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UKCMC
MANAGED CARE PHARMACY
WORK GROUP
RECOMMENDATIONS
Approved by the UK College of Pharmacy
Executive Committee
9/18/01 Edition
Current Issues
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Therapeutic medication breakthroughs continue
Rapidly escalating drug costs/expenditures
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15-20% per year, Kentucky rate one of the highest in the US
UKHMO was 19.7% in FY01
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PMPY Plan Cost went from $296.75 (99-00) to $355.21 (00-01)
Expected to double in 5 years
Greater societal dependence on drug therapy for treatment and
prevention of disease
Promotion of high cost drugs by pharmaceutical manufacturers
Rising health insurance premiums and co-payments for
pharmaceuticals
Employee dissatisfaction with costs and perceived benefit reduction
Inattention to the problem by practitioners and lack of involvement
in addressing these issues
Utilizing Increasing
UK-HMO PRESCRIPTION UTILIZATION RATE
PER MEMBER PER YEAR
10.38
10.50
10.00
9.43
9.50
9.00
8.86
6.5% INCREASE
OVER PRIOR YEAR
98-99
99-00
10.0% INCREASE
OVER PRIOR YEAR
8.50
8.00
00-01
Utilization Increasing
Another Slice of the Data
1998-1999 1999-2000 2000-2001
Percent Ulilization
34%
35%
37%
Prescriptions per Utilizing Member per Month 2.19
2.23
2.32
Prescriptions per Utilizing Member per Year 26.24
26.77
27.82
Prescriptions per Eligible Member per Month 0.74
0.79
0.87
Prescriptions per Eligible Member per Year
8.87
9.43
10.38
Cost Per Prescription Rising
UK-HMO AVERAGE PRESCRIPTION COST TO
THE PLAN (after co-pays)
PER MEMBER PER MONTH
$31.00
$29.60
$29.00
$27.00
$24.73
$25.00
$23.00
19.7% INCREASE
OVER P RIOR YEAR
$21.82
$21.00
13.3% INCREASE
$19.00
OVER PRIOR YEAR
$17.00
$15.00
98-99
99-00
00-01
Managed Care Pharmacy
Work Group
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Problem Statement
What recommendation or information can the UK College of
Pharmacy and faculty provide to assist in maximizing medication
effectiveness and economic efficiency?

Goals
1.
2.
3.
4.
5.
Reduce rate of escalating drug cost trends
Reduce impact of drug costs on co-payments and premiums in FY03
Establish and educate individuals in controlling cost / quality of care (long term)
Incorporate cost effective utilization of pharmaceuticals into future role of College of
Pharmacy
Promote the “Best Practice” in pharmacotherapy and pharmacoeconomics
In Which Aspects Can the College
of Pharmacy Contribute?
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Expertise in drug therapy, consultation on coverage
Pharma-Copay-Therapy Clinic - collaborative effort with medical staff
Programs and research projects targeted to reduce managed care expenses
Educational tools (computer support, dedicated time)
Conduct C.E. programs to target UK Physicians and UK-HMO
Development of a data warehouse to support best practice in drug use,
treatment options/guidelines
Medication use strategies, creation of a Medication Use Management Center
Potential to contract with UK-HMO in risk-sharing agreement for costreduction
Commitment and dedication to the project
Integrate cost-effective therapy as an active part of College
mission/curriculum and pharmacist’s role
Outline for Presentation of a Plan
College of Pharmacy
Contribution
Co-payment/Member
Cost Sharing
Modification
Preventive Service
Offerings
Medication Use
Strategies
Academic Detailing
Solutions
Which options should be pursued?
Consumer Advertising
Solutions
Drug Sample
Solutions
What are the next steps?
Co-Payment/Member Cost
Sharing Strategy Modification
Health Plan Coverage of Pharmaceuticals
No
Coverage

Co-Payment
Coverage
Full
Coverage
UK has opted to utilize the co-payment coverage
option for pharmaceutical benefits in the UK-HMO
and PPO products.
UK-HMO Prescription Co-Payment
Coverage Options
Tiered
Flat Rate
Not
Recommended
Co-Payment
Coverage
Sliding
Percentage
Rate
(Or mix with Tiered)
Generic,
Preferred,
Non-Preferred;
Few Non-Covered
Diagnosis
Tiered
Generic, Preferred,
Non-Preferred; NonCovered Dx
Expanded
Non- Formulary
UK-HMO Prescription Co-Payment
Current Coverage Option
This is our current structure, however there
are options that remain that lead to escalating
prescription drug costs:
Tiered
Generic, Preferred,
Non-Preferred;
Few
1. Should the non-preferred
Non-Covered
Diagnosis
drugs be discouraged Co-Payment
by a larger differential
Coverage
in costs?
2. Are too many drugs
covered?
3. Are generic drugs promoted?
4. The co-payments have been adjusted to $8, $20 and $40.
Can we drive drug therapy to the lower co-pay drugs
(generic and preferred)?
UK-HMO Prescription Co-Payment
Recommended Coverage Option
This strategy could result in lower overall drug costs.
More drugs could be moved to a non-formulary status.
1. Change the Certificate of
Coverage to add a
non-formulary status.
2. Will the system be
Co-Payment
responsive to
Coverage
changes?
3. Is support present
Tiered
throughout the
Generic, Preferred,
enterprise?
Non-Preferred; Non4. Is medical staff willing
Covered Dx
Expanded
to make adaptations?
Non-Formulary
Member / UK-HMO Cost Sharing for
2000-2001 Plan Year
Drug Type
generic
brand preferred
non-preferred
non-formulary
Member Plan % of all
Share % Share % RX
30
70
36
24
76
56
39
61
8
100
0
N/A
Plan Cost
$660,000
$4.1 million
$560,000
N/A
UK-HMO Prescription Co-Payment
Alternative Coverage Option
This strategy could result in lower overall drug costs.
Some managed care plans are experimenting with this option.
Co-Payment
Coverage
Sliding
Percentage
Rate
(Or mix with Tiered)
1. Generally perceived as
a reduction in benefits.
2. An example would be
10% for generic,
25% for brand and
50% for non-preferred
with caps for each type.
3. Not recommended at
this time.
Branded Product Costs Rising
UK-HMO Ingredient Costs for Branded Drugs
$65.00
$60.00
2000-2001
1999-2000
$55.00
$50.00
$51. $52. $53. $55. $54. $55. $55. $54. $57. $60. $59. $58.
66 07 10 39 28 69 17 24 63 62 43 77
1999-2000 51.7 52.1 53.1 55.4 54.3 55.7 55.2 54.2 57.6 60.6 59.4 58.8
2000-2001 59.5 59.1 58.3
59
59.5 59.3 58.6 61.5
63
62.7 62.5 63.6
Generic Costs Not Rising As Fast
UK-HMO RX Ingredient Cost for
$25.00
Generic Drugs
2000-2001
$20.00
$15.00
1999-2000
$10.00
$5.00
$-
Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
1999-2000 14.1 14.6 15.2 17.8 15.8 14.7 13.7 14.1 14.7 17.3
2000-2001 16.3 15.4 15.7 17.4 18.5 19.4
19
19.2 18.7
22
17
15.9
21.9
23
Medication Use Strategies
Medication Use Strategies
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Review therapeutic drug groups with specific activities targeted
to that group
Focus on high cost drug categories
Use Proton Pump Inhibitors (PPIs) as a pilot for program
Evaluate potential for Selective Serotonin Reuptake Inhibitors
(SSRIs) or lipotropic agents (“Statins”)
Develop a structure/strategy accepted within the UKCMC
enterprise
Program must be approved by the UK Managed Care
Committee and Clinical Board prior to implementation
Medication Use Strategies
Process
Dosing
Duration Selection
Change
PPI
X
X
SSRI
X
X
Lipotropics
X
Lifestyle
Modifications
X
X
X
X
UKHMO
Where are the drug costs rising?
PRESCRIPTIONS PMPY
UK-HMO:
Lipotropics
Antidepressants
Anti-ulcer/Gastric Acid Reducers
NSAIDs
Anticonvulsants
Overall
2000
0.32
0.81
0.43
0.46
0.14
9.43
2001 % Increase
0.45
41.9%
0.92
13.3%
0.48
10.5%
0.49
7.3%
0.15
7.3%
10.38
10.1%
Express Scripts:
Lipotropics
Antidepressants
Anti-ulcer/Gastric Acid Reducers
NSAIDs
Anticonvulsants
Overall
2000
0.32
0.46
0.32
0.30
0.11
8.28
2001 % Increase
0.37
17.0%
0.51
9.9%
0.35
7.5%
0.34
12.0%
0.12
12.5%
8.57
3.6%
Medication Use Strategies
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Proton Pump Inhibitor (PPI) Program Example
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Dosing: Should dosing (QD versus BID) and utilization undergo closer
scrutiny?
Duration: Should a three month plan limit be placed on PPI therapy?
Selection Change:
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Should a step down to H-2 Antagonists (generic) be required for duration of
therapy greater than 3 months?
Should antacids be advocated?
Should use of pantoprazole (Protonix) be required if a PPI is prescribed?
 Effective July 1, pantoprazole is preferred but the others are available
as non-preferred; should they be non-formulary?
Lifestyle Modification: Should these be promoted?
Educational components for prescribers and patients
Cost avoidance estimates can be projected if this option is to be pursued
Estimated PPI Overuse
(2001 dollars)
$125,000
Patients
requiring
PPIs < 3
months
Patients
requiring PPIs
>3 months
$250,000
$125,000
Estimated
overuse of
PPIs
Academic Detailing Solutions
Academic Detailing Solutions
Formulary pocket guide
 Counter-detailing teams
 Targeted CE Programs
 Provider feedback on utilization rates
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Academic Detailing Solutions
Formulary Pocket Guide
PLAN DESCRIPTION:
 Develop global formulary guides (all plans)
 Distribute printed pocket guides and PDA download
version (via website access)
 Target certain providers (i.e. residents)
 Pro-active selection of the “plan drugs”
CRITICAL SUCCESS FACTOR(S):
 Ease and availability of web site update design /
designer
Academic Detailing Solutions
“Counter-Detailing” Teams
PLAN DESCRIPTION:
 Assign team(s) of detailers according to therapeutic category
 Team may consist of students, residents, faculty and pharmacists w/DI
center assistance
 Teams would develop detail pieces to inform providers of evidence-based
practices and medication costs
 Teams would plan regular times for face-to-face discussion with providers
 Communication piece is left with the prescriber
 Communication via email to providers or via web site
 Points to be emphasized: Efficacy, Safety, Cost-effectiveness
 CRITICAL SUCCESS FACTOR(S): Manpower and distribution of effort and
targeting certain provider groups and drug classes first
Academic Detailing Solutions
Internal CE Programs
PLAN DESCRIPTION:
 Counter detail teams and CE office would develop programs
 Programs would be given at grand round seminars, resident noon
conference, etc.
 Programs could be available on website
 Target medical and pharmacy staffs
 Expand training to Kroger pharmacists if applicable
CRITICAL SUCCESS FACTOR(S):
 Institutional support for programs
 Manpower availability to create and provide programs
Academic Detailing Solutions
Provider Feedback on Utilization Rate
PLAN DESCRIPTION:
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Develop reports on prescriber utilization
Present by department (peer) and by individual prescriber to the
medical staff
 Create accountability of prescribing habits
Provide financial incentives for good utilization rates (tied to
departmental or division performance)
CRITICAL SUCCESS FACTOR(S):
 Ensure accuracy of prescribing data
 Physician buy-in of program
Drug Sample Solutions
Drug Sample Solutions
Pharmacy Coordinated “Samples”
 Generic “Samples”
 Restrict Pharmaceutical Representative
Access within Clinics
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Drug Sample Solutions
Pharmacy Coordinated “Samples”
PLAN DESCRIPTION:
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Central location for storing and distributing all samples
Pharmacist will dispense samples like regular prescriptions
Records can be kept about medication use by specific patients and prescribers
Patient education about new medication including co-pay information
Pharmacist may intervene before dispensing samples to ensure cost-effective
utilization
Funding for pharmacy could be provided from pharmaceutical companies
CRITICAL SUCCESS FACTOR(S):
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Global institutional support
Space/location
Manpower for staffing
Drug Sample Solutions
Generic “Samples” (UKHMO Funded Starter Prescriptions)
PLAN DESCRIPTION:
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Provide some low-cost generic drugs as samples in the clinic (ex.
ibuprofen, enalapril, metoprolol, amoxicillin, hydrochlorothiazide)
Samples provided through sample pharmacy with label
Up to a month supply
Incorporate access to these “samples” with counter-detailing pieces
about generic utilization
CRITICAL SUCCESS FACTOR(S):
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Funding to provide starter prescriptions
Drug Sample Solutions
Restrict Pharmaceutical Representative Access
within Clinics
PLAN DESCRIPTION:
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Develop sign-in and sign-out policy
Utilize badge ID system
Set limits on time allowed in clinic during any given week or month
Set a policy for all industry sponsored lunches and events
Restrict or ban promotion of non-approved products including
information and samples
CRITICAL SUCCESS FACTOR(S):
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Universal agreement to action and policy enforcement from Clinical
Board
Alternative – control information and sample dissemination
Consumer Advertising Solutions
Direct to Consumer Advertising
(Jan to Sept 2000)*
COX – II (Vioxx, Celebrex) $193 million
Lipotropics
$130.4 million
PPI
$124 million
*Scott-Levin DTC Advertising Audit and Competitive Media Reporting,
Third Quarter 2000
Consumer Advertising Solutions
Pharma-Copay-Therapy Clinic
 Direct Patient Mailers
 Update Website Information and Access
 Kentucky Clinic Pharmacy Labels and Bag
Stuffers
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Consumer Advertising Solutions
Pharma- Copay-Therapy Clinic
PLAN DESCRIPTION:
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Pharmacist clinic
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Create a Kentucky Clinic Pharmacy Model
Help center for UKHMO patients to get advice on how to reduce
out of pocket expense for drugs (and reduced Plan costs)
May be staffed by students, residents, faculty, and pharmacists
Set certain clinic days and make appointments
Expand to Kroger Pharmacies after a model is established
CRITICAL SUCCESS FACTOR(S):
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Institutional support
Clinic staffing and space
Consumer Advertising Solutions
Direct Patient Mailers
PLAN DESCRIPTION:
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Use the PBM system to “informally” identify patients
Send mailer about reducing out-of-pocket expenses by discussing with
their provider the formulary alternatives
Target top 3-4 classes of drugs
Utilize advertising within KCP - Bag stuffer information dissemination
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Develop other mailers to educate patients
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Ask their providers if this medication is covered on insurance? What does generic
mean?
Can I ask for generic prescriptions from my provider?
Why do drugs cost
so much?
How much is my insurance really paying?
CRITICAL SUCCESS FACTOR(S):
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Manpower to develop the information
Must stay within patient confidentiality guidelines
Consumer Advertising Solutions
Update Website Information and Access
PLAN DESCRIPTION:
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Include a “reduce your co-pay” section
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Include an “ask the pharmacist” section
e-mail questions about medications or how to reduce monthly out-of-pocket
expenses
DI center may be able to respond
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Include the formulary guide and PDA download
Commonly asked drug questions (FAQs)
Add CE pieces
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Place website access shortcut on all desktops in clinic
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CRITICAL SUCCESS FACTOR(S):
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Ease and availability of web site update design and designer
Must stay within patient confidentiality guidelines
Consumer Advertising Solutions
Kentucky Clinic Pharmacy Labels and Bag Stuffers
PLAN DESCRIPTION:
 Include drug specific messaging – focus on wellness or
disease of the month
 Promote web site, include value added information
 Identify drug costs on prescription bag
 Expand to Kroger pharmacies after the model is
established
CRITICAL SUCCESS FACTOR(S):
 Counter direct to consumer advertising
 Utilize monthly contact to promote cost-effective drug use
Preventive Service Offerings
Preventive Service Offerings
Partner with UK Wellness to integrate
pharmaceutical information with Wellness
information
 Provide health service information upon
dispensing
 Pro-active long term solution
 Example – Pharmacy coordinated smoking
cessation program initiated in 2000
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Preventive Service Offerings
Identify Patient
Health Improvement
and Management Program / Clinic
Management
Prevention
Self managed
•Education
•Lifestyle modifications
•Lifestyle modifications
Professionally managed
•acute and chronic episodes of care
•DSM, MD and RPh interventions
Program Implementation Timeline
September
1 - 3 months
3 - 6 months
6 - 12 months
UK Managed Care Pharmacy Work Group
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John Armitstead, MS, RPh, Chair
Margaret Nowak-Rapp, PharmD
Bryan Yeager, PharmD
Robert Littrell, PharmD
Robert Kuhn, PharmD
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Alan Zillich, PharmD
Eric Millheim, PharmD
Kelly Smith, PharmD
Julie Davis, PharmD (Resident)
Kim Mitchell, PharmD Student
Allen Woodward,
MD (Advisory)
Ken Roberts, PhD (Advisory)
Approved by UK College of Pharmacy Executive Committee 7/12/01
Presented to UK Managed Care Committee 7/24/01
Presented to Chancellor Holsinger 8/13/01
The College of Pharmacy Contribution
College of Pharmacy
Contribution
Co-payment/Member
Cost Sharing
Modification
Preventive Service
Offerings
Medication Use
Strategies
Academic Detailing
Solutions
Consumer Advertising
Solutions
Drug Sample
Solutions
Next Steps?
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Which of the recommendations are feasible?
Which actions require medical staff buy-in?
Which pharmacy staff members should be assigned to each
recommendation?
Which recommendations can be implemented in Plan Year
2002, 2003?
Further review
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UK Managed Care Committee in August for Budget Review
Clinical Board in September
UK Health Benefits Task Force in September