Getting personal: Health insurers welcome quality but fear extra costs

AIM's Philippe Swennen

AIM speaks on behalf of its members and acts as their link to governments, non-governmental organisations and stakeholders in the field of social and health services. AIM’s projects manager Philippe Swennen is responsible for evaluating innovations, such as telemedicine and disease management. He gives Science|Business AIM’s view of personalised medicine.

How your members do see the economic impact of personalised medicine?

There is no doubt those technologies will bring improvement to the quality of therapies and to patients’ lives. For that very reason, personalised medicine is highly attractive. However, when it comes to the economics, we can see only an increase of health costs associated with personalised medicine.

Why?

As soon as you introduce new diagnostic tests for a smaller target population, the economic logic points only toward cost increases. The research conducted to commercialise those new technologies has to be rewarded somehow. And with a smaller target population both at clinical trials level and patient level, you lose some of the scaling associated with one-size-fits-all drugs. Finding and testing drugs that are efficient for a smaller group of patients inevitably means a multiplication of researches and clinical trials. Those costs have to be paid by someone.

That’s maybe in the short term, during the introduction phase. But what about long term economic benefit?

Personalised medicine is likely reduce the costs associated with drug toxicity. Also, thanks to a better efficiency, it may lead to less time in hospital and a reduction in surgery. But there is a lot of controversy there. You find as many studies claiming a cost reduction as those pointing toward a cost increase. For AIM, we doubt the economic benefits will recoup the additional costs, even in the long run.

Did AIM conduct specific studies to evaluate the economic impact of personalised medicine?

No, we have not. But once again because it will be probably very beneficial for patients, we wish the promise of personalised medicine to be fulfilled. Simply, when it comes to healthcare cost reductions, we very much doubt that will happen.

Is the current model of reimbursement by insurers not an obstacle for personalised medicine adoption?

Not at all. Personalised medicine does not change the mutuality logic of not for profit healthcare insurance. Just because one subgroup of patients is better treated by a personalised drug, the overall risk of the total covered population doesn’t change. Therefore, personalised medicine does not change anything in terms of risk management for insurers. It will remain mutualised.