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PubMed1996

Formularies in integrated health systems: Sharp HealthCare.

Formulary management implications are described for a California health system consisting of 7 hospitals, 4 skilled-nursing centers, 22 medical clinics, 8 urgent care facilities, and a health maintenance organization. Sharp HealthCare serves nearly 1 million people in the San Diego area. A single institutional care division (ICD) pharmacy service has been created under the guidance of a steering committee consisting of a pharmacy operations coordinator and a staff pharmacist from each site, the system pharmacy director, the system senior pharmacy information systems specialists, and the system senior clinical pharmacy specialist. Operations at each site are overseen by an operations coordinator instead of a pharmacy director. Functional teams reporting to the steering committee are standardizing pharmacy processes, including formulary management; this is particularly important because the ICD has pharmacist and nurse per diem pools. Until 1995, formularies were independently managed at each site. Now, one system formulary is being developed. Standard policies and procedures, a nonformulary drug request form, and a monograph format have been completed. The hospitals' autonomous medical staffs have thus far elected to retain individual pharmacy and therapeutics (P&T) committees but approved a revamped formulary review process and systemwide P&T subcommittees. The computer system is being enhanced so that pharmacists anywhere in one of the hospitals will have access to applicable P&T committee-approved guidelines for drug use. Since vendors were advised that the system is establishing one formulary, Sharp has been able in some cases to achieve better pricing than it previously could through its purchasing group. Drug use is influenced by each site's pharmacy and therapeutics committee. The ideal, however, is to have this responsibility consolidated in a single systemwide committee.

California↗
PubMed1997

Projecting future drug expenditures--1997.

Use of the producer price index; data from independent sources, drug industry analyst, group purchasing organizations (GPOs), and health maintenance organizations (HMOs); pharmacoeconomics; and legal developments to project drug expenditures and prepare pharmacy budgets for 1997 is discussed. The producer price index indicates that prices for drugs and pharmaceuticals increased 2.2% during January to May 1996; the increase for prescription preparations was 3.4%. Medi-Span reports an average increase for all drug products of 1.2% for the first six months of 1996. IMS America data show the price of all drugs increasing 1.8% between the second quarters of 1995 and 1996. Drug industry analysts project the overall price increase in the next 12 months at 2.5-5.0%. GPOs predict an average increase over the next 12 months of 2.2% for contracted drugs and 4.3% for non-contracted drugs. HMO pharmacy directors predict pharmacy expenditures will increase by 4.5% per member in 1997. Caution must be applied in using pharmacoeconomics to project drug costs and their impact on health care expenditures. Today's budget must account for the greater integration of drug expenditures into the institution's objectives, possible reductions in other service costs, capitation, competition, shifting of control of the drug budget to specific patient care centers, relocation of services to the ambulatory care setting, and outsourcing. Legal actions in 1996 that may affect price increases and drug budgets included a class-action lawsuit by community and chain pharmacies alleging price discrimination by manufactures and wholesalers. Prices of pharmaceutical products are fairly stable and may remain so in 1997, but projections of future drug expenditures must account for the continuing reshaping of the health care landscape.

Budgets↗
PubMed1998

Projecting future drug expenditures--1998.

Drug cost projections for 1998, factors that directly influence drug costs, and tools for projecting drug expenditures are discussed. The producer price index indicates that prices for drugs and pharmaceuticals increased 2.1% between January and June 1997; the increase for prescription preparations was 2.7%. Medi-Span data show an average increase for all drug products of 1.02% during the first six months of 1997; First Data-Bank reports a 1.7% increase for the same period. IMS America data, which take account of weighting for individual drugs or drug classes, show the prices of all drugs increasing 2.3% between the second quarters of 1996 and 1997. Drug industry analysts project the overall price increase in the next 12 months at 2-4%. Group purchasing organizations predict an average increase over the next 12 months of 0.56% for contracted drugs and 3.6% for noncontracted drugs. Various health care provider indexes suggest that increases in drug costs could be smaller over the next few years. The current trend of takeovers and mergers of pharmaceutical companies and health systems is likely to continue into 1998. As a result of generic competition and the loss of patent protection for many pharmaceutical products, the number of drugs to be introduced onto the market and the number of drugs in development are expected to escalate until the year 2000. These and other major changes in the health care environment, including changes in drug distribution and controversies over the use of formularies, will make future forecasting difficult. Compared with previous years, smaller increases in drug costs have been projected for 1998 and beyond, but changes in the health care environment mean that greater knowledge will be required to forecast future drug expenditures.

Drug Approval↗
PubMed1999

Projecting future drug expenditures--1999.

Drug cost projections for 1999 and factors that are likely to influence drug costs are discussed. The producer price index indicates that the prices of drugs and pharmaceuticals increased sharply, by an average of 10.2%, during the first 10 months of 1998, compared with just 2.1% for all of 1997; the price of pharmaceutical prescription preparations increased by an average of 17.4% in the first 10 months of 1998-an increase of more than six times the average increase for 1997. In the first quarter of 1998, many generic drugs had major price increases. All these increases may be a sign of considerably higher drug costs in 1999. Group purchasing organizations predict price increases in 1999 of 3% for contracted drugs, 5% for noncontracted drugs, and 8% for current and newly marketed drug products. FDA has been able to decrease the time necessary to approve new drugs under the Prescription Drug User Fee Act of 1992 and will be expected to decrease the time even further under the FDA Modernization Act of 1997. Increases of 10-12% or more in managed health care coverage rates are being predicted for 1999, with even larger increases expected for fee-for-service plans. Managed care organizations point to the cost of prescription drugs as the major reason for their rate increases. Last year's prediction that we may be entering a period of smaller increases in drug costs was not fulfilled in 1998; all signs point to even higher drug costs in 1999.

Drug Approval↗
PubMed2001

National supply-chain survey of drug manufacturer back orders.

The impact of manufacturer back orders on the supply chain for pharmaceuticals in the institutional setting was studied. A questionnaire was distributed during May and June 2000 to 600 institutional pharmacies affiliated with a major national drug and supply group purchasing organization. The instrument included questions on basic institutional demographics, perceptions about the frequency of manufacturer back orders for pharmaceuticals, the quality of communication with manufacturers and wholesalers about back orders, the two most significant back orders that had occurred in the 12 months preceding the survey, and the reasons for and impact of back orders. A total of 170 usable surveys were returned (net response rate, 28.3%). Reported manufacturer back orders included an array of drug classes, including blood products, antimicrobials, antiarrhythmics, benzodiazepine antagonists, thrombolytics, corticosteroids, and antihypertensives. Respondents perceived significant back orders as increasing in frequency. Communication by manufacturers and wholesalers about back orders was reported to be relatively poor. A raw-material shortage was the most common reason given by manufacturers for back orders (36.5%), followed by a regulatory issue (23.2%). In most cases (92%), medical staff members had to be contacted, indicating an interruption in the normal drug distribution process. In over a third of instances, respondents stated that the back order resulted in less optimal therapy. A survey found that manufacturer back orders for pharmaceuticals were increasing in frequency and that information flow within the supply chain was insufficient to meet the needs of end users.

Commerce↗
PubMed1995

Adverse selection among multiple competing health maintenance organizations.

This study examines risk selection among nine health plans competing for 16,182 employees of one large firm in 1989: one conventional fee-for-service plan, one group-model health maintenance organization (HMO), and seven network and independent practice model HMOs. We develop and compare measures of risk using weights based on HMO and fee-for-service expenditure data, respectively. We use a multiequation statistical model to develop two sets of utilization and expenditure weights for enrollees in each plan. One set of weights, based on discharge abstracts and outpatient records from the large group-model HMO, measures how much each of the nine groups of employees and dependents would have spent, had they been enrolled in a stringently managed plan with no consumer cost sharing. The other set of weights, based on fee-for-service claims data, measures how much each group would have spent, had it been enrolled in an unmanaged health plan with significant coinsurance and deductibles. Predicted annual expenditures per enrollee exhibit a 23% range from lowest (favorable selection) to highest (adverse selection) risk plans using the HMO weights and a 17% range using fee-for-service weights. The fee-for-service plan and group-model HMO with large enrollments have risk mixes near the center of the spectrum. Smaller HMOs exhibit the extreme forms of both favorable and adverse selection. The statistical methods adopted in this study can be used to risk-adjust capitation payments to competing health plans. As mergers among HMOs and group purchasing arrangements among employers increase the average enrollment in each plan from each payor, however, risk differences among plans will be attenuated and the need to risk-adjust payments will be less severe. Key words: health insurance; adverse selection; managed competition; health maintenance organization.

Actuarial Analysis↗
PubMed1997

U.S. public school enrollment-based health insurance initiatives and America's uninsured.

This article reviews current literature on school enrollment-based health insurance programs underway or pending in the United States. This model of affordable family health insurance delivery was first proposed in a 1988 New England Journal of Medicine Sounding Board article, but only a few states--Arkansas, Florida, New Hampshire, and Texas--have begun public sector-driven programs in the 1990s that use school enrollment as a pooling mechanism to purchase group insurance policies from the private sector. Public support of this model is strong, interest is currently growing, and other states, including North Carolina and Iowa, are exploring or have enacted legislation that supports establishment of school enrollment-based health insurance programs. After summarizing these public-sector initiatives, additional information is presented on uninsuredness in America; risk factors for uninsuredness among children; and national public and private initiatives in child health insurance using eligibility criteria other than or including school enrollment that were examined by the GAO in 1994/95.

Adolescent↗
PubMed1995

Legislative and policy strategies for supporting rural health network development: lessons from the 103rd Congress.

There was considerable support in most major health reform bills considered by the 103rd Congress for the development of rural integrated service networks. The demise of comprehensive health reform, together with the pace of current market-driven changes in the health care system, suggests the need to assess the impact of specific policy strategies considered in the last Congress on rural integrated service network development. Toward this end, this article evaluates the rural health policy strategies of the major bills in relation to three essential preconditions for the development of rural integrated service networks: (1) the need for a more stable financial base for rural providers; (2) the need for administrative, service and clinical capacity to mount a successful network; and finally, (3) the need for appropriate market areas to ensure fair competition among networks and plans. Key policy strategies for supporting rural network development include reform of insurance and payment policies, expansion of targeted support and technical assistance to the underserved, limited-capacity rural areas, and policies governing purchasing groups or alliances that will ensure appropriate treatment of rural providers and networks.

Comprehensive Health Care↗
PubMed2000

Antimicrobial selection for hospitalized patients with presumed community-acquired pneumonia: a survey of nonteaching US community hospitals.

OBJECTIVE: To describe and evaluate empiric antimicrobial regimens chosen for hospitalized patients with presumed community-acquired pneumonia (CAP) in US hospitals, including compliance with the American Thoracic Society (ATS) guidelines. Secondary outcomes included length of stay (LOS) and mortality associated with the choice of therapy. METHODS: A nonrandomized, prospective, observational study was performed in 72 nonteaching hospitals affiliated with a national group purchasing organization. Patients with an admission diagnosis of physician-presumed CAP and an X-ray taken within 72 hours of admission were eligible for the study. Demographic, antibiotic selection, and outcomes data were collected prospectively from patient charts. RESULTS: 3035 patients were enrolled; 2963 were eligible for analysis. Compliance with the ATS guidelines was 81% in patients with nonsevere CAP. The most common antibiotic regimen used for empiric treatment was ceftriaxone alone or in combination with a macrolide (42%). The overall mortality rate was 5.5%. The addition of a macrolide to either a second- or third-generation cephalosporin or a beta-lactam/beta-lactamase inhibitor was associated with decreased mortality and reduced LOS. CONCLUSIONS: Most hospitalized patients with CAP receive antimicrobial therapy consistent with the ATS guidelines. The addition of a macrolide may be associated with improved patient outcomes.

Adolescent↗
PubMed2006

Assessment of clinical, service, and cost outcomes of a conversion program of sumatriptan to rizatriptan ODT in primary care patients with migraine headaches.

OBJECTIVE: Managed care organizations can increase the value of drug therapy by negotiating discounts on drug acquisition costs with pharmaceutical manufacturers and promoting use of preferred drugs, including the conversion of patients to preferred medications. This investigation was designed to assess conversion success, migraine drug utilizations, and patient satisfaction with a clinical pharmacist-managed conversion program from sumatriptan to rizatriptan ODT, both formulary drugs. METHODS: This was a retrospective cohort study conducted in a managed care organization for patients aged 18 years or older who had picked up at least one outpatient prescription for any sumatriptan dosage form at the pharmacy between January 2002 and June 2002. Patients. pharmacy and medical data were reviewed to assess eligibility (e.g., no history of rizatriptan failure) for conversion from sumatriptan to rizatriptan orally disintegrating tablet (ODT). There was no copayment difference for members for rizatriptan ODT versus sumatriptan. A questionnaire was developed to assess 2 domains: (1) patient satisfaction with the medication conversion process and (2) preference for rizatriptan ODT or sumatriptan. A random sample of 315 patients who initiated conversion to rizatriptan ODT was surveyed. Electronic pharmacy claims were reviewed to determine the number of patients who were successfully converted from sumatriptan to rizatriptan ODT. Pharmacy expenditures and total health care utilization and expenditures in the 180 days prior to (baseline) and after the conversion (followup) to rizatriptan ODT were compared for the cohorts of subjects who were successfully converted and those patients who were not successfully converted. RESULTS: Therapeutic conversion from sumatriptan to rizatriptan ODT was attempted in 457 patients; 214 (47%) were successfully converted. The only difference between the 2 cohorts at baseline for the 6 months prior to attempted conversion was a higher mean number of sumatriptan doses per patient per month (PPPM) in the 243 failed conversions (mean 3.5, SD 2.9) compared with the 214 successful conversions (mean 2.8, SD 2.8, P =0.003). The median triptan doses increased by 1.0 PPPM in both cohorts (P =0.882), from 2.0 to 3.0 doses PPPM in the group of successful conversions and from 2.7 to 4.0 in the group of unsuccessful conversions. The survey response rate was 55% for both successful and for unsuccessful conversions. More than 90% of the patients in both cohorts were satisfied with the level of care provided by the clinical pharmacy staff during medication conversion, and there was no difference between the 2 cohorts in patient satisfaction (P=0.761). Rizatriptan ODT was preferred by 68.0% and 8.5% of successful and failed conversion subjects, respectively (P <0.001). Using representative group purchase prices, triptan expenditures for successful conversion subjects were reduced by a median of -2 dollars (6 %) PPPM while triptan expenditures for unsuccessful conversions increased by a median of 8 dollars (P <0.001). There were no differences for either cohort in median PPPM changes in migraine-related office visits (0.0 median change in office visits, P =0.748) or office-visit costs (0 dollars median change, P =0.861) for preconversion versus postconversion attempts Regression modeling identified that lower total counts of sumatriptan doses filled during baseline period was an independent predictor of successful conversion to rizatriptan ODT (P <0.001). There was an average of 3.5 triptan medication fills per patient for successful conversion during the 6-month follow-up period, with 78% of these subjects filling at least 2 prescriptions for rizatriptan ODT during this period. CONCLUSIONS: This conversion program for sumatriptan to rizatriptan ODT was successful in converting almost half of primary care patients to the preferred product despite the absence of a copayment incentive for members to agree to the conversion. There were no measurable medical or economic consequences of the conversion, and patient satisfaction with the quality of care was maintained. Future efforts are likely to have a higher success rate if focused on converting patients with less-severe migraine headaches, as measured by the need for baseline rescue medication, since lower acuity was the only independent predictor of successful conversion in this conversion program for 2 triptan drugs.

Female↗
PubMed1995

Should college students be vaccinated against meningococcal disease? A cost-benefit analysis.

Outbreaks and sporadic cases of meningococcal disease among college students have prompted consideration of a policy of routine vaccination for this group. Purchase and administration of the vaccine for routine vaccination would cost $56 million per year. Savings in medical care and indirect costs would not equal this amount unless the annual rate of disease among students is at least 6.5/100,000. The actual rate among students is unknown; however, surveillance data suggest it could not be more than 1.3/100,000. At rates near this estimate, the net cost of the program would be approximately $45 million annually. More cost-effective prevention strategies might be yielded by further studies to identify students at substantial risk of meningococcal disease, or by the development of a conjugate serogroup C vaccine that could be administered during infancy.

Adolescent↗
PubMed2006

Monitoring of pharmacy staffing, workload, and productivity in community hospitals.

PURPOSE: The purpose of this survey was to identify and characterize pharmacy productivity monitoring systems used in community hospitals that were part of a national group purchasing organization (GPO). METHODS: A 50-item questionnaire was developed, pretested, and sent electronically to the directors of pharmacy at 242 member hospitals of Consorta, Inc., a national GPO. The questionnaire was designed to elicit information on (1) hospital pharmacy demographics, (2) systems used to measure hospital pharmacy productivity, and (3) staffing levels and workload. Hospital demographic data were also obtained for respondent and nonrespondent hospitals from the American Hospital Association's AHA Guide. Descriptive statistics, Student's t tests, and chi-square tests were used to characterize the data and compare respondents with nonrespondents. RESULTS: Responses were received from 110 hospitals (45.5%). No clinically significant differences were found when respondent and nonrespondent hospitals were compared based on AHA Guide data. The productivity workload ratios monitored most often by respondent hospitals were full-time equivalents (FTEs) per adjusted patient day, FTEs per dose dispensed, and FTEs per dose billed. Respondents reported a mean +/- S.D. of 21.90 +/- 18.83 actual FTEs and total doses dispensed, billed, or administered per year of 111,391.4 +/- 111,538.0. A major limitation of the productivity systems used in the hospitals was the inability of the systems to account for clinical services performed by the pharmacy staff. CONCLUSION: A survey of community hospitals indicated that although most engaged in productivity monitoring, systems for such measurement often failed to capture all relevant clinical workload data.

Hospitals, Community↗
PubMed2003

Issues related to monitoring the safety of over-the-counter (OTC) medicines.

Pharmaceutical advances over the past 50 years have benefited many people in terms of disease prevention and management. However, probably without exception, most pharmaceutical products can cause adverse consequences of varying severity and frequency. In the last 10 years, many medicines that were originally prescription only have now become available over the counter (OTC), either from pharmacies or other general retail outlets. The volume and value of OTC medicine sales have increased accordingly. These switches have been well regulated and based on clear criteria and evidence of safety. Benefits of the changes include increased convenience to patients, greater self-management of minor ailments and a reduction in government drug expenditure.However, there are important differences between medicines supplied OTC and on medical prescription. With OTC medicines there is generally less healthcare professional input into the recommendation or ongoing monitoring of use. There is an absence of records per se, or linkage to other medication records elsewhere, and most countries allow direct-to-consumer advertising of the product. Taken together these differences can result in inappropriate expectations, demand and use of the OTC medicines, with limited opportunity for ongoing patient follow-up and monitoring of safety. Methodologies for pharmacy-based epidemiological studies of OTC medicines need to be developed. Studies should be large enough to detect associations that might exist, and to consider other explanations for associations such as chance, bias or confounding. There have already been some pilot studies with encouraging results with respect to follow-up rates. Outcome data however have usually been self-reported and the studies have lacked a suitable comparison group. Purchasers and suppliers of OTC medicines should also be made aware of, and encouraged to use, existing systems for spontaneous reporting of suspected adverse events, such as the Yellow Card Scheme in the UK. While available OTC medicines are perceived to be generally safe, problems have occasionally arisen with some earlier switched products (e.g. terfenadine). There have also been concerns about some traditional herbal and homeopathic remedies such as St John's wort. While such adverse events are rare, they emphasise the need for healthcare professionals and the public to understand and manage such risks. Many doctors are unaware of the range of OTC preparations available, and therefore do not consider them as a possible cause of presenting symptoms. Neither do they take them into account when making a new prescribing decision. The public need to be aware that OTC medicines should be treated with the same care as prescribed medicines, and that advice on recommended dose, contraindications and interactions should be adhered to.

Humans↗
PubMed1998

Managed care in a new key: Britain's strategies for the 1990s.

The new Labour government in Britain has issued three variations of a White Paper that outline significant changes in how the world's largest managed care health system will be run. All three emphasize systemwide criteria for quality, effectiveness, and health gain, which in turn imply redressing past inequalities in funding and service. One, the Scottish Paper, eliminates Thatcher's internal market and returns to a simple organizational structure centering on the health boards. The other two propose combining primary care practices into purchasing groups, a daunting task that will spawn many new problems and expenses as it recreates the internal market.

Budgets↗
PubMed1999

Transfusion medicine's role in hospital performance improvement. An administrator's view.

Historically, hospital administrators have viewed all laboratory sections as cost centers. The major expenses in the transfusion service are those associated with labor and blood products. However, few administrators take the time to look past this cost to see the impact of an active transfusion medicine section in other areas of the hospital. This article examines the impact of inventory management, blood component utilization and waste, group purchasing, and new program implementation on transfusion service expense and revenue.

Blood Banks↗
PubMed1991

GPOs and their product evaluation committees should be aware of their legal liabilities.

A materials manager for a large group purchasing organization is a member of a committee involved in the decision as to which products and equipment are purchased for and used by the hospitals belonging to the GPO. These decisions are based upon requests from the member hospitals and proposals submitted to the GPO by suppliers. After review by the committee, a decision to buy is made. In this dialogue, Dr. Decker discusses the issues of legal liability assumed by the GPO, the committee and its individual members in making these decisions on which to buy.

Consumer Product Safety↗
PubMed1991

Evidence and response to the impact of the Medicaid Drug Rebate Program (OBRA) on hospital pharmacy: a progress report from central Ohio.

Preliminary results of a survey conducted by the American Society of Hospital Pharmacists (ASHP) indicated that hospital drug prices increased since the implementation of rebate agreements between Medicaid and drug manufacturers. The question of how hospital pharmacy directors are planning to respond to the cost-shifting that may occur in the recent future is raised in this article. Open-ended questions posed to Central Ohio Hospital directors assessed their expectations, experience, and proposed strategies in response to the rebate program. The respondents expect increases in drug prices, reductions in discounts for volume purchases, rebate programs, and contract purchases. Increases in the use of special dating on invoice, bundling of contract purchases, shorter time period for guaranteed prices, and shorter dating on invoices are also expected. Using stricter hospital formularies and capitalizing on the negotiating strength of purchasing groups, was the common strategy considered by hospital pharmacies.

Cost Allocation↗
PubMed1991

A three-way corporate partnership for specialty hospitals.

Ultimately, the burden of escalating health care costs will be shared by all. A coalition of hospitals, suppliers, and group purchasing organizations possesses the power to communicate with each other as well as to ensure viability in the 21st century. Creative contracting will hopefully become the wave of the future in the health care industry.

Contract Services↗