Type 2 Diabetes – Access & Reimbursement – Detailed, Expanded Analysis Type 2 Diabetes And Obesity (US)

Type 2 diabetes and obesity are chronic diseases that affect millions of Americans and represent a costly expense for the nation’s healthcare payers. In the effort to manage quality and costs associated with treating these conditions, many health insurers have turned to accountable care organizations (ACOs) to better coordinate care for large patient populations. Given the large affected population and the availability of a range of effective drugs and measurable outcomes, type 2 diabetes represents the low-hanging fruit for the ACO. As a contributor to diabetes, obesity has also become a focus of ACO management, especially since the emergence of novel branded therapies—including the latest, Orexigen Therapeutics/Takeda Pharmaceutical’s Contrave (naltrexone SR/bupropion SR)—that illicit greater weight loss but are much more expensive than generic phentermine. As ACOs work to manage diabetes care, they are faced with a broad array of branded, non-insulin therapies whose distinct mechanisms of action improve upon the effectiveness of generic metformin. These classes have become familiar to payers over the past decade: oral DPP-IV inhibitors, such as Merck’s Januvia (sitagliptin); the oral SGLT-2 inhibitors, such as Johnson & Johnson’s Invokana (canagliflozin); and the injectable GLP-1 agonists, such as Novo Nordisk’s Victoza (liraglutide). ACOs are making PCPs and endocrinologists more conscious of the long-term consequences of each prescribing decision by linking their reimbursement to the achievement of goals such as reducing hospital readmissions and total medical costs, as well as saving on prescription drug costs.

Questions Answered:

  • The novel weight-loss drugs that have launched in the United States since 2012 have struggled to gain coverage through Medicare, but their potential to help curb the diabetic epidemic increases their chances for coverage in the commercial ACO setting. What percentage of managed care organization (MCO) directors say that their commercial ACOs are more likely to cover obesity drugs in the ACO setting because of the ACO’s focus on diabetes management? What is the difference in coverage and tiering among the branded weight-loss therapies, and how widespread are formulary exclusions? How has ACO involvement affected PCPs’ and endocrinologists’ prescribing patterns for weight-loss drugs?
  • Surveyed physicians’ prescribing is influenced by a variety of factors, including the preferred therapies established by their ACOs. How do PCPs and endocrinologists value the various attributes of diabetes (and obesity drugs) differently in the ACO setting versus their normal practice? How are physicians encouraged to meet the goals of the ACO? What are surveyed physicians reporting about their ACOs’ impact on the drug choices they make? What formulary do physicians use when prescribing drugs?
  • A primary feature of an ACO is the financial incentives that are built in to hold providers accountable for the care of ACO members, but the level of accountability varies by ACO. How do MCOs hold providers in the ACO responsible for keeping drug spending in check? Do MCOs expect ACOs to take full financial risk for pharmacy as well as medical services and in what time frame? On what quality measures are physicians tracked—both general ACO measures and those relating to diabetes and obesity drugs in particular?

Scope:

Markets covered: United States.

Primary research: Online survey of 70 PCPs and 71 endocrinologists, 30 MCO medical directors, and 11 MCO pharmacy directors.

Commercial context: Drug profiles, epidemiology tables, drug-treatment algorithms, and ACO background information.

Therapies covered: Weight-loss therapies and three classes of antidiabetic drugs: DPP-IV inhibitors, GLP-1 receptor agonists, and SGLT-2 inhibitors.

Table of contents

  • Type 2 Diabetes - Access & Reimbursement - Detailed, Expanded Analysis Type 2 Diabetes And Obesity (US)
    • Actionable Recommendations to Optimize Market Access
      • Successes and Stumbles
        • Successes and Stumbles Among Weight-Loss and Antidiabetic Therapies
        • United States: Reimbursement Success and Stumbles
          • Reimbursement Successes or Stumbles for Branded Weight-Loss Drugs
          • Reimbursement Successes or Stumbles for Select Antidiabetic Drugs
      • Key Stakeholders in the Road to Market Access
        • Key Stakeholders in the Path to Formulary Access
        • Stakeholder Dynamics in the Road to Reimbursement
      • Key Market Access Roadblocks
        • Key Market Access Roadblocks for Weight-Loss and Antidiabetic Agents in ACOs
      • Reimbursement Dynamics
        • United States: Commercial Managed Care Organizations
          • Lessons Learned and Key Takeaways
          • Most Influential Drivers of Reimbursement by MCOs for Weight-Loss and Antidiabetic Drugs:
          • Key P&R Drivers in the ACO Setting
          • Key Findings
          • Restrictions
          • Restrictions for Antiobesity Drugs
          • Restrictions for Antidiabetic Drug Classes
          • Most Common PA Requirements for Leading Branded Antiobesity Agents
          • Most Common PA Requirements for Leading Antidiabetic Classes
          • How MCOs Hold ACO Contractors Responsible for Prescription Drug Costs
      • Pricing and Reimbursement, Policy, and Coverage: Impact on Prescribing
        • Patient Share in Key Payer Channel
          • Patient Share of Weight-Loss Drugs
          • Physician-Reported ACO Impact on Prescribing of Antiobesity Drugs
          • Patient Share of Antidiabetic Drug Classes
          • Physician-Reported ACO Impact on Prescribing of Antidiabetic Drugs
          • Patient Share of Antidiabetic Drugs
          • Top Prescribing Drivers for Weight-Loss and Antidiabetic Drugs in the ACO Setting vs. Normal Practiceu2014Endocrinologists
        • Impact of Payer Policy on Prescribing
          • Payer Restrictions Encountered by Physicians
          • Physician-Reported Most-Encountered Restrictions
          • Key Levers and Constraints on Select Therapies*
      • Appendix
        • Physician Survey
          • Weight-Loss Drugs Prescribed by Physicians
          • Physician-Reported Patient Share of T2 Diabetes Drug Classes
          • Types of Payers with Whom ACOs Contract u2013 Current Participants
          • Types of Payers with Whom Future Participants Expect ACOs to Contract
          • Characterization of Physician Practice
          • Number of ACO Contracts in Which Physicians Participate
          • Number of ACO Contracts in Which Physicians Expect to Participate in 12 Months
          • Number of Patients Currently in Physiciansu2019 ACOs
          • Percentage of Obese and Diabetic Patients Expected to Be in ACOs in 12 Months
          • Physician-Reported Patient Share of Weight-Loss Drugs
          • Impact of ACO Involvement on Physiciansu2019 Prescribing of Weight-Loss Drugs
          • Physician-Reported Patient Share of DPP-IV Inhibitors in Diabetes
          • Impact of ACO Involvement on Physiciansu2019 Prescribing of DPP-IV Inhibitors
          • Physician-Reported Patient Share of SGLT-2 Inhibitors in Diabetes
          • Impact of ACO Involvement on Physiciansu2019 Prescribing of SGLT-2 Inhibitors
          • Physician-Reported Patient Share of GLP-1 Inhibitors in Diabetes
          • Impact of ACO Involvement on Physiciansu2019 Prescribing of GLP-1 Inhibitors
          • Payer Restrictions Encountered by Physicians
          • Basis of Physician Compensation in ACO Model
          • How ACOs Are Structured to Financially Encourage Physicians
          • Physician Experience with Higher Compensation in the ACO
          • Influence of Increased ACO Compensation on Drug Choice u2013 PCPs
          • Influence of Increased ACO Compensation on Drug Choice u2013 Endocrinologists
          • General ACO Metrics on Which Physician Performance Is Tracked
          • ACO Metrics Related to Obesity
          • ACO Metrics Related to Type 2 Diabetes
          • Anticipated Basis of Physician Compensation in ACO in 12 Monthsu2014Future ACO Participants
          • How ACOs Will Be Structured to Financially Encourage Physicians in 12 Monthsu2014Future ACO Participants
          • General ACO Metrics on Which Physician Performance Will Be Tracked in 12 Monthsu2014Future ACO Participants
          • ACO Metrics Related to Obesity on Which Physician Performance Will Be Tracked in 12 Monthsu2014Future ACO Participants
          • ACO Metrics Related to Type 2 Diabetes on Which Physician Performance Will Be Tracked in 12 Monthsu2014Future ACO Participants
          • Primary Challenges Facing Physicians in the ACO
          • Formulary Use by Physicians in ACOs
          • Physician Reaction to Conflicting Formularies
          • Designation of Preferred Obesity and Diabetes Drugs in the ACO
          • Anticipated Formulary Use by Future ACO Participants
          • Anticipated Designation of Preferred Obesity and Diabetes Drugs in the ACOu2014Future Participants
          • Use of Protocols and Guidelines for Drug Prescribing in the ACO
          • ACO Encouragement/Discouragement of Type 2 Diabetes Drug Classes
          • Sources of ACO Guidelines
          • Future Participantsu2019 Anticipation of ACO Protocols and Guidelines for Type 2 Diabetes and Obesity Drugs
          • Future Participantsu2019 Anticipation of ACO Encouragement/Discouragement of Diabetes Drug Classes
          • ACO Encouragement/Discouragement of Specific Diabetes Drugs
          • ACO Encouragement/Discouragement of Specific Obesity Drugs
          • How ACOs Discourage Drug Prescribing
          • PCP-Reported Important Attributes in Drug Choiceu2014ACO vs. Normal Practice
          • Endocrinologist-Reported Important Attributes in Drug Choiceu2014ACO vs. Normal Practice
          • Use of Electronic Health Records in the ACO
          • Features of EHR Systems Used in ACOs
          • Usefulness of EHR in ACO Job Performance
        • MCO Survey
          • Anticipated ACO Membership by Plan Typeu2014Future ACO Participants
          • Frequency of P&T Committee Meetings
          • Individuals with Most Influence on MCO Formulary Decisions
          • Ranking of Most Influential Factors on Formulary Placement of Weight-Loss and Antidiabetic Drugs
          • Preferred Comparator for Emerging Weight-Loss Agents
          • Preferred Comparator for Emerging Antidiabetic Agents
          • Number of ACO Contracts Reported by MCOs
          • Number of ACO Contracts Anticipated by MCOs in 12 Months
          • Estimated Percentage of MCO Membership in an ACO
          • Anticipated Percentage of MCO Members in an ACO in 12 Months
          • Percentage of Contracted Physicians Expected to Be in ACOs
          • Top Reasons MCOs Contract with ACOs
          • Indications Most Likely to Result in Better Outcomes in ACOs
          • Indications Most Likely to Result in Reduced Costs in ACOs
          • Ways in Which ACOs Are Held Accountable for Drug Costs
          • Ways in Which ACOs Will Be Held Accountable for Drug Costsu2014Future Participants
          • How ACOs Are Structured to Encourage ACO Physicians
          • How ACOs Will Be Structured to Encourage ACO Physiciansu2014Future Participants
          • General Performance Measures Tracked by ACOs
          • Obesity- and Diabetes-Related Performance Measures Tracked by ACOs
          • MCO Expectations for ACOs Assuming Full Risk for All Services
          • Time Frame of Anticipated ACO Movement to Full Risk
          • MCO Reimbursement of Weight-Loss Therapies
          • MCO Reimbursement of Weight-Loss Therapies in 12 Months
          • MCO Reimbursement of Antidiabetic Therapies
          • MCO Reimbursement of Antidiabetic Therapies in 12 Months
          • Preferred/Nonpreferred Status of Weight-Loss Drugs
          • Preferred/Nonpreferred Status of Antidiabetic Drugs
          • Impact of ACO Focus on Diabetes on Weight-Loss Drug Coverage
          • Employer Purchase of Drug Riders for Weight-Loss Agents
          • Impact of ACOsu2019 Diabetes Focus on Coverage of Antidiabetic Drug Classes
          • Use of Value-Based Benefit Designs for ACOs
          • Drugs and Services Encouraged by a Value-Based Benefit
          • Restrictions on Use of Weight-Loss Drugs in MCOsu2019 Largest Commercial Plans
          • PA Requirements on Weight-Loss Drugs in MCOsu2019 Largest Commercial Plans
          • Reauthorization Requirements for Weight-Loss Drugs
          • Time Frame for Reauthorization of Weight-Loss Drugs
          • Restrictions on Use of Antidiabetic Drug Classes in MCOsu2019 Largest Commercial Plans
          • PA Requirements on Antidiabetic Drug Classes in MCOsu2019 Largest Commercial Plans
          • Reauthorization Requirements for Antidiabetic Drug Classes
          • Time Frame for Reauthorization of Antidiabetic Drug Classes
          • Formulary Use in the ACO
          • Formulary Applied to ACO Membersu2019 Claims at Point of Sale
          • Outlook for Dedicated ACO Formularies in Three Years
          • MCO Responses to Conflicting ACO/MCO Formularies
          • ACO Impact on Restrictions of Weight-Loss and Antidiabetic Drugs
          • None of these factors are influential
          • MCO Optimism About ACO Outcomes Achievement
          • Outcomes Achieved by ACOs
          • Shared Savings Produced by ACOs
          • Percentage of Savings in ACOs with Shared Savings
          • MCO View of Pharmau2019s Role in Making ACOs Work
          • Survey Analysis Commercial Plan Tier Structure
          • Survey Analysis Commercial Plan Tier Structure
          • Survey Analysis: Commercial Plan Cost-Sharing Tiers
          • Survey Analysis: Commercial Plan Coinsurance Amounts
        • Additional Information
          • How ACOs Financially Encourage Physicians to Meet ACO Goals
          • General ACO Metrics Tracked in the ACO
          • ACO Metrics Related to Obesity Tracked as Part of ACO Physician Performance
          • ACO Metrics Related to Diabetes Tracked as Part of ACO Physician Performance
          • How Pharmaceutical Companies Can Best Partner with MCOs on ACOs
          • Current Coverage of Drugs by MCOs
          • Future Coverage of Drugs by MCOs in 12 Monthsu2019 Time
          • Total Prevalent Cases in the United States, 2014-2018
          • Commercial Context: Currently Marketed Weight-Loss Therapies
          • Commercial Context Key Events in the Obesity Market
          • Prevalence of Type 2 Diabetes in the United States, 2014-2024
          • Practice Guidelines for T2 Diabetes
          • Commercial Context: Non-Insulin Antidiabetic Drugs
          • Commercial Context ACO Structure
          • Commercial Context: ACOs
          • Survey Results u2013 ACO Demographics

    launch Related Market Assessment Reports