Pharmacoeconomics & Health Outcomes

Applied Pharmacoeconomics Research

Community Rx & Managed Care Quality

Leon E. Cosler, R.Ph., Ph.D.

Associate Professor of Pharmacoeconomics
Albany College of Pharmacy
Road Map

• PE in Community Pharmacy
• PE in Managed Care
• MC Characteristics
• Role of PBM’s
• Rx benefit applications
• Performance Measures
• Report Cards

• Where’s he getting this?

• Text Chs. 13 + 14
PE in Community Rx

• Conducting studies?
• Participating in studies
• Pharmaceutical Care – emphasis on Pt.
outcomes
• R.Ph. – quality care to cost – conscious Pts.
• Who cares?
• Governments
• Payers
• Patients
PE in Community Rx

• Future trends
- Increased use of technology
- Information / www / and consumerism
- Consolidation of large hospitals / systems
• Seemless care / no redundancy
• Merging drug formularies…
• Drug Utilization review
• Modifying prescribing behavior
“… all of these skills require training in
pharmacoeconomics…”
PE in Community Rx

Pharma Pharma Pharma

#1 #2 #3

Wholesaler
or
Warehouse

PBMs

Chain Chain Chain

#1 #2 #3

Rx Alliance
#1
PE in Community Rx
Rx Alliance
#1

Large Health
Rx Alliance
System will
#2
select from…

Rx Alliance
• Decision based on: #3

- Increased use of technology

- cost / quality of Rx services
• superior formulary ?
• lowest acquisition costs
PE in Community Rx

• Future trends
- Patient health monitoring as routine care?
• Monitor changes & coordinate with MD?
- Evaluating their services
• Evaluate cognitive services
- Post-marketing surveillance studies
- Critically evaluate PE literature

• Pharmacist =
“Pharmaceutical Outcomes Manager” ?
Pharmacy Quality Alliance
Pharmacoeconomics in Managed Care
PE in Managed Care

• Ch.14 excellent review of Managed Care

• Business Models

• Unique strategies for controlling costs &

utilization
- Shift financial risk to providers

• Leaders in quality of health care & Pt.

outcomes
- NCQA / HEDIS measures
Managed Care Characteristics:
1. Negotiated pricing, discounts, & salaries
2. Patient Co-payments
3. Bundling services into one price
4. Peer review
5. Utilization review
6. Capitation payments
7. Channel Pts. to “preferred” providers
8. Quality criteria accountability
9. Health promotion & prevention efforts
Managed Care Rx Benefit Characteristics:

• Accomplished by using a PBM

1. P&T committee
2. Drug formulary
3. Generic / Tx interchanges
4. Treatment guidelines
5. DUR
6. Disease management
7. Academic detailing
Role of PE in Managed Care

1. Formulary Policies
• Been there / done that…

3. Appropriate use (MDs & RPh)

5. Drug Benefit design

Managed Care

1. Appropriate Rx
Usage
• Prescribing
• Optimize
quality / cost
• Use of
treatment
guidelines /
algorithms
• Dispensing
• Adherence
Role of PE in Managed Care

1. Drug Benefit design

• Prior authorizations
• Category inclusion / exclusions
• Step – therapies
• Rx outlets (mail order, etc.)
• Benefit caps

• PE needed to measure ‘big picture’

effects
Why measure performance?

• In response to criticism
• Employers / payers demanding quality

• Consumers “vote with their feet”

• Measure the quality of providers in plan

• All utilization is not excessive

• ↑ spending does ↑ satisfaction & outcomes

• Reduce variation in $$$ procedures

Managed Care Accreditation

National Committee for Quality Assurance (NCQA):

- formulates performance measures called:
- Health Plan Employer Data Information Set
(HEDIS)
- partial list of measures
- care effectiveness – use of services
- access to care – cost of care
- satisfaction – education
- MCO stability – MCO information
HEDIS Data
HCFA # Plan Name EOC020-0010 EOC020-0070 EOC020-0100
HbA1c testing Eye Exams Lipid Panels

H3351 Excellus Health Plan, Inc. dba Univera Healthcare 91.97 71.05 94.65
H3356 Excellus Health Plan, Inc. - Rochester Area Division 91 82 91.73
Rochester Area Health Maintenance Organization
H3305 d.b.a. Preferred Care 90.75 77.13 91.73
H3362 Independent Health 89.78 62.04 91.73
H3388 Capital District Physicians Health Plan, Inc. 89.29 71.53 91.97
HealthNow New York, Inc. dba BlueCross BlueShield
H3384 of Western New York 88.81 70.32 92.21
H3370 Empire BlueCross BlueShield 86.62 72.51 94.16
H3330 HIP Health Plan of New York 86.37 74.45 91.24
H3307 Oxford Health Plans - New York 84.98 66.59 93.5
H3366 Health Net of New York, Inc. 83.77 68.26 92.12
H3379 United HealthCare of New York, Inc. 80.05 53.04 86.86
H3312 Aetna Health Inc. 78.91 70.38 87.2
H3361 WellCare of New York, Inc. 77.98 55.96 77.06
H3359 Managed Health, Inc. 77.62 39.9 78.59
HEDIS Data
HCFA ID No. Plan Name Rx Cost PMPM No. Rxs PMPY

H3351 Excellus Health Plan, Inc. dba Univera 102.22 29.25

Healthcare
H3362 Independent Health 109.64 36.49
H3305 Rochester Area Health Maintenance 111.2 26.31
Organization d.b.a. Preferred Care
H3356 Excellus Health Plan, Inc. - Rochester 116.88 37.38
Area Division
H3379 United HealthCare of New York, Inc. 24.87 10.1
H3384 HealthNow New York, Inc. dba 36.49 24.88
BlueCross BlueShield of Western New
York
H3359 Managed Health, Inc. 46.45 12.81
H3388 Capital District Physicians Health Plan, 53.49 22.78
Inc.
H3307 Oxford Health Plans - New York 54.45 17.83
H3330 HIP Health Plan of New York 62.13 18.43
H3361 WellCare of New York, Inc. 63.81 13.47
H3370 Empire BlueCross BlueShield 70.97 23.06
H3366 Health Net of New York, Inc. 81.94 26.18
H3312 Aetna Health Inc. NR 23.15
Managed Care Accreditation: NYS

NYS has its our own performance measures...

- Quality Assurance Reporting Requirements
(QARR)
- MCO performance measures
• “commercial” and “Medicaid” measures

- Report available on the www

• www.health.state.ny.us
Quality
Assurance
Reporting
Requirements
Uses for this information:

• developing practice guidelines

• provider report cards

- give providers a score and compare them
- encourage providers to improve
- potential financial implications
- no Rx report cards (yet)
- e.g. new NYS Hospital Profiles
- http://hospitals.nyhealth.gov/
NCQA Report Cards:
NCQA Report Cards:
 That’s all for today!
THURSDAY:

• Post – assessment
quiz
• Complete individually
• Incentive
- BOTH done = 100%
- ONE done = 90%
- NONE done = 65%