Notice of Funding Opportunity: State’s use of QALY-Based Cost-Effectiveness Reports to Inform Medicaid Coverage for Prescription Drugs

Skip to Page Content

State’s use of Quality Adjusted Life Year (QALY) Based Cost-Effectiveness Reports to Inform Medicaid Coverage for Prescription Drugs

Background and Statement of Problem

The QALY is a broad population-based cost and cost-effectiveness analyses developed by health economists to measure and compare the benefits of healthcare interventions for cost effectiveness which is used to allocate health care resources. The use QALYs in health-care coverage decisions, rather than metrics that consider specific patient needs and heterogeneity, have resulted in discrimination against people with chronic illnesses and disabilities because QALY-based metrics often conclude that the treatments they need are too expensive, resulting in delayed, restricted, and denied healthcare.

There are serious ethical concerns with how QALYs are developed and used. QALYs fall short in measuring health preferences for patients with chronic diseases and disabilities and place greater value on years lived in full health, or on interventions that prevent loss of perfect health while discounting gains in health for individuals with chronic illnesses. QALYS require valuing one individual’s life over another’s, which may result in only providing healthcare to those that are deemed to have the greatest benefit from a treatment, such as a person who will fully recover and return to perfect health. Additionally, people with disabilities may enjoy a comparable quality of life to non-disabled individuals but may face a shorter life expectancy compared to someone without their condition. Because QALYs are assigned by both quality as well as quantity of life, an incremental QALY assessment would prioritize providing treatment to a nondisabled person with a longer theoretical life expectancy over a person with a disability.

NCD’s recent report, Quality Adjusted Life years and the Devaluation of Life with a Disability described the history of QALY use by states, beginning with Oregon’s use of QALYs to determine what services would be covered by their Medicaid program. In 1992, the U.S. Department of Health and Human Services (HHS) rejected the state of Oregon’s request to proceed with their prioritized list based on explicit cost-effectiveness ratios derived from QALYS because of its potential to discriminate against people with disabilities. The Secretary of the Oregon Department of Health and Human Services wrote an opinion to the New York Times stating, “Our principal concern is that Oregon's plan in substantial part values the life of a person with a disability less than the life of a person without a disability. This premise is discriminatory and inconsistent with the Americans with Disabilities Act.” 

NCD’s report also found that New York has recently relied on QALY-based cost effectiveness reports by the Institute for Clinical and Economic Review (ICER) which led to a “stand-off” between the Medicaid agency and the drug manufacturer over the price the state would pay for a new a critical treatment, leaving patients waiting and using a less effective alternative. Despite the civil rights implications of using these reports, a 2020 Kaiser Foundation report, identified twenty-two states that used ICER and other cost effectiveness reports to value prescription drugs and treatments.  Several states have also shown interest in relying on international drug prices to inform Medicaid prescription drug coverage in their Medicaid programs.

Report Purpose

This purpose of this report is to follow up on NCD’s report, Quality Adjusted Life years and the Devaluation of Life with a Disability, with regard to State’s use of ICER’s QALY-based cost-effectiveness reports  or international drug prices to inform coverage of prescription drugs in their Medicaid programs.

It will describe how many States are using ICER QALY-based cost studies or referencing international prices; how this information is being used, e.g., as a benchmark or cost-threshold, and if this has resulted in restricted access to prescription drugs. The report will gather evidence that that shows whether reliance on this information is delaying access to or denial of coverage of necessary drugs and treatments for chronic illnesses. It will also describe methodological alternatives to QALYs that consider patient values and preferences. It will make findings and make specific recommendations to Congress, federal government, and states to address the findings.

Research Questions

Through the lens of section 504 and the ADA, the research will seek to answer:

  1. How many states use ICER QALY-based cost studies or reference international drug prices set in reliance on the QALY to determine prescription drug prices for Medicaid? How much does it influence coverage of drugs and services in the Medicaid program? Negotiations with manufacturers?
  2. Has patient’s access to prescription drugs resulted?  Describe the impact on access.  
  3. What are the most highly regarded alternatives to QALY-based cost studies that consider patient values and preferences? Do any measure cost-effectiveness? What is the impact of these alternatives on access to prescription drugs?
  4. Has HHS accepted or rejected Medicaid plans from States that identify reliance on ICER reports or international drug prices to determine coverage of prescription drugs? If plans have been accepted, what states and what limitations are in these plans?

Time Period

Six months

The deliverables for this project will include:

A detailed preliminary framing paper.

A revised framing paper incorporating input from NCD Council members and staff.

A first draft report incorporating initial findings, conclusions, and recommendations that can be drawn from the examination.

A final report of no more than 80 pages (not including endnotes or appendices) incorporating input from NCD Council members and staff. Final reports must contain an executive summary with key findings and key recommendations; and specific sections on methodology; all findings; and all recommendations, organized according to the entity to which they are directed. 

A brief “Report Highlights” document for each report that succinctly and in plain language encapsulates the report’s scope and purpose, major findings, and recommendations, and contains a link to the full report at the bottom. For an example of a Reports Highlights Page, refer to: https://ncd.gov/publications/2013/10242013.  

Requirements

Pursuant to Executive Order 14005, NCD will only consider proposals from individuals or entities based in the United States.

Research must, in part, rely on data gathered from a newly established site that tracks State’s activity on use of ICER reports. NCD will provide further information on this specific resource after an award is made but use of this resource should be included as part of the research methodology in submitted proposals.

Any methodology used to obtain stakeholder input must allow for open-ended discussions between stakeholders, as opposed to soliciting answers to specific, predetermined questions. While the use of data from existing surveys is permitted, conducting surveys for purposes of this study is strongly discouraged. The inclusion of people with disabilities must be integral to the planning, development, and execution of this project.  The report should also reflect NCD’s view that the disability community is heterogeneous, with diverse needs and perspectives, and those perspectives should be included.

The awardee is responsible for reasonable accommodations at any meetings, events, forums, focus groups, etc. (i.e. sign language interpreters, CART reporters, and other such providers, as well as documents or other materials that are made available in public forums), associated with this agreement. If NCD hosts any events related to this project, it will be responsible for providing accommodations.

The awardee will present on the report before NCD at a quarterly Council meeting and must factor travel expenses into the proposed budget.

The report drafts must adhere to NCD’s editorial requirements which will be provided upon award of the cooperative agreement. Final drafts must be professionally edited before they are submitted to NCD.

Eligibility Information

All potential applicants are eligible to apply.

Cost-sharing is not required.

Other Eligibility Criteria:  Proposals that merely offer to conduct a project in accordance with the requirements of the government’s scope of work will not be eligible for award.  You must submit an explanation of the proposed technical approach in conjunction with the tasks to be performed in achieving the project objectives.

This solicitation does not commit the government to contract for any work or services whatsoever. Respondents are advised that the Federal Government will not pay for any information or administrative costs incurred in response to this solicitation notice.  All costs associated with responding to this solicitation notice will be solely at the responding party’s expense. It is the responsibility of the interested parties to monitor grants.gov and ncd.gov sites for additional information.

Number of Awards

NCD expects to make 1 award with an anticipated funding amount of $65,000.

Due Date and Email address for Proposals

July 20, 2021, 5:00 p.m. eastern time

Email Word and PDF versions of technical and business proposals to atorresdavis@ncd.gov

Proposal Information and Instructions

Proposals must be submitted in two parts: A 'Technical Proposal' and a 'Business Proposal. Each part shall be separate and complete so that evaluation of one may be accomplished independently of the other. The technical proposal must not contain reference to cost; however, resource information, such as data on labor hours and categories, materials, subcontracts, etc., must be contained in the technical proposal so that the offeror’s understanding of the scope of the work may be evaluated. It must describe the offeror’s technical approach in sufficient detail to provide a clear and concise presentation that includes, but is not limited to, the requirements of the technical proposal instructions.

Proposals must be signed by an official authorized to bind the submitting organization/s.

Alternate proposals or proposals which deviate from the requirements may be submitted; if they address the requirements in the statement of work, and if overall performance would be improved or not compromised and are in the best interest of the Government. Alternate proposals, or deviations from any requirements of this funding opportunity, must be clearly identified.

NCD will evaluate proposals in accordance with the evaluation criteria set forth in this solicitation.

The winning proposal submitted in response to this solicitation will become part of the cooperative agreement.

A detailed work plan must be submitted indicating how each aspect of the statement of work is to be accomplished. The technical approach should contain as much detail as necessary to fully explain the proposed technical approach or method. The technical proposal must reflect a clear understanding of the nature of the work being undertaken.

The technical proposal must include information on how the project is to be organized, staffed, and managed. Information must demonstrate an understanding and describe the management of important events or tasks. The technical proposal must explain how the management and coordination of consultant and/or subcontractor efforts will be accomplished.

The technical proposal must include a list of names and proposed duties of the professional personnel, consultants, and key subcontractor employees assigned to the project. Their resumes must be included and should contain information on education, background, recent experience, and specific requirement related or technical accomplishments. The approximate percentage of time each individual will work on the project must be included. The proposed staff hours for each of the above individuals must be allocated against each task or subtask for the project.

The technical proposal must provide the general background, experience, and qualifications of the organization. Similar or related contracts, subcontracts, or grants should be included and contain the name of the customer, contract or grant number, dollar amount, time of performance, and the names and telephone numbers of the contracting officer’s representative or project officer and contracting/grants officer.

The technical proposal must contain a discussion of present or proposed facilities and equipment which will be used in the performance of the contract.

The technical proposal must contain a proposed timeline for deliverables and a “deliverables and payment schedule” chart. Payments will be based on 3 deliverables - with the last payment occurring after NCD approval of the final draft of reports.

Format of Technical Proposals

1. Abstract (no more than 2 pages)

A two-page summary shall be provided abstracting the proposal contents (e.g., objectives, activities, expected outcomes) in language understandable to an informed layperson. The narrative should be limited to no more than 250 words.

2. Table of Contents

3. Introduction (no more than 20 pages)

Offerors shall summarize, in their own words, the purposes and objectives of the project to demonstrate their complete understanding of NCD’s intent and requirements. This section also should contain a specific statement of any interpretations, questions, qualifications, limitations, deviations, or exceptions to the scope of work and the extent to which the offeror’s proposal can be expected to meet the requirements set forth in the scope of work.

4. Procedural Plan (no more than 30 pages)

This section shall fully describe the theoretical and technical approaches the offeror will employ in complying with each task in the scope of work. While a general statement of strategy is appropriate, the offeror shall be specific in describing the way the overall review will be conducted, and the intended approach to the design.

Contain a proposed timeline and deliverables schedule that will be used to guide the conduct of the study and monitor the work.

5. Management Plan and Schedule (no more than 10 pages)

The management plan shall show the feasibility of implementing the offeror’s resources. The offeror shall present a time chart that specifies the amount of time (in person days) each staff member will commit to implementing each task. The plan shall present a clear description of the working relationships among personnel. Finally, the plan shall contain a method for insuring the timely and successful completion of each work task.

6. Personnel

Personnel with major responsibilities shall be listed by name, title, position, academic background, relevant experience, responsibilities with the project, and the extent to which this commitment is assured. This section should include specific time commitments of staff to other projects, both Federal and non-Federal. Consultants who have agreed to serve on the project should be similarly identified and assurances of their commitment included. The Project Director shall be committed for no less than approximately 60 percent of the cooperative agreement. Vitae for all principal personnel, including consultants, should be appended to the proposal. Each curriculum vitae should be limited to not more than two (2) pages and should emphasize areas of experience directly relevant to this work statement.

7. Organization Experience

This section shall describe the offeror’s pertinent experience and qualification in conducting work of a similar nature. Offerors shall offer evidence of not more than 5 previous related assignments, including the names and telephone numbers of client project offices who would be able to comment on the offeror’s performance of those assignments. Summaries (not to exceed one page) of related work shall be included. References to products resulting from these related activities shall also be included.

8. Resources/Facilities/Equipment

This section shall identify those resources (other than personnel), facilities, and equipment (e.g., library holdings, computer hardware, and software) available for use in conducting this project. Offeror should address accessibility for people with disabilities.

9. Current Contractual Obligations

Each offeror will be required to outline both federal and non-federal contractual obligations existing during the time period of this award for all projects involving personnel who will be assigned to this project. Such organizations/agencies must be identified by name and the percentage of work time allotted to these projects by personnel committed to the proposed project must be provided.

10. Issues and Associated Data Items

When responding to the tasks and when identifying what should receive emphasis, careful consideration should be given to the issues identified, their associated data items, and the statement of products desired in the final reports.

All information provided by NCD must be returned to NCD upon completion of the analysis and no later than 10 working days after the completion of the cooperative agreement. The information may not be reproduced or released without the prior written permission of NCD.

11. Rights in Data, Copyright, and Disclosure

a. Data – The term data as used here includes written reports (progress, draft, and final), electronic format and work of any similar nature that is required under any resulting Cooperative Agreement to perform this project.  It does not include the awardee’s financial reports, or other information incidental to awardee administration. Data submitted to and accepted by the NCD under the cooperative agreement shall be the property of the NCD, and NCD shall have full and unlimited rights to use such data for any purpose in whatever manner deemed desirable and appropriate, including making it available to the public. Such use shall be without any additional payment to the awardee. Data may be published as the property of NCD without giving authorship to the awardee.

b. Copyright – The awardee relinquishes all copyrights and/or privileges developed under the cooperative agreement. The awardee shall not include in the data any copyrightable matter without the written approval of NCD unless the awardee provides NCD with the written permission of the copyright owner for the NCD to use the matter.

c. Disclosure – The awardee agrees not to divulge or release any information, reports or recommendations developed or obtained with the performance of any cooperative agreement with NCD, and not otherwise available to the public, without the prior approval of the NCD.

d. Final approval of deliverables

All final deliverables are the product of NCD and require acceptance and approval by NCD. NCD reserves the right to make substantive edits to all deliverables.

12. Award Information

NCD will make an award to the responsible offeror(s) whose proposal conforms to the solicitation and is most advantageous to the Federal Government.

Upon notification of intent to award, the offeror will be expected to consult with NCD to:

Finalize a mutually agreeable timeline and deliverables schedule that will be used to guide the conduct of the study and monitor the work;

Develop a payment schedule chart to be used for installment payments of the award based on 3 deliverables;

Meet with select NCD staff and board members at a pre-award meeting.

13. Reporting

Throughout the project, the awardee and NCD Contracting Officer’s Representative will conduct mutually agreed upon monthly teleconference calls and/or biweekly meetings, set-up and arranged for by the awardee, to include other project staff members, NCD staff and, as appropriate, selected project advisors and NCD council members.

The awardee will provide monthly electronic progress reports to the NCD Contracting Officer’s Representative.

The awardee will present on its work before NCD at a quarterly Council meeting and must factor travel expenses into the project budget.

Business Proposal

The business proposal shall contain a detailed budget for the project and the certifications and representations required by OMB Circular A-110. 

Note:  For each type of entity, there is a set of Federal principles for determining allowable costs. Allowable costs shall be determined in accordance with the cost principles applicable to the entity incurring the costs. Thus, allowable costs incurred by State, local or federally-recognized Indian tribal governments is determined in accordance with the provisions of OMB Circular A–87, “Cost Principles for State and Local Governments.” The allowable of costs incurred by non-profit organizations is determined in accordance with the provisions of OMB Circular A–122, “Cost Principles for Non-Profit Organizations.”

The allowable costs incurred by institutions of higher education is determined in accordance with the provisions of OMB Circular A–21, “Cost Principles for Educational Institutions.” The allowable costs incurred by hospitals is determined in accordance with the provisions of appendix E of 45 CFR part 74, “Principles for Determining Costs Applicable to Research and Development under Grants and Contracts with Hospitals.” The allowable costs incurred by commercial organizations and those non-profit organizations listed in Attachment C to Circular A–122 is determined in accordance with the provisions of the Federal Acquisition Regulation (FAR) at 48 CFR part 31.

Technical Evaluation Criteria

Evaluation criteria will score proposals with a maximum of 100 points, divided as follows:

1. A clear understanding of the nature of the work (20 points)

The proposal presents a clear understanding of the tasks required and the importance, quality, and reliability of those tasks. The proposal will present the rationale and/or interpretation of the project approach.

2. Procedural Plan (30 points)

The proposal contains evidence of a fully described technical approach to comply with each of the tasks in the scope of work. The proposal is consistent with the goals, objectives, compliance requirements, and is practical in terms of producing needed information, analysis, and recommendations.

3. Management Plan and Schedule (20 points)

The degree to which the project team, including any use of consultants, is organized, managed, and motivated to accomplish effective and efficient implementation of all tasks to be completed. The proposal budget is appropriate to the administration of the project. The time frame is realistic. Plans and schedules to assure smooth cooperation with the NCD staff involved are evident. The proposal clearly identifies who will be key personnel and includes a table showing the number of person-days by tasks for each of the key personnel.

4. Personnel (15 points)

The proposal provides evidence of the specific qualifications and skills of staff and consultants to be assigned to this project, and their experience and familiarity with the topic, including relevant laws, regulations, procedures, and practices in the Federal Government. Skills in writing and conducting research should also clearly demonstrated.

5. Organizational Experience (15 points)

The proposal describes to which the overall experience and past performance of the offeror in executing similar projects should be described. Evidence of related assignments should be detailed. Offeror shall present evidence of related assignments, including the names and telephone numbers of previous project officers who would be able to comment on the offeror’s performance of those assignments.

Project Start Date

The projected start of the cooperative agreement is July 30, 2021. The projected end date is January 31, 2022.   

Compliance with Executive Order 13985.

NCD wants to ensure there is stakeholder involvement in the findings and recommendations. The inclusion of people with disabilities, including people with disabilities who are multiply marginalized (black, indigenous, people of color, LGBTQ, e.g.), must be integral to the planning, development, and execution of this project. At least one section of the report should focus on stakeholder input, but input should be integrated throughout.

 

Citations & Style Guide for NCD Reports

NCD requires awardees to utilize the Chicago Style Manual for reports and papers and employs the documentary note system of citation (otherwise known as notes and bibliography). An explanation of this style of citation can be found at: http://library.williams.edu/citing/styles/chicago1.php and http://www.chicagomanualofstyle.org/tools_citationguide.html.

Accessibility of Reports

NCD reports must be totally accessible to all people with disabilities at all iterative stages of its drafting and editing. All graphs and charts must have full text descriptions embedded as alt-text and ensure that it is Section 508 compliant. All drafts and final versions must be submitted in electronically in Word and PDF format.

Proposal Review Information

Reviews of proposals submitted to NCD are solicited from peers with expertise in the substantive area of the proposed project. At least three reviewers are selected by the NCD staff overseeing the review process. A conflict check is conducted to ensure that reviewers have no conflicts that prevent a review of offeror’s proposal. Special efforts are made to recruit reviewers from non-academic institutions, minority-serving institutions, or adjacent disciplines to that principally addressed in the proposal. Reviewers score and comment on each proposal. Reviews are treated as confidential documents. The NCD staff overseeing the review, examines the scores and comments, and formulates a recommendation.

Notice of Award

NCD will notify the offeror by telephone and e-mail. This will begin negotiations for a cooperative agreement. The notification is not authorization to begin performance. Organizations or individuals whose proposals are declined will be advised as promptly as possible. A summary of the strengths and weaknesses identified by reviewers, of each declined proposal, not included identifying names or information about proposal reviewers, will be made available upon request. 

About the National Council on Disability

Overview and Purpose

The National Council on Disability (NCD) is an independent federal agency comprised of a team of Presidential and Congressional appointees, an Executive Director appointed by the Chair, and a full-time professional staff. The purpose of NCD is to promote policies, programs, practices, and procedures that guarantee equal opportunity for all people with disabilities regardless of the nature or significance of the disability and to empower people with disabilities to achieve economic self-sufficiency, independent living, and inclusion and integration into all aspects of society.

Specific Duties

NCD’s statutory duties are set forth at 29 USC §781, and include:

(1) provide advice to the Director with respect to the policies and conduct of the National Institute on Disability, Independent Living, and Rehabilitation Research, including ways to improve research concerning individuals with disabilities and the methods of collecting and disseminating findings of such research;

(2) provide advice to the Commissioner with respect to the policies of and conduct of the Rehabilitation Services Administration;

(3) advise the President, the Congress, the Commissioner, the appropriate Assistant Secretary of the Department of Education, and the Director of the National Institute on Disability, Independent Living, and Rehabilitation Research on the development of the programs to be carried out under this chapter;

(4) provide advice regarding priorities for the activities of the Interagency Disability Coordinating Council and review the recommendations of such Council for legislative and administrative changes to ensure that such recommendations are consistent with the purposes of the Council to promote the full integration, independence, and productivity of individuals with disabilities;

(5) review and evaluate on a continuing basis—

(A) policies, programs, practices, and procedures concerning individuals with disabilities conducted or assisted by Federal departments and agencies, including programs established or assisted under this chapter or under the Developmental Disabilities Assistance and Bill of Rights Act of 2000 [42 U.S.C. 15001 et seq.]; and

(B) all statutes and regulations pertaining to Federal programs which assist such individuals with disabilities; in order to assess the effectiveness of such policies, programs, practices, procedures, statutes, and regulations in meeting the needs of individuals with disabilities;

(6) assess the extent to which such policies, programs, practices, and procedures facilitate or impede the promotion of the policies set forth in subparagraphs (A) and (B) of section 780(a)(2) of this title;

(7) gather information about the implementation, effectiveness, and impact of the Americans with Disabilities Act of 1990 (42 U.S.C. 12101 et seq.);

(8) make recommendations to the President, the Congress, the Secretary, the Director of the National Institute on Disability and Rehabilitation Research, and other officials of Federal agencies or other Federal entities, respecting ways to better promote the policies set forth in section 780(a)(2) of this title;

(9) provide to the Congress on a continuing basis advice, recommendations, legislative proposals, and any additional information that the National Council or the Congress deems appropriate; and

(10) review and evaluate on a continuing basis new and emerging disability policy issues affecting individuals with disabilities at the Federal, State, and local levels, and in the private sector, including the need for and coordination of adult services, access to personal assistance services, school reform efforts and the impact of such efforts on individuals with disabilities, access to health care, and policies that operate as disincentives for the individuals to seek and retain employment; and

Preparing and submitting to the President and Congress an annual report titled National Disability Policy: A Progress Report.

International

In 1995, NCD was designated by the Department of State to be the U.S. government’s official contact point for disability issues. Specifically, NCD interacts with the special rapporteur of the United Nations Commission for Social Development on disability matters.

Consumers Served and Current Activities

Although many government agencies deal with issues and programs affecting people with disabilities, NCD is the only federal agency charged with addressing, analyzing, and making recommendations on issues of public policy that affect people with disabilities regardless of age, disability type, perceived employment potential, economic need, specific functional ability, veteran status, or other individual circumstance. NCD recognizes its unique opportunity to facilitate independent living, community integration, and employment opportunities for people with disabilities by ensuring an informed and coordinated approach to addressing the concerns of people with disabilities and eliminating barriers to their active participation in community and family life.

NCD plays a major role in developing disability policy in America. NCD originally proposed what eventually became the ADA. To see NCD’s present and past work on issues that are key to the lives of people with disabilities, visit www.ncd.gov.

Statutory History

NCD was established in 1978 as an advisory board within the Department of Health Education and Welfare (P.L. 95-602). The Rehabilitation Act Amendments of 1984 (P.L. 98-221) established NCD as an independent agency.

For General Information:
202-272-2004 Voice
202-272-2074 TTY
202-272-2022 Fax