As the Chief Medical Officer for Highmark Inc. and having been on the health insurance side of medicine since 2008 while actively practicing rural family medicine in Kentucky, I have seen the effect chronic diseases can have on healthcare delivery. From a patient perspective, pain and reduced ability to ambulate cause a reduced quality of life (QOL), which is never acceptable. From a provider perspective, the ability to effectuate a change on many chronic diseases is limited at best. From both a payer and society’s perspectives, the effect of chronic disease is profound. Its effects are felt economically from days of lost work, and treatment costs of medication and interventions. I will focus this discussion on osteoarthritis (OA) from a payer’s perspective.

Patients with OA often require frequent medical attention with medication, diagnostic tests such as radiographs, physical therapy, pain management, and, less frequently, surgical intervention. The direct medical costs associated with OA are substantial and are taken into account by the payer industry. Health insurance companies prioritize diseases for review on an annual basis through a systematic process that involves various factors. Although the specific methods can vary between insurance companies, there are some common themes used across the industry. By evaluating diseases using established diagnostic criteria and considering a combination of medical, economic, and social factors, health insurance companies can make informed decisions about coverage, treatment options, and healthcare services for their policyholders.

Insurance companies assess the prevalence of diseases within their policyholder population. Diseases such as OA that affect a significant portion of the insured population and have a substantial effect on health outcomes are often prioritized. Looking at just the prevalence of the disease would not suffice in a company that has a fiduciary responsibility not only to their stakeholders but also to the members (patients) who pay the premiums and to companies that hire the payer to administer the benefits they purchased for their employees. It is every branch of the healthcare system that must remain responsible for the total cost of care. The trick is to do this all while making sure our members are getting the right care at the right time and at the right level.

Insurance companies conduct cost-benefit analyses to determine the financial impact of covering specific diseases. These analyses assess the potential costs of treatments against the anticipated benefits in terms of improved health outcomes and reduced overall healthcare expenses. Since funds are not unlimited, it is necessary to carefully prioritize financial resources and review expenses. Diseases with high treatment costs, especially those involving expensive medications, surgeries, or therapies, are carefully reviewed on at least an annual basis for accuracy and impact. Insurance companies must frequently review diseases that contribute significantly to healthcare expenses. Chronic diseases such as OA that require long-term management and have a high impact on patients’ QOL, both physically and economically, are usually prioritized. Healthcare payers have responsibilities outside of economics as well. They also monitor emerging diseases or health threats, such as new infectious diseases or drug-resistant conditions. Rapid response to emerging health issues is crucial to protecting policyholders. Therefore, priority is often given to impactful global events, such as the most recent public health emergency with the coronavirus disease (COVID-19) pandemic. Insurance companies may align their coverage priorities with broader public health goals and often take guidance from local, state, national, and international authorities. These authorities are often public health officials making recommendations based on need and predictive analytics, but they could also be mandated by governments for reasons far removed from medical decision making.

Outside of the economic influence, we address clinical needs in terms of diagnosis and treatment for OA. Payers often refer to established clinical guidelines from reputable medical organizations such as the American College of Rheumatology and Osteoarthritis Research Society International. This is where evidence-based medical input enters the policy decisions of what is and isn’t covered in the plan. Insurance companies typically require robust and comprehensive data from clinical researchers to make informed funding decisions for managing OA. By providing health insurance companies with well-documented and peer-reviewed data in these areas, clinical researchers can contribute significantly. Of value are data that demonstrate both clinical effectiveness and cost-effectiveness. Detailed results from well-designed clinical trials, including the methodology, patient demographics, intervention techniques, and outcomes measured, are key to the review process. Many companies often bring new drugs or devices to the insurance industry with a prepackaged presentation. These presentations, although flashy and robust, often lack the raw data needed for the medical policy teams to do the deep dive necessary for the vetting process. However, the presentation is helpful to see what the manufacturer thinks is most important to them and the industry, and it also gives us insight into how they interpret data. Nonetheless, we require a thorough perusal of the data by the internal teams. We, on the payer side, employ clinical trial researchers, physicians, pharmacists, and research nurses to go over the data with a fine-tooth comb. There have been several times when a novel drug was being introduced to the market and gained much momentum with social and mainstream media hype, to the point where coverage seemed inevitable. During the vetting process, it was discovered there was a dosing error in the clinical trial barely footnoted by the manufacturer and not revealed (although never denied) publicly. This finding led to an eventual no-coverage decision by many payers.

The types and amount of data also affect coverage decisions. Long-term studies provide valuable insights into the sustainability of OA treatments over time, therefore holding more weight in the decision-making process. Of course, comparative studies that evaluate the effectiveness of different treatments and interventions are always welcome. However, the comparator is often placebo or some other nonintervention. This poses a problem because it would be better to compare it to the drug or device they are looking to replace in the coverage tree. This would help understanding of the efficacy of a new treatment relative to the existing treatment. Insurance companies are interested to know which interventions provide the best outcomes for patients, so if a new treatment has similar effects as the existing treatment, it may not be covered or only partially covered.

What the industry looks for is research that assesses the economic impact of OA treatments, including cost-effectiveness analyses. This helps insurance companies understand the economic implications of funding specific treatments. It is worth keeping in mind that we must all be good stewards of the healthcare dollar so that access and quality are available to all that need care. In line with this, a large part of the economic impact analysis should include patient-reported outcomes (PROs) for OA. These PRO data provide insights into how treatments affect patients’ daily lives and functionality. No matter how good the science and the economics appears, if patients don’t like or won’t use the treatment, then it all becomes a moot point. Information directly from patients about adherence to using the treatment and their symptoms, QOL, and overall well-being become key metrics that are so often missed by bench-to-bedside researchers.

As an extension of this point, another critical metric is real-world data on OA. This often happens downstream from the laboratory data and outside of the clinical trial and takes a longer time. As a result, the drug or device manufacturers do not commonly have this when they present to insurance companies. Real-world evidence provides the insights needed by the industry into how OA treatments work in diverse patient populations and clinical settings. This part of the report should also include any adverse event data found during the study. What is the risk-benefit ratio of the new treatment? Insurance companies need to assess the safety profile of interventions to make funding decisions. For example, should an innovative lifestyle medicine approach for OA show efficacy, it would be important, at a later date, to have data on implementation efficacy in different areas of the country and clinical settings.

Specific to OA research, the industry looks at some other important and often groundbreaking key factors. Summaries of existing research studies that provide a comprehensive overview of the available evidence become crucial in this type of long-studied and chronic disease. Metaanalyses help insurance companies understand the overall effectiveness and safety of treatments. The field of precision medicine has made its way to the heart of OA treatment as well. Research on biomarkers associated with OA progression or treatment response is growing ever more important as the next generation of treatment and prevention. Biomarker data can aid in identifying patients who are more likely to benefit from specific treatments. These data allow insurance companies to decide coverage based on precise predictive tests, rather than step therapy and progressive treatment marked by failures before moving on to a more expensive and effective treatment.

Finally, studies assessing how OA and its treatments affect the overall QOL for patients are the key to prioritizing the importance of coverage decisions. These decisions, not only crucial for understanding the holistic effects of interventions, also indirectly affect the funding available for the research. This may be the most important side effect of the industry’s prioritization decisions: If insurance companies do not feel it is important and do not see the need for coverage of new treatments, the money will not flow to research in that field. By analyzing these types of data, insurance companies can make more informed funding decisions, ensuring they support treatments and interventions that are effective, safe, and economically viable for managing OA. Addressing these challenges requires a multifaceted approach, involving collaboration with healthcare providers, leveraging technology for efficient processes, focusing on preventive care and patient education, and staying updated with evolving healthcare policies and practices.

In summary, the overall impact of OA is substantial, encompassing direct healthcare costs, lost productivity, financial burden on individuals and families, and broader societal costs. Effective strategies for managing and preventing OA can help mitigate these economic consequences. Managing OA is significant for health insurance companies due to its impact on healthcare costs, patient outcomes, and overall business sustainability. Effective OA management can lead to cost savings, improved patient satisfaction, and a competitive edge in the insurance industry. The choice of health plan or policy for OA management depends on individual preferences, healthcare needs, and financial considerations. Understanding the coverage and limitations of each plan is crucial for individuals seeking effective OA management while minimizing out-of-pocket expenses. Analyzing the cost-effectiveness of various OA management approaches is essential for healthcare providers, insurance companies, and policymakers to make informed decisions. Different management strategies may have varying upfront costs, but their long-term benefits, including improved patient outcomes and reduced healthcare expenses, must be considered.