Managed Care - March 2008 - (Page B38) Chapter 4 Efficiencies in Management and Administration of Biologics Where more than one choice exists, the decision of which biologic therapy to use is sometimes driven by perceived efficiencies in drug delivery. In health care, however, one’s ‘efficiency’ may be another’s waste. This chapter describes factors that influence efficiency in health care, to offer the reader guidance in finding a balance among those factors. Medical resources are efficiently used when a given total expenditure cannot be reallocated to alternative kinds of care to achieve an improved medical outcome. — HENRY J. AARON, PHD, The Challenge of Rationing Health Care, 2005 Efficiency in health care is difficult to assess because perceptions of what is efficient vary, depending on whose interests are at stake. Achieving efficiency in health care is not simply a matter of achieving improved medical outcomes. In health care, efficiency is multidimensional. Moreover, just what is efficient depends on whose interests are at stake — making any assessment of efficiency in health care complicated when applied to biologics. Managing biologics effectively requires heeding all the factors that characterize efficiency in health care. In this chapter, we explain those factors in terms of types of efficiency. We pay particular attention to them in the context of mode of administration, a common proxy for efficient management of biologics. Understanding how each type of efficiency affects another can inform drug selection on the basis of mode of administration. In turn, this presents opportunities to keep health care benefits affordable and enable rational access to biologics. Aaron has identified 5 types of efficiency in the use of medical resources. Types of efficiency Aaron (2005) has identified five types of efficiency involved in health care resource use: medical, distributional, insurance, dynamic, and production (Table). It should be immediately obvious that full efficiency in health care through the application of all these criteria is elusive. The goal, then, is to achieve efficiency to the fullest extent possible by leveraging each of these types of efficiency to help patients, third-party payers, and employers gain the greatest possible benefit from a health care intervention. Many factors — benefit design and each party’s perspective on the value of biologics, to name two examples previously discussed in this monograph — can affect the degree to which these types of efficiency can be achieved. Approaching full efficiency, then, requires an understanding of how one type of efficiency can affect another. This is especially true when applied to the administration of biologics. Medical efficiency. Simply put, medical efficiency occurs when one health care intervention results in greater clinical benefit than another intervention or by doing nothing at all. For example, a benefit design that allows access to a variety of biologic products can promote medical efficiency, while a design that limits access to certain biologic products on the basis of their mode of administration can, in some instances, run the risk of attenuating medical efficiency. In cases where a clinician has a choice of two or more biologics that work in similar fashion, some MCOs have begun to designate preferred products. This is 38 BIOLOGIC THERAPY MANAGEMENT
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