Covering Patients With SMA: Payer Challenges

Ed Pezalla, MD, MPH, chief executive officer of Enlightenment Bioconsult, LLC, provides insight on challenges payers face when covering patients with spinal muscular atrophy, including proper diagnosis.

Welcome back to PopHealth Perspectives, a conversation with the Population Health Learning Network, where we combine expert commentary and exclusive insight into key issues in population health management and more. In this episode Dr Ed Pezalla provides insight into challenges that payers face when covering patients with spinal muscular atrophy.

Hello, I'm Dr Ed Pezalla, I'm CEO of Enlightenment Bioconsult, LLC. I work full-time as a payer strategy and market access consultant to pharma and biotech firms. And prior to that, I was vice president for pharmaceutical policy and strategy at Aetna, where I was responsible for how drugs are reviewed, development of clinical policy, and input from the P&T committee to create formularies and cover decisions for both medical and pharmacy benefits, as well as for Medicare, Medicaid, and commercial business.
Prior to that, I was vice president for Clinical Services at Prescription Solutions, a wholly owned subsidiary pharmacy benefit manager of Pacific Care. My training is in pediatrics, public health, and health policy.

From a payer perspective, what is challenging about covering this patient population?

There are several important challenges here. First is to make sure that the diagnosis has been done properly. The good news with that is that almost all of these patients and all the patients who are seeking these advanced therapies are being treated by pediatric neurologists, geneticists and others who are specialists in their field. Most payers do require that treatment with the drugs that I've mentioned, and the gene therapy be conducted at a center where these patients are generally cared for and experts who are familiar both with the disease process and with the drugs themselves.

That helps a lot in making sure that there has been a proper diagnosis, because most of these drugs, in particular the gene therapy, but the others, will not work if the patient does not have the particular genetic mutation. These are very much founded on the treatment of the genetic disorder, so we have to make sure we have the right one, and the experts are quite good at making the diagnosis and documenting that with the appropriate testing. That’s the first challenge, but really it seems like it has been taken care of.

The next one, of course, is that these are all expensive therapies and they all received a lot of attention in the press because of their pricing, and in particular nusinersen and Zolgensma. With that in mind, and the fact that they combined therapies, payers must budget for that. They do budget for that, if it's appropriate to treat the patients who will benefit from these particular therapies, and so there is a budgetary concern. And, of course, it's especially a budgetary concern for Medicaid programs since they have disproportionately more children in those programs than many of the commercial insured populations do.

It's also a challenge for self-insured employers, especially the smaller employers. They have fewer patients and families to pool the premiums over, and the sudden appearance of 1 or even 2 children with SMA can be a serious challenge there. The budget challenge continues, as it does for many other rare disease states, where we have very expensive therapies and a small number of patients.

A small number of patients means that it's hard to predict how many new patients you will have. And especially in this case, where the treatment is generally done at a young age, we're really talking about not just the prevalence of the disease, but the incidents of the disease, and it's quite spotty and unpredictable, which causes no end of trouble for finance folks who really seek predictability, because they require that in order to make businesses and health plans run smoothly.

I think the other challenge here is that we do see turnover of patients from one health plan to the next. This is often cited by payers, payer representatives, that it's a serious problem, especially for one-off gene therapies, because they feel that I’m treating a patient with a rare disease. I have a benefit that allows for that gene therapy. I'm paying perhaps millions of dollars for it, and then the patient leaves my plan within the next year, and since it's this rare disease we're not seeing another patient come from some other plan who's already been treated. So you feel that I made an investment and I'm not seeing the return on that investment in any way.

One of the things we need to keep in mind is that although patients do come and go from plans, patients, especially young patients with serious diseases, are less likely to do so. The parents try to keep them in a particular plan since they've already now arranged for their medications, for the hospitals, for the doctors who care for them. They don't want to make changes if they can avoid it.

Now if they're staying with the same ultimate payer, that is the employer, and the employer is self-insured, then it really doesn't matter who is managing the benefit for that employer. It's really the employer, and they generally tend to keep their employees for a longer period of time, especially in the setting where there is a child with a serious disorder.

But we do see patients go in and out of Medicaid because of eligibility requirements and changes. That was put on hold a lot during the major part of the COVID-19 outbreak, but we're now getting back to where many patients will actually leave Medicaid and need to come back in. That will become an issue for Medicaid and for those patients, because it means that they may miss a treatment or a follow up because of the needing to wait for approval by Medicaid to come back in.

Great. Thank you. Is there anything else you'd like to add to the conversation today?

I'd like to say that we get great responses from the providers, the doctors, nurses, and others who are caring for these patients. They are very glad that they finally have approved therapies that can be effective in helping these patients and their families. Although they sometimes are frustrated by having to fill out the paperwork for the payers, they are glad that there is coverage from the different types of payers for these medications, and this really has made a difference in the lives of patients and their families with SMA.

Thanks for tuning in to another episode of PopHealth Perspectives. For similar content, or to join our mailing list, visit populationhealthnet.com.