A new payment model at the School of Pharmacy and Health Professions at Creigton University demonstrates that high performance health care can be delivered by pharmacists — and they can get paid for it. In other words, a pay-for-performance (P4P) model was adopted, and compared with the traditional fee-for-service model.

The P4P model could pay 20 percent more than the FFS model. If patients achieved evidence-based outcome goals for specific conditions, pharmacists could earn an additional 43 percent.

“We were not looking to find an ideal pay-for-performance model in pharmacy practice, but what we wanted to do was to create a model to stimulate discussion,” says Thomas L. Lenz, PharmD, MA, associate professor of pharmacy practice and lead researcher.

Specific patient outcomes were collected over 12 months. It uses an all-or-none bundled approach for payment in which the pharmacist is paid at a higher rate if patients meet six outcome criteria after one year.

The authors emphasized that this model would be important to payers because it is based on patient outcomes and pre-established return-on-investment models.

In 2010, 15 participants with risk factors for cardiovascular disease were followed. A guaranteed rate of $2.50 per minute per patient was applied, earning the pharmacist a total of $14,625 (390 minutes x $2.50 x 15). In addition, the 11 patients who met all six outcome criteria earned pharmacists a bonus of $1/minute/patient — $4,290 per year. That brought the total payment to $18,915 for year 1.

In the second year, a guaranteed payment rate of $2.50 per minute per patient was applied to all 15 participants. That worked out to $5,625 (150 minutes x $2.50 x 15). Those who eventually achieve all six outcome goals would earn the pharmacist an extra $1/minute/patient — an extra $2,250 per year, bringing the total payment to $7,875 for year 2 and each year thereafter.

“In year 1, a pharmacist spends more time with these patients if he’s participating in a P4P program to establish positive health behaviors. Subsequently, the pharmacist’s payment is higher,” Lenz says.

“After the first year, the amount of time spent with each individual is less because we are helping them maintain their behaviors, but our reimbursement is still higher than the traditional model.”

Comparing payment rates for FFS and P4P models
Traditional FFS-MTM model P4P-MTM/lifestyle medicine model
Year 1
Number of patient visits/year 12
Total time/patient/year (minutes) 195
Payment rate/minute $2.00
Payment/patient/year $390
Year 1
Number of patient visits/year 11
Total time/patient/year (minutes) 390
Payment rate/minute $2.50–3.50
Payment/patient/year $975–1,365
Year 2
Number of patient visits/year 12
Total time/patient/year (minutes) 195
Payment rate/minute $2.00
Payment/patient/year $390
Year 2
Number of patient visits/year 4
Total time/patient/year (minutes) 150
Payment rate/minute $2.50–3.50
Payment/patient/year $375–525

Source: Lenz TL, Monoghan MS. Pay-for-performance model of medication therapy management in pharmacy practice. J Am Pharm Assoc. 2011:51(3):425–431.

Managed Care’s Top Ten Articles of 2016

There’s a lot more going on in health care than mergers (Aetna-Humana, Anthem-Cigna) creating huge players. Hundreds of insurers operate in 50 different states. Self-insured employers, ACA public exchanges, Medicare Advantage, and Medicaid managed care plans crowd an increasingly complex market.

Major health care players are determined to make health information exchanges (HIEs) work. The push toward value-based payment alone almost guarantees that HIEs will be tweaked, poked, prodded, and overhauled until they deliver on their promise. The goal: straight talk from and among tech systems.

They bring a different mindset. They’re willing to work in teams and focus on the sort of evidence-based medicine that can guide health care’s transformation into a system based on value. One question: How well will this new generation of data-driven MDs deal with patients?

The surge of new MS treatments have been for the relapsing-remitting form of the disease. There’s hope for sufferers of a different form of MS. By homing in on CD20-positive B cells, ocrelizumab is able to knock them out and other aberrant B cells circulating in the bloodstream.

A flood of tests have insurers ramping up prior authorization and utilization review. Information overload is a problem. As doctors struggle to keep up, health plans need to get ahead of the development of the technology in order to successfully manage genetic testing appropriately.

Having the data is one thing. Knowing how to use it is another. Applying its computational power to the data, a company called RowdMap puts providers into high-, medium-, and low-value buckets compared with peers in their markets, using specific benchmarks to show why outliers differ from the norm.
Competition among manufacturers, industry consolidation, and capitalization on me-too drugs are cranking up generic and branded drug prices. This increase has compelled PBMs, health plan sponsors, and retail pharmacies to find novel ways to turn a profit, often at the expense of the consumer.
The development of recombinant DNA and other technologies has added a new dimension to care. These medications have revolutionized the treatment of rheumatoid arthritis and many of the other 80 or so autoimmune diseases. But they can be budget busters and have a tricky side effect profile.

Shelley Slade
Vogel, Slade & Goldstein

Hub programs have emerged as a profitable new line of business in the sales and distribution side of the pharmaceutical industry that has got more than its fair share of wheeling and dealing. But they spell trouble if they spark collusion, threaten patients, or waste federal dollars.

More companies are self-insuring—and it’s not just large employers that are striking out on their own. The percentage of employers who fully self-insure increased by 44% in 1999 to 63% in 2015. Self-insurance may give employers more control over benefit packages, and stop-loss protects them against uncapped liability.