With Implosion of the health system, new compensation models have gained space in the discussion, including Value Based Healthcare. However, in addition to the issue of mindset, a change of this magnitude implies overcoming numerous challenges, and it must be taken into account that the entire system was designed based on the logic of payment for service.
In an exclusive interview, Cesar Abicalaffe, CEO of 2iM Medical Intelligence and president of IBRAVS (Brazilian Institute for Health Value), discusses this entire scenario, discusses the difficulties, but brings an optimistic view to this change, betting on the model of Value Based Healthcare.
Check out the key points from the interview below.
How do you see the current health scenario?
There's a lot to discuss when it comes to health. I dare say that if we had discussed compensation models before, perhaps the impact on operators' claims would not have been as great as we are seeing today. I talk about the importance of the reform of the compensation model since 2007. It is very difficult to change the current logic, because the paradigm is very strong. It is very focused on the production and delivery of the service to the detriment of the centrality of care on the patient. That's the big difference between the concept of value-based health. The interesting thing about Value Based Healthcare The fact is that it is a model discussed both in countries with socialized medicine - such as European countries - and countries with more mercantilist medicine, such as the United States. When we have countries with very different health system logics discussing the same thing, it's clear that it's important to look at this.
Today you have a regulatory agency that has all the rules built on a pay-per-service logic (the Fee for service). When we talk about a value-based health system, it has to be longitudinal. Today we live in a system that is totally vertical, in which there is a great fragmentation of care, of information systems. These are some of the major challenges we have faced in practice to reform the logic of compensation. The compensation model distorts and directs the logic of assistance. If we don't rethink the model, we're not going to change the assistance. Purchasing high-cost drugs, for example, has to be value-based. Hospitals' compensation must occur in the same way. All of this has to be interconnected: buying, selling, and paying by value.
Until 2018, we had few projects, which has been increasing exponentially, given the crisis we are in. Today we already have a project in the Federation of Unimeds of São Paulo, and we are discussing here in Paraná several Unimeds, projects within the UNIDAS, among others. We're finally getting out of theory. If there is a “silver bullet” in health, I would bet on the compensation model.
Like 2iM, we rethought our analysis model. Since 2018/ 2019, we have created a health value score, the EVS, which is a multicriteria decision analysis metric that composes indicators within the dimensions of processes, outcomes, patient reports, and costing. Everyone in our projects, whether doctors, hospitals, and patients with high-impact clinical conditions, is evaluated within this methodology, obviously modifying the indicators that compose it.
When we made this change in the analysis here at 2iM, we began to receive demands, for example, from the pharmaceutical industry, something that we didn't have until 2019. We already have more than 30 care line assessment projects (where the patient is evaluated here) taking place and at least 70% of them are funded by the industry. But why has the industry been interested in these projects? Because she wants access to real-world data, she wants to participate in the discussion and incorporate her technology. That traditional discount policy if there is a large purchase of the medicine no longer fits today.
The technologies are very expensive and the system will not be able to afford this, so we have to bring the industry to participate in this risk. That's what we've been calling Value Based Agreement, which are value-based agreements involving the entire chain. This is another change that has already started to take place, but it is still timid. We created a specific business unit at 2iM to meet demand. This area includes specific “squads” of analysts, programmers, medical intelligence, and others, mainly because the scope of the analysis has changed. For these projects, it is necessary to monitor the care process, interoperate different systems and evaluate the patient at different moments of their journey in the health system.
Where do you understand that this change should begin?
I think that there really must be a logic that seeks to establish agreements based on value. All of these Players they have to be involved. But to get here I have to build a very robust evaluation process. We received an award from VBHC PRICE DRAGONS ENDORSMENT in Europe in May of this year. The main objective when we submitted our project was to present the EVS — our Health Value Score for the assessment of Care Lines. They awarded us a prize because they saw that we were able to translate the evaluation logic in a very practical way. How is the value evaluated? How do you measure that? Everyone thinks it's cool to discuss value. To get there, we need to have a very consistent evaluation process. Today we have tools for monitoring the patient care line process in real time, because it's no use just looking back to be able to measure what happened. If we hadn't implemented a tool that would follow the patient, every point of their contact, and capture the data so that I could measure the value, we wouldn't get out of theory.
This is the main point: analyzing only retrospective data does not allow us to make an adequate assessment of Value. When we talk about health data, we work with three sets: first, that data that exists and we have access; second, that data that exists, but we don't have access because it is in my system in an unstructured way or it is with another provider, at the pharmacy, registered somewhere else; finally, there is a third set of data that does not exist anywhere, but I will need to collect, such as the patient's experience data, the quality of life data reported by him, etc. These are data that are not generated anywhere. To measure value, we need to look at this.
We built solutions over those two years at 2iM to manage these three data sets. So where do you start? I think it's important to start with specific, small, and controlled projects. Today, we are already mapping about 20 clinical conditions. To begin with, I understand that it is necessary to choose one of these conditions, map the entire care line process for that condition, and clearly define what we need to measure and how we are going to capture that data over time. That's why we suggest starting in a small, controlled environment, funded, obviously, and then we can scale that up. It is important that the project aims to build value-based agreements so that we have the appropriate financial incentive among all those involved and, therefore, align everyone's interests.
How does the pharmaceutical industry enter this circuit? She's a player who traditionally isn't at risk. When you pay for a high-cost pill, regardless of whether the result is positive or negative, you get it. How can this be interesting for this Player?
Today I have more than 30 projects here and at least 60%, 70% of them are funded by the industry. But why? She is willing to participate in the discussions first. The pharma knows that the system is unsustainable and something must be done. Serious drug companies are seeking these deals. We have the example of the logic of the government buying Zolgensma, a drug worth 7 million reais. The government divided it into five payments: it pays the first one, makes the investment and pays the traditional 20% annually. If the child dies, he no longer pays. This is called risk-sharing. There's no way to incorporate high-cost medications if it's not that way.
But it's a big challenge, because when we define a therapy's failure, we need to assess the cause of that outcome. This can be a problem at the time of the execution process, so we need to measure the entire process. Of course we have to look at the outcome, but if we don't measure the process, we don't identify what happened. That's why the industry has gotten into these jobs as well. She wants, together with the provider and the payer, to design and look at this process, if it makes sense. There is acceptance about sharing that risk, as long as there is also some governance over what is being done with that patient.
How does this digital transformation in health relate to this model?
All of this is related to digital logic. I can't imagine that I'll have a consistent evaluation process if I don't capture that data properly. That third set of data that I mentioned that I need and doesn't exist is an issue to be solved with technology. The technologies, the wearables, the tools that generate data at the edge, this is directly linked to the construction of a robust data set to carry out an adequate Value analysis and to be able to pay properly.
Do you have an example of a country that followed a similar path and today has a Value Based Healthcare more consolidated?
There are a few countries, but we haven't seen full action yet. Nordic countries, such as Sweden, and the Netherlands have a very interesting system. The entire government buying process in the Netherlands is based on value. These are countries that have evolved a lot.
The United States also evolved well, although that's where it all began. But one problem is that Americans are acting with the old concepts of compensation models, with a lot of focus on cost.
England is starting. She questioned Porter's model a lot for its reality, since the focus in this country is on population health, with little focus on the clinical condition. Money is difficult for all countries, because the pandemic has impacted the health of the entire world. The countries that were better prepared with this value-based concept are doing better from the post-pandemic crisis.
How do you assess this experience of Value Based Healthcare in five years/ten years?
I am betting most of my money on this logic, but it is a long process of change, especially because of these paradigms that we mentioned. But we are experiencing an interesting movement within the ANS. At the Ministry of Health, we are resuming discussions in this new government. But there are interesting points of discussion within CONITEC, such as thinking about the purchase and incorporation of new technologies also based on value. I believe that this is a movement that has no turning back, but we will need a lot of courage on the part of the payer to start paying by Value and to engage the providers to share this risk. It's not easy, but it's a primal process.
How long do you think it will take for us to have the majority of health centered on Value Based Healthcare?
We have some very strategic measures, changes that I think are fundamental. For example, this is a solution that should come top-down. I understand that when we have a position from the Ministry of Health defining these guidelines as a State strategy, and not a government strategy, we will have a much faster movement. If that doesn't happen and is left to the regular market, I believe it will take longer. I imagine that the actions will continue to take place, but even in a more timid way. I believe that in the short term, between two and three years, we will have at least 50% of the Brazilian system outside the model Fee for service. In the United States, the goal is for payment models to be all value-based by 2030.
I was in China in May of this year and was amazed by what I saw there. I spoke with people and they showed me the logic behind the functioning of their health system. They control everything on the cell phone, the system is completely open. The person makes the appointment, takes the test results, arrives at the hospital and has information about everything that happened to them in the entire system. Everything is controlled directly from the cell phone. This occurred in less than 10 years, because it's a top-down solution. I am not going into the merits of the political situation there, but of the strategy of adopting some actions that deserve, at the very least, to be evaluated.
Finally, I would like to know your impression of where we are going and your perception of where entrepreneurs can help?
I am optimistic and I am a big believer in change. The system will reinvent itself and reorganize itself. As for healthtechs, in my opinion, I think there are two very strong points that we need to look at. I think that today it is no longer up to healthtech not to think about two things: first, a solution that reduces costs and improves operational efficiency, because the system is very inefficient and has a lot of waste; and, second, a solution that seeks patient access and engagement. These two points are fundamental for any technology in the health area to be successful.
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