The National Health Service’s NICE and ICER’s Model in the US
The advent of biologic drugs has provided new opportunities to tackle rare and complex health conditions, significantly improving patient health outcomes and giving hope to patients who until now had few effective treatments available. Despite these advancements, patients are increasingly being denied access to life-saving and life-extending treatments by unelected bureaucrats whose chief concern is cutting costs to the national purse.
The National Institute for Health and Care Excellence or ‘NICE’ as it is known, is a non-departmental public body of the Department of Health in the United Kingdom. Established in 1999 by the Labour health minister Frank Dobson, it provides seemingly expert and independent advice on which medicines and treatments Britain’s state-run National Health Service (NHS) will fund. However, in reality, it is a thinly veiled attempt at justifying often-questionable political and ethical decisions. For as the journalist Stephen Pollard has observed it is “not so much Nice as Nasty – Not Available, So Treat Yourself.”
Tasked to serve a nationalized health system that increasingly focuses on cost containment and demand management, NICE is known for widespread rationing and the exclusion of all manner of life-saving medications and treatments. Often denying drugs that can save or prolong life, its panel of medics, academics and officials have come under sustained criticism for imposing arbitrary limits on the amount of money the state will spend on treatments. Since its inception, its recommendations have excluded many from receiving the high-quality medicines they would benefit from.
Today, NICE has the power to issue binding guidance to NHS clinicians concerning which treatments the state will and will not allow. Driven by the methodology of the Quality Adjusted Life Year (QALY), the system now imposes a uniformity of rules based on the ‘top down’ calculation of how many additional years and quality of life will be delivered from a particular medicine or treatment. Behind closed doors, the current price calculation for the NHS approving a drug is set at £30,000 per QALY - irrespective of a person’s actual needs.
In the US, the Institute for Clinical and Economic Review (ICER) is seeking to advance a similar approach. A Boston-based not-for-profit organization quick to promote the notion of its own independence, it nevertheless aims to channel healthcare value in a set direction by providing public stipulations on clinical and cost effectiveness treatments, tests, and procedures. Founded in 2005 by physician and researcher Steven Pearson, since 2014-2015 it has started to promote a number of drug evaluations. Operating in a similar manner to NICE, ICER ultimately appoints unelected and secretive panels of experts to rule on the cost effectiveness of an expanding range of treatments.
However, should the US incrementally grant formal credence to such an approach then it would also succumb to the outcomes debacle of the UK. As a result of such an approach, NICE’s patients in the United Kingdom are now worse placed than others in Europe. In France, bowel cancer patients are prescribed Bevacizumab. In France and Spain, breast cancer patients are 50 percent more likely to receive the drug Herceptin while in the UK NICE is recommending at best the prescription of these drugs is restricted and at worst they are not prescribed at all. In 2000, in NICE’s first full year of operation, no drugs were denied. However, by 2009, the number of exclusions had climbed to 29 percent.
The NHS recently axed drugs treating prostate, cervical, bowel and breast cancers in addition to muscular dystrophy. NICE even denied a 6-year-old boy access to a treatment for muscular dystrophy because it was deemed “too costly.”
ICER President, Steve Pearson served as a senior fellow with NICE and has praised nationalized health care for enabling demand management through blanket price controls. Whilst it is perhaps no wonder that ICER’s default position is too ideologically assume that new and innovative drugs are too expensive and that pharmaceutical profits are unnecessary, the organization is nevertheless starting to have a similarly detrimental impact on drug formularies in the US. Increasingly acting as an asset for insurers and Pharmacy Benefit Managers (PBMs), ICER is starting to provide a production line of justifications aimed at excluding key drugs from the choices of doctors and patients.
Advancements in specialty drugs not only significantly improve patient health outcomes but longer-term they can reduce healthcare costs for the nation. For example, in 2014 a study in Health Affairs found that while specialty drugs often cost more than traditional drugs, they carry greater benefits and deliver greater value for the money over the longer term. Significantly, the study found that specialty drugs offer better quality and quantity of life lived than traditional and often cheaper drugs.
Likewise, a Stanford University-led study published in October 2014 found that if new hepatitis C drugs were used to cure all 500,000 prisoners in the US who have the disease, taxpayers could save approximately $2 to $5 billion. While the short-term costs for Sovaldi treatment were higher than alternatives, over the longer-term, the drug was worth the cost because patients were generally cured, rather than just treated.
Yet despite the long-term societal cost savings of many specialty drugs, ICER and its allies default to providing public justification to entities looking to avoid paying for high-quality customer treatments. And they are doing so often through public reports on drugs that are released near the time of Food & Drug Administration approval. Ultimately, these reports are helping to take choices away from doctors and patients and come with long-term price tags.
Drug rationing bodies such as NICE in the UK and ICER in the US should be viewed with suspicion by anyone who believes that doctors and patients should retain their right to choose the best course of treatment. In placing short-term cost savings over longer-term effectiveness, such price watchdogs not only downplay the utility of new medications but also impose costly restrictions and destroy life-enhancing freedoms.