look at the total cost of care for a patient’s medical circumstances. In the case of an infection like hepatitis C, that cycle of care would be from the time of diagnosis until the patient is cured. For conditions perceived as non-curable or lasting for an extended duration, it would typically be for a period of time or through a particular episode (e.g., an acute flare-up of Crohn’s).
This has been done for Gaucher’s disease, particularly in countries with nationalized healthcare, because the new drugs dramatically reduce the total cost of care. Untreated, the condition requires multiple, expensive and painful surgeries. For plans to encourage value-based care, they must similarly minimize fragmentation and instead consider the holistic needs of each medical condition. Only then can the industry truly improve health outcomes and reduce overall spending.