Navigate the transition to value-based care in life sciences

The path to an effective value assessment depends first on what the assessment includes in terms of the different ways a diagnostic test or technology can have an impact on (value drivers), and thereby benefit, the patient care pathway, as described in the Comprehensiveness Principle.

Five broad categories of 'value drivers'—clinical impact, nonclinical patient impact, care delivery revenue and cost impact, public or population impact, and environmental impact—can be incorporated in the value assessment process to capture the full spectrum of ways a diagnostic test may create value.

These assessment categories go beyond the traditional measure of clinical efficacy to capture additional patient-focused and ESG-focused considerations. They consider the impact on the effectiveness and efficiency of care delivered under new value-based performance metrics and reimbursement models.

It’s important to recognize that these five categories are relevant across the health care ecosystem and reflect the perspectives and priorities of many different stakeholders—payers, providers, new 'at-risk' providers who must think like payers, and government agencies; and, of course, patients, caregivers, and patient groups.

All stakeholders value clinical impact. They also consider the drivers of value identified in this framework but may prioritize them differently. As market dynamics and priorities shift under emerging value-based payment models, the prominence of patient-centric measures is growing. Providers are beginning to look at efficiency in new ways and across the care continuum. Stakeholders likely will continue to prioritize drivers in different ways, but there may be a greater push to emphasize these broader drivers of value—especially patient-centered measures—across stakeholder groups.

Download the complete report for a deeper dive into the value drivers.

Each stakeholder is ultimately looking to generate a robust assessment of the value that a specific diagnostic test is expected to deliver; this occurs after considering the offsetting costs of adoption and calculating the costs of potential risks. In the traditional fee-for-service model of care delivery, many factors in an assessment may have been less relevant. In this new environment, stakeholders must optimize decisions on use of resources while considering new performance goals for the effectiveness and efficiency of care for different patient populations.

An effective assessment process will result in a final analysis of the expected 'value proposition' that:

• Details the ways a diagnostic test will deliver an impact, together with scenarios to describe the magnitude of the impact and offsetting costs.
• Reflects the unique characteristics that should be considered based on the type of diagnostic test being assessed.
• Considers the range of relevant time frames associated with testing or impact of a test.
• Acknowledges relevant patient sub-populations that may experience significantly greater or lesser impacts than the general (intended use) population.

This expected value proposition should be explicitly tied to the available credible evidence that supports the calculation and valuation of the estimated impacts. The type of evidence that is appropriate and available will vary by value driver and by the specific purpose of the assessment.

As the US health care system shifts further toward value-based payment models, diagnostic test developers increasingly will need to adopt a systematic approach to diagnostics value assessment. While there are benefits to such an approach, the broad range of diagnostic test applications present unique challenges in demonstrating value in a systematic manner. The distinctions between different types of tests must be accounted for in value assessment to help ensure access to all types of diagnostic innovations.

The major types of diagnostic tests include screening, detection, prognostic, theranostic, monitoring, and recurrence.

To explore our list of considerations in demonstrating value by diagnostic test type, download the complete report.

AdvaMedDx's approach uses the five categories of value drivers to define the ways that a test can create value and includes sample questions and metrics to consider in building or assessing the value proposition of a specific diagnostic test.

Download our report to explore how these questions and metrics indicate how multiple factors can be combined to capture the unique value profile of a particular diagnostic test.

Clinical impact

The clinical impact assessment captures subcategories of unique value drivers: sources of value created by traditional value subcategories, as well as patient safety/tolerability/ compliance and patient response to diagnostic results.

Non-clinical patient impact

The assessment of non-clinical patient impact aligns two subcategories of value drivers: 1) sources of value stemming from patient experience and 2) patient economics. These can be specific to the patient population being treated as well as inclusive of value to family members or caregivers. Some of these patient-centric or patient-reported value drivers are tracked and measured using qualitative versus quantitative sources. While the metrics are not always easily or robustly quantifiable, they are measurable and important and should be accounted for in impact assessments.

Care delivery revenue and cost impact

Care delivery revenue and cost impact consider the economic effect on the health system of both the immediate episode of care and long-term disease progression. The care delivery driver recognizes that a new diagnostic test can impact both the ability of health care providers to earn incremental revenue but also incur costs. Two subcategories of this value driver include sources of value resulting from improving quality of care economics and care efficiency.

Public/population impact

This category considers the impact of a diagnostic test or technology’s introduction for large segments of the patient population on overall population health as well as health care systems’ costs to society on a macro level. The assessment focuses on two subcategories of value drivers: sources of value linked to population health and workforce productivity.

Environmental impact

This category considers the impact of ESG initiatives with a focus on environment, which are increasingly gaining momentum across various stakeholders. This value category assesses the value of a diagnostic device taking into consideration the monetary impact of a diagnostic test and the impact on an organization’s perception and differentiation due to environment-focused initiatives.

Diagnostic test developers recognize that payers and providers are intensifying their scrutiny of choices with respect to diagnostic tests and other technologies and are changing their expectations regarding the levels and types of evidence used to demonstrate value. The desires to keep the patient “first” and to better incorporate the patient perspective in value assessment methodologies are gaining broader stakeholder acceptance and changing the dialogue on appropriate types of evidence to consider.

For diagnostics, the patient perspective can be particularly challenging with respect to details about the test itself, access to testing, specimen collection, and the understanding of the test result because most patients do not order tests directly; nor do they interpret the test results themselves. However, patients will have important perspective on the choices available to them based on information provided by the diagnostic test. So, it’s increasingly important to include the patient in the dialogue.

For a deeper dive into the development of evidence guidelines, download the full report.