The State of Drug Affordability Programs and Reformation Solutions

In this interview, Vishali Amin, VP of Value Delivery at Kalderos, discusses the impact of drug affordability on Medicare patients and medical costs, as well as the barriers preventing patients from benefiting from existing programs, the need for waste and inefficiency reform, and the positive benefits of increased transparency in health care data.

Please share your name, title, affiliation, and a brief overview of your professional history. 

My name is Vishali Amin, I'm the vice president of value delivery at Kalderos. I'm responsible for delivering value to our customers while also improving processes and efficiencies across not only Medicaid 340B but also the commercial programs as well. I started my career at Kalderos in the manufacturing space in customer success. In that role and my current role, my work focuses on driving cross-functional process improvement, transparency within datasets, value delivery, and product innovation. 

My background spans 8 years as a pharmacist in retail and hospital settings, including a role as a clinical pharmacist at the University of Chicago Medicine. Throughout my career, I've been immersed in patient care, healthcare processes, and the dynamics of prescription drugs, both in retail and clinical pharmacy settings. This experience has provided me with valuable insights into the complexities of prescription decision-making and the transition of care from hospital to retail pharmacy. Now, in the realm of healthcare technology, I am poised to apply this expertise to drive scalable improvements in efficiency across manufacturers and multiple other stakeholders. This includes addressing issues such as drug affordability for patients, sky-rocketing medical costs, barriers to program access, and the transformative potential of enhanced transparency utilizing healthcare data.

How does drug affordability impact Medicare program patients and Medicare medical costs and why is this an important area of interest in health care? 

Medicare is a massive program in general, and high drug prices can directly impact the cost of that program. Medicare Part D is a huge focus because it deals with prescription drugs specifically, and it's a huge part of Medicare's overall spending. When we see drug prices increase, we see that directly correlate with the increase in the Medicare program as well. What that can lead to is increased out-of-pocket expenses for the beneficiaries of that program, too. 

Many Medicare patients are on fixed incomes and when they incur increased medication costs, even through the Medicare program, they often must make a challenging decision of whether they're going to pay for, say, their utility bills or their medications. At the point of sale, I’ve seen many instances where customers will try and pick up their medications, but when they find out their copay, they'll decide in some instances to just leave their medications behind. Compliance with certain medications may drop if the cost is too high, which may save the patient some money upfront, but that choice may lead to increased doctor visits or hospitalizations that ultimately keep increasing the cost of the program. 

What are the current barriers keeping patients from benefiting from existing programs to make drugs more affordable? 

When considering a more holistic approach to these programs, there are two main ways that a patient can benefit from an existing program: directly or indirectly. The Medicare program or Medicaid program, for example, benefits the patient directly because they get a lower drug cost when picking up a prescription. In the 340B program, though, the patient benefit is indirect because the decreased cost of a drug is passed on to the covered entity and is meant to be used for expanding patient care or expanding access to those patients who need it. 

I think in the direct case, it's a lot easier for the patient to feel impacted right away because they see the financial upside at the point of sale. In the 340B program, it's up to the covered entity as to how they want to use those additional funds to better serve their patient population. In addition, there are also manufacturer-issued drug discount cards. If a patient does not have insurance, they may have the ability to access a drug discount card. However, many patients are unaware these exist or how to gain access to them. There are a lot of barriers, and our system is not simplistic by any means. It is incredibly challenging for patients to understand which benefit applies to them and how they're able to access it, which negatively impacts the overall patient care experience. 

How can waste and inefficiency be reformed for the benefit of all parties? 

Excess or waste is detrimental to all parties. Margins are being cut across all of the stakeholders, and there is a lot of energy, time, resources, and people exhausted across all parties to make sure that the discount is being applied at the right place. All stakeholders are trying to either avoid, identify, or resolve duplicate discounts. 
During my time as a clinical pharmacist, I observed many large medical centers investing in dedicated teams to ensure they had measures in place to ensure compliance with the 340B program. There is a significant cost and added expense for those entities to maintain these processes. On the flip side, manufacturers also spend millions of dollars, extraordinary amounts of time, and valuable resources on analysts, third-party vendors, and technology to try and identify when that waste is happening. On the state side, they are bogged down with navigating endless disputes with limited resources.  

As the 340B program hit a certain threshold of waste and became too expansive, you've seen more aggressive measures taken by manufacturers to try and stop the hemorrhaging. Consequently, loopholes may be leveraged by covered entities to try and ensure that they get the resources and discounts they need to provide patient care. The states may put out more policies to curtail these issues, which makes the system more and more complex to try and enforce. It’s a vicious cycle. 
If we can solve waste, we can increase efficiency for all stakeholders, allowing more positive work to be accomplished with the resources currently being used to stop the waste.

Please elaborate on the connection between increased transparency and positive benefits for patients. 

I work with data every day, and I can tell you that the datasets are convoluted, incomplete, and extremely messy to work with. Transparency across stakeholders is imperative. As I mentioned earlier, the system is not simple. It is incredibly complex, and records have to be meticulous. We must be able to track the complete data sets in a way visible to all the stakeholders involved to have the programs work as they were intended. Most stakeholders believe that these programs should exist. They also believe these discounts need to be applied correctly. 

Right now, stakeholders are functioning blind. We’ve seen that stakeholders are open to collaborating from our work with covered entities, states, and manufacturers on our 340B Medicaid platform. When we've surfaced insights from the covered entity to the state that the manufacturer is disputing, the state comes to the table, and vice versa with the covered entity. With data transparency comes a willingness to collaborate more effectively.  

Who are the key stakeholders in the drug discount ecosystem and how are they trying to solve drug affordability? 

The key stakeholders at a high level are manufacturers, providers, payers, and wholesalers. Kalderos has had experience working with manufacturers, covered entities, and the state agencies on the 340B and Medicaid programs. We have found that most of the players in the space all have the same intent. They all are working in good faith and trying to ensure that the 340B program stays intact, is appropriately regulated, and that the patient populations that each stakeholder serves are getting the benefits that they need. It's unfortunate to see the challenges that arise from the disjointed datasets and murky regulations available. 

In your opinion, what is the future evolution of drug affordability programs in the US?

We see a system broken and creating a lot of tension between the different stakeholders that are supposed to be working together. What Is probably more concerning is that we seem to be repeating the same mistakes by layering in more discount programs using the same rules, regulations, and methods to try and solve the duplications. I believe we need a technology-based approach that allows for scalability and transparency but also accounts for and is leveraged by all the players in the discount ecosystem. Right now, everyone is using their system and process of trying to keep things straight. But this just results in more datasets that are disjointed, segmented, and fragmented. Taking a more holistic approach that leverages technology with all the stakeholders will be more successful in the future.

Is there anything else you would like to add that we have not discussed?

I think this was the theme throughout, but I'll just go ahead and say it one more time just to make sure that it's hammered home. I truly believe to solve this problem we need to move away from a siloed style of problem solving. It ends up creating an action by one stakeholder that results in a counteraction by another stakeholder and just perpetuates the cycle without solving the problem. I truly believe that all stakeholders need to come to the table with the intent to have drug discount programs work the way that they were intended to so that the patient can get the benefits that they need. However, the program must be regulated and enforced to be sustainable going forward.