Digital health is an emerging and rapidly developing field with the potential to increase the quality and efficiency of healthcare systems. The rise of digital health technologies (DHTs) has been driven by an increase in non-communicable diseases and a desire by patients to take a more active role in the management of their condition and is now being accelerated by the COVID-19 pandemic. DHTs have the potential to allow payers and manufacturers to track patient outcomes and adherence better, faster and more accurately, and hence support wider adoption of value-based healthcare models.
While there are several barriers to the evolution of DHTs, one of the key issues is funding. This is challenging because there are no dedicated access pathways or value assessment processes, and funding flows are driven in silos. DHT suppliers must therefore often battle with a fragmented marketplace with no clear route to market.
However, recent examples show that more national and local reimbursement systems are starting to tackle this issue, and the COVID-19 crisis is likely to act as a catalyst. The potential of DHTs has been observed during the COVID-19 pandemic, where the integration of digital technology into pandemic policy and response could be one of several characteristic features of countries that have better managed to flatten their COVID-19 incidence waves and maintained low mortality rates.
Market access challenges for DHTs
Currently there are limited requirements or standards for the development, authorisation, value assessment, pricing and reimbursement of DHTs. Companies attempting to launch DHTs face three major access and regulatory challenges resulting in an uncertain route to market.
1. Lack of standardised and dedicated value assessment
Emerging technologies such as DHTs will need new approaches to value assessment as currently there is little consensus on what defines value and a lack of clarity on evidence requirements. Manufacturers and payers should cooperate to develop a standardised, objective, rigorous and transparent process describing what evidence should be submitted and how it needs to be collected, depending on the indication and the device’s target.
Several countries worldwide are developing more standardised value assessment frameworks for DHTs but their progress varies greatly. In the US, the FDA created a Digital Health Center of Excellence to provide technical advice and advance best practices. In Japan, government initiatives like the Healthcare Innovation Hub support companies developing innovative devices to address the issues of an ageing society.
The situation is more complex in Europe where, for example, there remains a great deal of uncertainty in Italy but where a new, advanced approach has been developed in Germany with the Digital Healthcare Act. In countries with a degree of regional autonomy and lack of overarching national approach, interim solutions can be seen such as regional assessment of apps or regional level approaches being adopted on a national level. In the UK, for example, the National Institute for Health and Care Excellence (NICE) Medtech Innovation briefings aim to ease local decision-making by providing a factual overview but do not ultimately make recommendations; in Andalucia, Spain, apps can be awarded a quality seal and subsequently included in a database of recommended apps.
As the value assessment of DHTs becomes more standardised and transparent, the process will become easier to navigate. Manufacturers should become more targeted in their development and testing of DHTs, keeping in mind payer value drivers to increase the likelihood of reimbursement/coverage and achievement of a value-based price.
2. Evidence of DHT value at launch will inevitably be low
Reimbursement of DHTs is predicated on achieving quality outcomes against evidence-based standards, but health technology assessment (HTA) in this domain is embryonic and only now developing in line with the sector. HTA often adopts a strict adherence to the hierarchy of evidence, demanding that technologies be supported by evidence from robust, randomised controlled trials (RCTs). However, for many DHTs, there is uncertainty about their clinical and economic outcomes. Evidence from robust RCTs is often limited or unavailable at the time of launch as data covering medical device experience is routinely collected in the course of treatment through real-world evidence. Adopting anything like a pharmaceutical paradigm, based on an expectation of multiple RCTs being available at the time of launch, creates hurdles to access for many DHTs. Lack of confidence in clinical evidence at launch reduces the likelihood of reimbursement or coverage by public or private insurance and leads to payer reluctance to provide additional budget and higher price points.
Consequently, providers of DHTs should work with payers and clinical stakeholders to understand the best indication-specific approach to generate value evidence at launch, or in the real-world setting.
3. No dedicated reimbursement and funding pathways
Efforts to integrate DHTs have resulted in a mix of nationally run access schemes and regionally funded programmes. Access and coverage often vary by private and government payers within each country, depending on the healthcare landscape. Each payer is likely to have its own guidelines for DHT adoption. Even in the absence of a definitive policy, public as well as private insurers reimburse for DHTs only when there is a strong rationale for their use.
In the US, the Prescription Digital Therapeutics to Support Recovery Act aims to change Social Security to support the use of DHTs, and individual insurance plans roll out specific programmes like the digital health programme ‘Level2’ by UnitedHealth for type 2 diabetes patients. In Latin America, the situation is more complex due to the mix of private insurers and high share of patients paying out of pocket, but there are examples of public/private digital health partnerships aimed at supporting access to medical services in rural areas using DHTs. In Europe, funding sources for DHTs are country dependent: in the UK, the NHS England’s Innovation and Technology Tariff (ITT) and the Innovation and Technology Payment (ITP) are available at the national level and clinical commissioning funding at the regional level, whereas, in Germany, the Digital Healthcare Act allows doctors to prescribe health apps to patients which are reimbursed by the statutory health insurance.
Approved and reimbursed DHTs show that private insurers and hospitals are willing to reimburse apps when they provide value. From a public health perspective, a standardised reimbursement and funding pathway for DHTs needs to be created to encourage their development and appropriate utilisation; this need offers an opportunity for leadership from the industry.
Conclusion
Value assessment methodologies have been designed to support the evaluation of pharmaceutical products, but these are not well-suited to DHTs. Although progress is being made in some markets, there is a long way to go for market access pathways to become easier to navigate for DHT manufacturers.
It will take time to address these challenges but until these are resolved, financial constraints will continue to limit DHT-supported care for patients. In the meantime, we suggest leveraging the strategies below to boost the value perception of DHTs and mitigate possible objections:
Identify influential stakeholders and develop stakeholder engagement strategies; develop a robust evidence programme informed by up-to-date indication-specific payer evidence guidance; and explore and prioritise reimbursement pathways and opportunities.Eva Marchese is a vice president in the Life Sciences Practice of CRA based in London. Lorenzo D’Angelo is a principal in the Life Sciences Practice of CRA based in Munich. Anthony Barron is a principal in the Life Sciences Practice of CRA based in Brussels. The views expressed herein are the authors’ and not those of Charles River Associates (CRA) or any of the organisations with which the authors are affiliated.
Eva Marchese is a vice president in the Life Sciences Practice of CRA based in London. Lorenzo D’Angelo is a principal in the Life Sciences Practice of CRA based in Munich. Anthony Barron is a principal in the Life Sciences Practice of CRA based in Brussels.
The views expressed herein are the authors’ and not those of Charles River Associates (CRA) or any of the organisations with which the authors are affiliated.
