Payment Models for Sickle-Cell Disease Gene Therapies in Colorado Medicaid: Real-World Data Analysis
Moderator
Antal T Zemplenyi, MSc, PhD, University of Colorado Skaggs School of Pharmacy and Pharmaceutical Science, Denver, CO, United States
Speakers
Jim Leonard; Garth C Wright; Michael DiStefano, PhD, University of Colorado, Aurora, CO, United States; Kavita V Nair; Kelly Anderson, MPP, PhD, University of Colorado Anschutz Medical Campus, Aurora, CO, United States; Robert B McQueen, BA, MA, PhD, University of Colorado Skaggs School of Pharmacy and Pharmaceutical Science, Denver, CO, United States
Problem Statement: Colorado Medicaid faced the challenge of covering high-cost gene therapies for sickle-cell disease (SCD) while ensuring sustainable, value-based spending. The introduction of exagamglogene autotemcel (exa-cel) and lovotibeglogene autotemcel (lovo-cel) required a comprehensive evaluation of potential payment strategies.
Description: To inform this decision, Colorado Medicaid analyzed real-world data from the Health Care Policy & Financing database, focusing on the costs associated with severe SCD patients from 2018 to 2023. This analysis evaluated several payment models proposed by the Center for Medicare and Medicaid Innovation under the Gene Therapy Access Model. These models included outcome-based agreements (OBAs), volume-based rebates, and guaranteed rebates over a six-year contract period, with scenarios accounting for different criteria related to vaso-occlusive events and treatment durability. Three-state Markov models were employed to compare the costs of standard-of-care (SoC) treatments with those of gene therapies, both with and without the proposed payment models. The findings indicated that gene therapies resulted in a negative cumulative balance, averaging -$2.11M for exa-cel and -$3.00M for lovo-cel per patient over six years compared to SoC. However, OBAs could potentially save Medicaid approximately $260K (UI $88K-$772K) per patient on average for exa-cel, and $367K (UI $122K-$1,111K) for lovo-cel. Volume-based and guaranteed rebates also showed potential savings, but the impact varied based on contract duration and the effectiveness of gene therapy.
Lessons Learned: The study found that achieving budget neutrality over six years is unlikely because the costs associated with the SoC are relatively low. However, innovative payment models could improve value-based spending by linking high therapy costs with potential health outcomes. The significance of real-world data was emphasized in identifying eligible patient populations and determining the actual costs of SoC. Furthermore, the analysis pointed out that the duration of contracts has a significant impact on financial outcomes.
Stakeholder Perspective: Colorado Medicaid.
Description: To inform this decision, Colorado Medicaid analyzed real-world data from the Health Care Policy & Financing database, focusing on the costs associated with severe SCD patients from 2018 to 2023. This analysis evaluated several payment models proposed by the Center for Medicare and Medicaid Innovation under the Gene Therapy Access Model. These models included outcome-based agreements (OBAs), volume-based rebates, and guaranteed rebates over a six-year contract period, with scenarios accounting for different criteria related to vaso-occlusive events and treatment durability. Three-state Markov models were employed to compare the costs of standard-of-care (SoC) treatments with those of gene therapies, both with and without the proposed payment models. The findings indicated that gene therapies resulted in a negative cumulative balance, averaging -$2.11M for exa-cel and -$3.00M for lovo-cel per patient over six years compared to SoC. However, OBAs could potentially save Medicaid approximately $260K (UI $88K-$772K) per patient on average for exa-cel, and $367K (UI $122K-$1,111K) for lovo-cel. Volume-based and guaranteed rebates also showed potential savings, but the impact varied based on contract duration and the effectiveness of gene therapy.
Lessons Learned: The study found that achieving budget neutrality over six years is unlikely because the costs associated with the SoC are relatively low. However, innovative payment models could improve value-based spending by linking high therapy costs with potential health outcomes. The significance of real-world data was emphasized in identifying eligible patient populations and determining the actual costs of SoC. Furthermore, the analysis pointed out that the duration of contracts has a significant impact on financial outcomes.
Stakeholder Perspective: Colorado Medicaid.
Conference/Value in Health Info
2025-05, ISPOR 2025, Montréal, Quebec, CA
Value in Health, Volume 28, Issue S1
Code
IC1
Topic
Economic Evaluation
Topic Subcategory
Budget Impact Analysis, Cost/Cost of Illness/Resource Use Studies
Disease
SDC: Rare & Orphan Diseases