OBJECTIVES:

Outcome-based agreements (OBAs) have the potential to align incentives of payers and providers of therapeutics around patient and population health. Many barriers prevent their routine implementation, including contract design, data challenges, administrative burden, and the benefits/risks perceived by payers. We aimed to co-create a robust, systematic methodology for OBA design in partnership with the Welsh healthcare system to overcome existing barriers and succeed in a real-world setting.

METHODS:

IDEATE developed a methodology for OBA design focused on improving patient health outcomes. We facilitated workshops for outcomes, data, and contract design with a range of stakeholders including clinicians, pharmacists, commissioners, and data experts to build consensus on key parameters for the experimental OBA, including priority clinical outcomes. In parallel, we created a novel linked real world data environment for the analysis.

RESULTS:

Our iterative OBA methodology drives consensus-building across diverse stakeholders and successfully navigates many barriers of real-world implementation. Steps include: Assess medicine feasibility for OBA, Define the eligible population and outcomes for inclusion; Define how each outcome is measured and any sub-populations requiring separate measurements; Determine the outcome benchmark and metric used to assess performance; Define how the metrics are aggregated across strata and outcomes; Agree direction of payment flows from provider to payer; Define the term of the agreement and the period outcomes are assessed; Define proportion of payment that is subject to OBA outcomes; Define the formula to convert the performance metric into payment; and Agree provisions for contract parameter updates during the agreement.

CONCLUSIONS:

Trust and transparency proved key for effective collaboration and dynamic problem-solving. System readiness in Wales highlighted a unique environment to solve OBA barriers. Our cross-disciplinary and cross-organizational methodology is generalisable to a range of health interventions. Understanding cash flow across multiple years’ budgets needs additional research for a successful OBA.