With an average of 12 prescriptions per person in 2008, consumers may have more contact with their corner pharmacy than with any other part of the health care system, but in many ways pharmacies are a black box.
“Transparency has increased for hospitals, nursing homes, and doctors ... but there hasn’t been the same type of information available about pharmacies beyond drug price comparisons,” says Larry Boress, CEO of the Midwest Business Group on Health. “As we try to educate employees to be more responsible consumers and more involved in managing their health, we need to know more about what pharmacies are doing.”
While health plans can glean some information on pharmacy performance from claims data, they too are in the dark. There is minimal information to maximize the effectiveness of prescription expenditures, like data on dosing, side effects, and gaps in therapy. There are even gaps in basic services required by state pharmacy boards, such as offers for counseling on new prescriptions.
The Pharmacy Quality Alliance — a consortium of pharmacy chains, the American Pharmacists Association, payers, pharmaceutical companies, and others — is taking the lead in shining light on pharmacies by developing and implementing quality measures for community pharmacy, the sector with more than 60,000 storefronts.
PQA worked with the National Committee for Quality Assurance and a consultant to develop a starter set of 15 measures covering medication adherence/persistence, safety, appropriateness, and efficiency. Specific measures include the portion of days covered and gaps in therapy for four conditions, including diabetes and coronary heart disease. NCQA submitted the measures to the NQF for endorsement and acts as the owner of record for five measures that are now endorsed.
PQA’s measures and efforts to promote their acceptance have multiple purposes. They are part of a broader effort aimed at changing the business model of pharmacies, creating a new source of revenue, and transforming the role of pharmacists into clinical services. That means they present a slippery slope to health plans that see quality measures in a narrower role for managing costs and improving medication outcomes.
PQA is working methodically to legitimize its measures and gain support for expanding clinical services into the pharmacy arena. All 15 measures were used in five demonstration projects aimed at tweaking them and working out operational issues like reporting. The projects were not intended to create formal quality ratings. Health plans, the Iowa Medicaid program, and the pharmacy schools at the University of Pittsburgh and the University of Iowa participated.
One of the demos was conducted by Highmark, the Pittsburgh, Pa., Blue Cross plan. It asked 50 Rite Aid pharmacies to test data capture, data completeness, and the performance reporting process. “We were not interested in evaluating the pharmacies; we were interested to see if meaningful data could be collected and reported, and if the measures will help in how we might use this data in the future,” says Mark Conklin, PharmD, clinical pharmacy specialist.
In November, eight phase 2 demonstration projects were announced at PQA’s annual meeting. “The first phase validated the feasibility of using the measures,” says Laura Cranston, RPh, executive director at PQA. “The new demonstrations will test pharmacists’ interventions to see if they can move the needle on the performance scale using the 15 quality measures.” The eight projects will test several different interventions, including pay-for-performance systems for pharmacists’ services, in different target populations.
Conklin says Highmark’s phase 2 project will see whether the systems can help to identify patients who are high risk for noncompliance. “We will also see if motivational interviewing techniques by pharmacists can affect compliance rates. We will not be implementing pay for performance. Rather, we will attempt to model how pharmacists’ interventions and a pay-for-performance program might work, and if they are appropriate for further consideration.”
Pharmacists say their push to develop quality measures, expand their role, and create compensation for themselves is necessary and appropriate.
“This is the future of pharmacy practice,” says Edith Rosato, RPh, president of the National Association of Chain Drug Stores (NACDS) Foundation, a PQA member. “We have been tied to the dispensing of medications for many years, and unfortunately that has been marginalized in terms of reimbursement. With the advent of Part D and the mandate for medication therapy management, we saw an opportunity to expand our role.”
Studies in 2006 and 2007 reported that the cost of dispensing a prescription ranged from $7 to $10. The Pharmacy Benefit Management Institute reports that in 2008, the average dispensing fee paid to pharmacies for brand drugs is $1.73, and generics is $1.69. However, some costs may be covered by payments for the drugs themselves.
“Filling scripts has become a commodity service, and dispensing fees will not rebound,” says Bruce Roberts, CEO of the National Community Pharmacy Association.
But pharmacists say that patient care services are underutilized and that they can do more. “Pharmacists are experts in medications, and we are now being trained to help patients achieve optimal outcomes,” says Starlin Haydon-Greatting, a pharmacist coach and program coordinator at the Illinois Pharmacists Association. “PharmD programs are six years and the goal is to prepare pharmacists who can assume expanded responsibilities in patient care like self-management, wellness, and prevention.”
Haydon-Greatting points to the Diabetes Ten City Challenge (DTCC), a nationwide employer-funded health management program using pharmacist coaches to improve diabetes management.
A larger role for pharmacists is likely to drive up prescription expenses without a near-term reduction in total medical expenses.
The DTCC showed a 36.5 percent increase in medication costs in its first year. For 573 participants, total medication expenses increased from $1.8 million to $2.5 million. That $661,694 increase overrode a $485,335 decrease in medical claims for inpatient and outpatient services, which went from $5.7 million to $5.2 million. Total health care costs for the participants increased 5.3 percent, to $7.9 million.
Payments for pharmacists’ therapy management and patient care services would also increase expenses. These expenses were $224,043 in the DTCC — $391 per patient. There were about 3,400 patient encounters, for an average of about $65 per visit. The average visit lasted 51 minutes.
A 2005 report by Lewin Associates, prepared on the advent of the Medicare Part D program, which mandates medication therapy management (MTM) services, said that pharmacists were seeking compensation at a rate of $2 to $3 per minute. At $2 per minute, the DTCC payment would have been $102 per visit. Data are scant on actual MTM fee-for-service payment rates.
While pharmacists would like fees for service, the mindset on payment for MTM services generally has been to embed it in a care coordination fee and funnel it to physician practices acting as medical homes. “It looks like health care reform will bundle payment into medical homes and ultimately it’s going to come down to professionals negotiating for it,” says Thomas Menighan, CEO of the American Pharmacists Association.
CMS says the health reform debate has cast doubt on the future of the Medicare medical home demonstration projects, including which practitioners can claim ownership of MTM services.
Health plans and PBMs have generally ducked fee-for-service payments to pharmacists for the medication therapy management required in Part D. They perform these services themselves through call centers, for example, or they carve out individual services to subcontractors.
Another issue that health plans face with an expanded role for pharmacists is determining the exact scope of patient care services. The NACDS and American Pharmacists Association say the MTM service model in pharmacy practice includes the five core elements: medication therapy review, personal medication record, a medication-related action plan, intervention and/or referral, and documentation and follow-up.
“Intervention” has not been defined, but pharmacists are interested in providing patient care services. For example, in the DTCC they coached patients in exercise, diet, and self-management. They also performed foot exams and immunizations. Health plans worry that these services could result in duplication and fragmentation of care.
Pharmacists have shown that they can be effective in patient care. In the DTCC, they improved medication-related measures like hemoglobin A1C, cholesterol, and blood pressure.
They also boosted preventive care scores — the number of people with current influenza vaccinations, foot exams, and referrals for eye exams. But nurses, diabetes educators, and others have demonstrated outcomes similar to those in the DTCC, so the critical factor may be the interventions themselves, not the individual who performs them.
The issues and objections surrounding pharmacists’ roles and quality improvement in community pharmacy are not new to Cranston and the members of PQA who are pushing for change.
The bottom line is that the community pharmacy sector knows it needs to show a positive return on investment. “Most of the phase 2 projects have an economic analysis built in that could lead to an actuarial model,” says Cranston. “This analysis will look at total health care costs.”
Clearly, health plans have to start developing their own positions and approaches to quality improvement in community pharmacy. Highmark, for one, is approaching this with its eyes open. “We see the potential that pharmacies and pharmacists offer, but this is a new area,” says Conklin. “On the surface, things like data capture and reporting may seem straightforward, but widespread implementation and consistency can be more difficult. Furthermore, the data and measures themselves may not get at actual underlying performance or help us to manage services and benefits.”
A larger role for pharmacists is likely to drive up prescription expenses without a near term reduction in total medical expenses.