Evidence: Vital but Seldom Used Consistently by Payers

March 3, 2020
Dan Leonard, President

CEO, National Pharmaceutical Council

Specialty Pharmacy Times, February 2020, Volume 3, Issue 1

Peer-reviewed research conducted by the National Pharmaceutical Council (NPC) and the Center for the Evaluation of Value and Risk in Health at Tufts Medical Center over the past 2 years sheds some light on what’s behind discrepancies in coverage decisions from one insurer to the next.

Patients may have noticed that some health insurance plans cover their specialty medications, while others do not. For patients switching between insurers or employers, these differences in coverage can potentially disrupt their care, especially for people living with chronic conditions.

Peer-reviewed research conducted by the National Pharmaceutical Council (NPC) and the Center for the Evaluation of Value and Risk in Health at Tufts Medical Center over the past 2 years sheds some light on what’s behind the discrepancies in coverage decisions from one insurer to the next.

The first study, published in 2018,1 found that insurance coverage and reimbursement for specialty medications varied substantially, with only 15.9% of drug coverage policies consistent across the largest United States commercial health plans. Less than half of all coverage decisions were similar across the majority of the health plans reviewed.

Of the 3417 coverage decisions evaluated, 38% of coverage decisions imposed restrictions or excluded the medication from coverage. More specifically, the study showed that payers implement several types of restrictive policies that limit access to specialty medicines. These restrictions include using step edits, in which a treatment must be proven ineffective before the plan will cover other therapies; restricting use of a medicine to certain groups of patients; and limiting the types of physicians who can prescribe the treatment. These kinds of restrictions force physicians to tailor care not only to diverse patients, but also to the multiple insurance plans that provide health care coverage.

Differences and restrictions in coverage policies are expected across health plans. Plans differ in their goals, budgets, state or insurance regulations, and even plan membership—potentially impacting which services or medications to cover. However, noting the inconsistency of coverage policies for specialty medicines, the researchers explored what might be driving those variations.

In their next study, the NPC/Tufts team examined a potential factor: the use of evidence by payers to inform those same coverage decisions. They found that only 15% of coverage policies cited the same study evaluating a specific drug for a specific indication. For example, the most commonly cited study was a randomized controlled trial (RCT) of ipilimumab for metastatic melanoma, which was cited by 11 of 16 plans that issued a coverage policy for the drug and condition pair. In contrast, a significant real-world evidence study of omalizumab for severe asthma was cited by only 1 of 17 plans that issued a coverage policy for that medicine and its specific use.

While it is not surprising that not all studies were cited by all plans, only 38% of all studies were cited by more than 1 plan. Underlying this inconsistency, the quantity of evidence used varied widely, from an average of 4.2 studies cited to an average of 64.4 studies. Across all plans, on average 17.4 studies were cited in each coverage decision.

The researchers also looked at the types of evidence cited in coverage decisions: economic evaluation, evidence synthesis, randomized controlled trials, evidence synthesis, and other clinical studies. Researchers found some plans relied predominantly on randomized controlled trials to inform formulary coverage. Other plans used a full range of evidence, including real-world evidence, evidence synthesis, and economic studies. To understand real-world experience among more diverse patient populations, address expected treatment in usual care settings and typical provider networks, or demonstrate the impact of treatments on measures often not evaluated in traditional clinical trials, such as improved quality of life, work productivity, or the effect on caregiver burden support. The full range of evidence is needed.

Some variation in the evidence that plans report reviewing is expected, but the extent of variation in the volume, composition, and consistency of the cited evidence is notable and may be a key factor behind the inconsistent coverage that patients encounter. The full results of the second research study were published in Health Affairs2 in November 2019.

Restriction or exclusion of specialty medications has key implications for patients. Treatment decisions may be driven by what health care coverage patients have, rather than by the physicians who know what kind of care is needed. These coverage decisions should be based on a complete review of the comprehensive set of evidence using accepted methods to assess the quality and certainty of evidence. Best practices adopted by the payer community and professional bodies outline the need for formulary decisions and the documents used to inform the committee decisions to be neutral, objective, and based on scientific evidence, and should include broad types of evidence to inform decision-making.3-5

There are potential solutions, such as following the recommended best practices for the conduct, and deliberations of Pharmacy and Therapeutics (P&T) committees that were developed at a cross-functional forum led by the Academy of Managed Care Pharmacy.6 The resulting recommendations focused on several key areas, such as improving training and education for P&T committees, particularly in how to evaluate real-world evidence and observational studies through the use of decision-making tools, such as the GRACE (Good ReseArch for Comparative Effectiveness) checklist, and the CER Collaborative, for which NPC is a partner.7,8

The recommendations also included providing transparency of the rationale for formulary decisions, ensuring broader representation from patients and other relevant stakeholders, and considering a wider range of evidence, including real-world evidence. Addressing all of these areas can help drive more consistent use of evidence.

Comprehensive, and consistent evaluation of evidence is needed, and inclusion of real-world evidence is critical, to ensure patient appropriate and evidence-based access to specialty medicines.


  • Chambers JD, Kim DD, Pope EF, Graff JS, Wilkinson CL, et al. “Specialty Drug Coverage Varies Across Commercial Health Plans in the US.” Health Affairs 37, No. 7(2018):1041—1047.
  • Chambers JD, Panzer AD, Pope EF, Graff JS, Neumann PJ. “Little Consistency in Evidence Cited by Commercial Plans for Specialty Drug Coverage.” Health Affairs 38, No. 11 (2019): 1882-1886.
  • American Society of Health-System Pharmacists. ASHP Statement on the Pharmacy and Therapeutics Committee and the Formulary System. 2012. https://www.ashp.org/-/media/assets/policy-guidelines/docs/statements/pharmacy-and-therapeutics-committee-and-formulary-system.ashx.
  • National Committee for Quality Assurance. Health plan accreditation updates 2020 overview. 2018. https://www.ncqa.org/wpcontent/uploads/2018/11/20181102_Health_Plan_Accreditation_HPA_2020_Updates_Overview.pdf
  • Centers for Medicare & Medicaid Services. Medicare Prescription Drug Benefit Manual. https://www.cms.gov/Medicare/Prescription-Drug-Coverage/PrescriptionDrugCovContra/PartDManuals.
  • AMCP Partnership Forum: Principles for Sound Pharmacy and Therapeutics (P&T) Committee Practices: What’s Next? JMCP. 2020:26(1):48-53.
  • Dreyer NA, Velentgas P, Westrich K, Dubois R. The GRACE checklist for rating the quality of observational studies of comparative effectiveness: a tale of hope and caution. J Manag Care Spec Pharm, 20 (2014), pp. 301-308.
  • Berger ML, Martin BC, Husereau D, Worley K, Allen D, Yang W, et al., On behalf of the, ISPOR-AMCP- NPC. Retrospective Prospective Observational, CER Task Forces. A questionnaire to assess the relevance and credibility of observational studies to inform health care decision making: an ISPOR-AMCP-NPC good practice task force report Value Health, 17 (2014), pp. 143-156.