Veterans Health Administration (VHA): The VHA is a federal healthcare entity funded by the Department of Veterans Affairs (VA). Around 1700 hospitals, outpatient clinics, counseling centers, and long-term care facilities provide care to active and discharged individuals from the armed forces. Although many individuals are eligible, demand exceeds capacity, so a priority system has been developed to provide care to those most in need. The VA health system is owned and operated by the federal government. 23
Military Health System (MHS): The MHS is a federal healthcare entity funded by the Department of Defense. This integrated healthcare system provides medical care in combat situations, overseas bases, and in the United States to active military and dependents. MHS, unlike the VA, is not a completely federally funded system and relies on a government insurance plan, TRICARE, which is managed by the Defense Health Agency. 23
Managed Care Organizations (MCOs): MCOs operationalize health insurance for their enrollees by providing a complete healthcare delivery system consisting of affiliated and/or owned hospitals, physicians, and other providers that provide a wide range of coordinated health services. These health organizations contract with insurers, or self-insured employers, to deliver healthcare.
Health Maintenance Organizations (HMOs): In this healthcare plan model, patients tend to have lower monthly premiums and “in-network” restrictions on primary care physicians. Sometimes, patients are required to select a single primary care physician for treatment. Specialists require referrals from the primary care provider and out-of-network services are not covered. Premiums and deductibles are often lower when compared to preferred provider organizations.
Preferred Provider Organizations (PPO): These health plans have a preferred network of providers but will still cover out-of-network care. Patients can see specialists without a referral from a primary care physician visit. Because these plans are less restrictive, patients tend to have higher monthly premiums and cost-sharing. These plans have lost some popularity due to efforts to control costs. Premiums and deductibles are often higher when compared to HMOs.
Tiered-Network Plans (TNP): Tiered networks can be considered a hybrid plan that combines the physician networks of an HMO and the expanded network options of a PPO. With a tiered network, members pay lower out-of-pocket costs when they visit a preferred tier provider. Patients can visit nonpreferred physicians for healthcare but will pay more out of pocket. Even if a patient visits a nonpreferred physician, the incurred out-of-pocket costs go towards the out-of-pocket limits established by the ACA.
Integrated Delivery Networks (IDN): IDNs utilize vertical integration of healthcare to deliver the full range of healthcare services to its patients. The major distinction of an IDN is that the healthcare providers covered by the health plan are also employees of the health plan, rather than contracted physician networks. When patients receive care in the outpatient, specialist, and inpatient settings, they will utilize services owned and provided by the health plan executor. Kaiser Permanente, on the West Coast of the United States, is a good example of this type of healthcare delivery system. 24
Pharmacy Benefit Managers (PBM): PBMs design, implement, and manage pharmacy benefits and coverage. Health plans and self-insured employers often partner up with PBMs and let the latter manage pharmacy-related insurance responsibilities.
Self-Insured Employers: In addition to the private health plan organizations listed above, many employers will choose to self-insure and fund their own healthcare plans for their employees. In this scenario, employers will contract with healthcare providers to administer their health plans but have full control of coverage options and total responsibility for costs. These self-insured employers are able to offer health plans tailored to their insured population and can serve as a cost-containment method. There is the risk, however, of high-cost individuals driving up overall costs to the employer, who maintains full responsibility for payment.
Third-Party Organizations
Academy of Managed Care Pharmacy (AMCP): A leading professional association dedicated to increasing patient access for affordable medicines, improving health outcomes, and ensuring the wise use of healthcare dollars. Members include practitioners who manage medication therapies served by health plans, PBM firms, emerging care models, and government.
Institute of Clinical and Economic Review (ICER): Since 2006, ICER has been an independent research organization that objectively evaluates the clinical and economic value of prescription drugs, medical tests, and other healthcare delivery innovations. ICER is best known as an independent pricing watchdog for the United States. Each drug report contains an analysis of economic value to establish a “value-based price benchmark” and recommends how drugs should be priced to reflect long-term patient outcomes and short-term budget impact appropriately.
Healthcare Provider Groups
Accountable Care Organizations (ACO): Groups of healthcare providers that agree to coordinate care and to be held accountable for the quality and costs of the services they provide. This is a shared risk and shared savings program. Medicare and Medicaid ACOs’ goals are to make sure patients get the right care at the right time, in order to avoid unnecessary duplication of services and preventing medical errors.
Patient-Centered Medical Home (PCMH): A care delivery model whereby patients’ treatment is coordinated through their primary care physicians. The objective is to have a centralized setting that facilitates partnerships between individual patients and their personal physicians. Care is facilitated by registries, information technology, and health information exchange to ensure that patients get the indicated care when and where they need and want it in an appropriate manner. 25
Decision Makers Interrelation Diagram
Figure 7. Interrelation Diagram of Key Healthcare Decision Makers in the United States
When looking at Figure 7, the process of value assessment must also be addressed. The MCO, PBM, CMS, and hospital organizations must make a coverage determination based on the evidence dossier submitted by the manufacturer after market approval by the FDA. A brief outline of these processes for drugs, devices, and diagnostics is described below.
Pharmacy and Therapeutics Committee (P&T): Develops and manages the formulary systems used in many different settings, ie, hospitals, long-term care facilities, Medicare, Medicaid, insurance companies, and managed care organizations. It acts as the liaison between pharmacy and medical staff in terms of coverage decisions for therapies that are effective, safe, and cost-effective for their particular facility or insurance plans.
Value Analysis Committee: Similar to a P&T Committee, these groups focus on the management of medical diagnostics and devices in a health system. Additionally, these groups also assess the value of certain clinical services to ensure the cost-effective provision of care.