MICHIGAN MEDICAID DRUG UTILIZATION REVIEW ANNUAL REPORT

Transcription

1 State of Michigan Department of Community Health MICHIGAN MEDICAID DRUG UTILIZATION REVIEW ANNUAL REPORT Prospective and Retrospective And Cost Analysis Federal Fiscal Year 2006

2 I. Program Background and History The Medicaid (DUR) Program was created by the Omnibus Budget Reconciliation Act of 1990 (OBRA 90). The main emphasis of the program is to promote patient safety by an increased review and awareness of outpatient prescribed drugs. States were encouraged by enhanced federal funding to design and install point-of-sale electronic claims management systems that interface with their Medicaid Management Information System (MMIS) operations. The annual report requirement provides a measurement tool to assess how well state Medicaid programs have implemented the DUR program and the effect DUR has had on patient safety and provider prescribing habits. The purpose of Michigan s DUR program is to improve the quality of pharmaceutical care by ensuring that prescriptions are appropriate, medically necessary, and that they are not likely to result in adverse medical results, in accordance with OBRA 90. DUR assesses data on drug use against predetermined standards, consistent with peer-reviewed literature, and the recommendations of the State s DUR Board. The major components of DUR are Prospective DUR (ProDUR) and Retrospective DUR (RetroDUR). ProDUR provides for a review of drug therapy before each prescription is filled or delivered to a recipient. The review must include screening for items such as therapeutic appropriateness, over-utilization and under-utilization, appropriate use of generic products, therapeutic duplication, drug-disease contraindication, drug-drug interactions, incorrect drug dosage or duration of drug treatment and clinical abuse/misuse. This is accomplished by messages sent from the point-of-sale system to the dispensing pharmacist when the claim is submitted for payment. The messages may be soft messages messages which are sent as information, but do not stop the processing of the claim, or hard messages messages which stop processing and payment of the claim. Hard messages, or edits, are resolved in one of two methods. Pharmacists may override a hard edit at point of sale (POS) by submitting a code, which provides additional information about the patient. This information is compared to criteria to allow for exception and payment. A physician may have a hard edit overridden by calling and providing additional clinical information to staff. If the information meets criteria for exception then an authorization for payment is entered into the point of sale computer system. RetroDUR retrospectively assesses data on drug use against explicit predetermined standards and introduces appropriate remedial strategies to improve the quality of care. This may be accomplished through a variety of methods, including letters to specific providers about specific recipients, educational mailings or personal visits to providers by pharmacists trained to conduct educational visits. 1

3 A contract between the Michigan Department of Community Health (MDCH) and First Health Services Corporation (FHSC) for ProDUR services and related activities was initiated as a point-of-sale system on July 5, 2000 in conjunction with electronic claims adjudication. RetroDUR services and related activities began in October The Michigan DUR Board meets on a quarterly basis to review activities and reporting associated with both the ProDUR and RetroDUR. All ProDUR and RetroDur activities are carried out under the supervision of both the MDCH and the Michigan DUR Board. On December 19, 2002, FHSC began using the System Excellence (SX) processing system for Michigan Medicaid point of sale (POS) claims processing, which utilizes clinical criteria for ProDUR provided by First Data Bank Corporation (FDB). This system was updated for Michigan Medicaid on August 16, 2003 to the NCPDP transmission standard 5.1 in compliance with HIPAA regulations. RetroDUR criteria utilized include proprietary FHSC RetroDUR clinical criteria as well as custom criteria created specifically for the Michigan Medicaid program. This DUR program annual report encompasses the drug utilization review activities and outcomes that have occurred during FFY Included are ProDUR alerts and intervention statistics, RetroDUR alerts and intervention statistics. The Medicaid enrollment continues to grow, with an average total enrollment of 1,487,648 for FFY 2006, a 3% increase over FFY Presently 62% of the Medicaid patients are enrolled in Managed Care Organizations. The remaining 38% are in Fee for Service (FFS). This is the same distribution as in FFY Beneficiaries enrolled in both Medicaid and Medicare, the dual eligibles, comprise approximately 33% of the FFS population. With implementation of Medicare part D January 2006, Medicaid no longer provides prescription coverage for the majority of dual eligibles prescriptions. It is for the FFS patient population that the DUR Board reviews prescribing patterns. While the DUR Program addresses patient safety, Michigan believes safe and effective pharmaceutical prescribing results in cost effective medicine. The Michigan Medicaid program has aggressively addressed pharmacy expenditures. Other initiatives of our pharmacy program include daily Maximum Allowable Cost (MAC) pricing review, use of quantity limits, dose optimization (dose consolidation), and the multi state pooling initiative. It is through these efforts Michigan continues to provide safe and effective treatment of citizens served by the Medicaid program. This report was prepared by Annette Paul, R.Ph., Clinical Account Manager at First Health Services Corporation. Questions regarding this report should be directed to Debera H. Eggleston, M.D., Office of Medical Affairs, Michigan Medical Services Administration at (517)

4 2005 Annual Report II. Prospective (ProDUR) The POS/ProDUR system provides Michigan Medicaid with the ability to minimize potential drug interactions and drug-induced illness or side effects. Adverse reactions from drugs occur more frequently when a recipient visits more than one physician and/or more than one pharmacy to obtain medication. The dispensing pharmacist is provided with access to a comprehensive patient/drug incompatibility database. Averting adverse drug effects may result in the prevention of subsequent physician visits, hospitalizations or additional drug therapy. ProDUR achieves this objective by reviewing all claims for therapeutic appropriateness before a medication is dispensed, review of the recipient s available drug claims and history for incompatible or duplicative therapy and focusing on those recipients at the highest level of risk for harmful outcome. Utilization Analysis First Health Services ProDUR system assists the pharmacist with the detection, evaluation and counseling components of predispensing drug therapy screening by addressing ten different situations in which potential medication problems may exist. ProDUR messages and alerts are categorized as criteria-based or non-criteriabased. Criteria-based alerts are based on standard drug criteria from First Data Bank Corporation. Criteria-based alerts are separated into history and nonhistory alerts as indicated below and in Figure 1 on page 5. History alerts require a drug claim in the drug claim history to interface with the current claim. Non-history alerts are based on the current claims information. Non-criteriabased alerts are the early refill (ER) messages. The screening areas identified by ProDUR criteria are: Criteria Based Alerts: History Alerts: Drug-Drug Interactions (DD) Alert occurs when a drug to be dispensed may interact with another drug filled within the previous eight weeks from any participating pharmacy. Alerts are sent to pharmacies only on the most clinically significant drug interactions. Late Refill (LR) Alert occurs when a patient has waited to refill their maintenance medications beyond the specified days supply of the previous fill. Late refill is also known as underutilization. 3

5 Plan Level Edits (PP) Alert occurs when a drug is dispensed that meets specific criteria established by the individual plan. Michigan Medicaid currently uses this edit only for the ulcer medication edit to monitor acute ulcer medication therapy beyond a specified number of days. Prerequisite Edit (SR) - Alert occurs when a drug is dispensed that has a requirement that another drug from an established list be found in the recipient s claim history within an established time frame. Currently Michigan Medicaid uses prerequisite edits on Emend and Singulair. Therapeutic Duplication (TD) Alert occurs when a drug to be dispensed is in the same therapeutic class or is considered as having the same action, but is not clinically synergistic, as another drug filled within a specified time period. An example of this would be Oxycontin and Vicodin. Non-History Alerts: Drug-Age Contraindication (PA) Alert occurs when a drug to be dispensed is not recommended for use in the age group of the patient. Severity is assigned by First Data Bank. Drug to Inferred Disease (DC) Alert occurs when a drug is dispensed that may be contraindicated in a disease state which is inferred by drugs in the recipient s claim history. The inferred diseases are determined by First Data Bank. Drug to Gender (SX) Alert occurs when a drug is dispensed that is not recommended for use by the gender indicated on the recipient s eligibility file. Drug to gender is a criteria-based, nonhistory alert. Excessive Drug Dosage (MAX) Alert occurs when the calculated milligram dose per day of a drug exceeds the recommended daily dosage. The criteria for excessive daily dose may be age-specific. Insufficient Daily Dose (MIN) Alert occurs when the calculated milligram dose per day of a drug is less than the minimum recommended dosage. The criteria for insufficient daily dose may be age-specific. 4

6 Non-Criteria Based Alerts: Early Refill (ER) Alert occurs when a prescription is refilled before 75% of the previously filled prescription s days supply has elapsed. Early refill is a non-criteria based, non-history alert. Michigan Medicaid denies claims for selected ProDUR messages, including early refill (ER), selected therapeutic duplication (TD), drug interactions (DD), plan level edits (PP), drug to gender (SX) and prerequisite therapy (SR). These denial edits were developed and approved by the MDCH and the Michigan DUR Board. For FFY 2006, it was decided to discontinue claim denials for ingredient duplication (ID), which was found to be less meaningful than the therapeutic duplication (TD) edit. The denials for therapeutic duplication are for drugs in the narcotic analgesic class only. For all denials involving DD and TD, the pharmacist may override the edit by entering the appropriate override code as established by the MDCH. Other denials may only be overridden after consultation by the dispensing pharmacy or prescriber with the clinical personnel at FHSC. Figure 1: ProDUR Alert Categories ProDUR Criteria Based Alert Categories History Alerts Non-History Alerts DD Drug-Drug Interactions PA Drug-Age Conflict PG Pregnancy Conflict MAX Excessive Daily Dose TD Therapeutic Duplication MIN Insufficient Daily Dose LR Late Refill SR Prerequisite Therapy MC Drug-Disease DC Drug to Inferred Disease SX Drug to Gender PP Plan Level Edits The reporting module of the POS/ProDUR system integrates information from the therapeutic criteria, the pharmacy and medical claims history files and the recipient/provider tracking files to create monthly reports. ProDUR reporting tracks cost avoidance; frequency of ProDUR alerts by problem type, by drug and by number of claims. 5

7 Reports summarizing the ProDUR alerts sent to pharmacies are presented to Michigan Medicaid and to the Michigan Medicaid DUR Board at each quarterly meeting. Table 1 (see Section VI, Tables) includes a summary of all ProDUR alerts by problem type. During an average month, FHSC processed 800,233 paid POS pharmacy claims (range 539,899 1,521,181). This is a 44% decrease in the average number of paid POS claims from FFY This large decrease in the paid claims volume was caused by the implementation of the Medicare Part D Prescription Drug Program on January 1, For the first quarter of FFY 2006 (October December 2005) the average number of paid claims per month was 1,496,659, which represents a 4.2% increase over the average per month for FFY 2005 of 1,436,413 paid claims. Beginning with January 2006 and continuing through September 2006, the average number of paid claims dropped to 568,091 per month as most drug claims for the Medicare Medicaid dually eligible population were shifting to the Medicare Part D drug plans. Michigan Medicaid continued to pay for some medications for the dually eligible population, including selected over the counter medications, benzodiazepines and selected vitamin and mineral products. During this period, an average of 191,151 recipients per month (12.8% of the average monthly Medicaid eligibles) were dually eligible for Medicaid. Of these, there was an average of 187,466 dually eligible recipients in fee for service Medicaid (33.3% of the average monthly fee for service eligible). There was a 40.7% decrease in the total number of ProDUR messages sent as a reflection of the decreased total number of claims. Each claim received an average of 1.21 ProDUR messages, compared with 1.23 during FFY The decrease in average messages per claim can be attributed to several factors: Continuing enhancement of the filtering process, to show more clinically significant ProDUR messages, which more closely reflect those messages seen by pharmacy providers at point of sale. The elimination of additional drugs from the Late Refill (LR) edit. The refining of ProDUR criteria by First Data Bank, moving some edits from severity level 1 to lower levels which would not result in a message. An analysis of the top ProDUR alerts -- by problem type -- with the number of POS claims paid (and denied) receiving an alert for each drug, is included as Table 2 (see Section VI, Tables). Please note the following information extracted from this table: The drugs most frequently noted for drug to inferred disease (DC) interactions were fluticasone/salmeterol, metformin, levothyroxine, and budesonide. The drugs most frequently involved in drug-drug interactions (DD) were warfarin, lamotrigine, clonidine, and spironolactone. The most frequent early refills (ER) noted were hydrocodone, alprazolam, quetiapine and lorazepam. The most frequent excessive dose (MAX) alerts noted were hydrocodone, albuterol, propoxyphene/apap and venlafaxine. 6

8 The most frequent underutilization (LR) alerts noted were albuterol, sertraline, fluoxetine and amphetamine salts. The most frequent drug-age (PA) alerts for geriatric recipients noted were bisacodyl, diazepam amitriptyline and naproxen. The most frequent drug-age alerts for pediatric patients were lamotrigine, amphetamine salts, aspirin and guanfacine. The most frequent plan protocol units (PP anti-ulcer edit) alerts were lansoprazole, esomeprazole, pantoprazole and omeprazole. The pre-requisite edit (SR) was only active during FFY 2006 for aprepitant. The most frequent drug to gender (SX) alerts were for tamsulosin, sildenafil, medroxyprogesterone and miconazole vaginal preparations. The drugs most frequently cited for therapeutic duplications (TD) alerts were hydrocodone, quetiapine, methylphenidate, and warfarin. ProDUR Analysis ProDUR cost avoidance for the Michigan Medicaid prescription drug program is the sum of the claims that were reversed or denied and not resubmitted. An example of the first type of claim is a paid claim for a diuretic, such as furosemide, which got a therapeutic duplication message because the recipient had a recent claim for another diuretic, such as hydrochlorothiazide. The dispensing pharmacist then reversed out the paid furosemide claim and did not resubmit it. An example of the second type of cost avoidance is a claim which denied for a level one severity drug interaction, such as a claim for aspirin where the recipient has a claim in their history for warfarin, and the dispensing pharmacist did not resubmit the claim with appropriate override codes in order to receive a paid claim. This is illustrated in Figure 2 (on page 8). The ProDUR cost avoidance for FFY 2006 was $171,226,690. Table 3 (see Section VI, Tables) summarizes the FFY 2006 data. However, cost avoidance should not be interpreted as true cost savings. While the ProDUR edit may have resulted in a claim reversal or denial, it is not known what the complete impact this has on the program. There are many prescriptions that are switched after point of sale to alternative medications, which would have an improved therapeutic benefit to the patient and would not generate a ProDUR edit. The cost of this alternative medication is not reflected in the calculation of ProDUR cost avoidance. Another factor that influenced this calculation was multiple claim submission for an individual beneficiary s prescription. This would result in a number of claims and ProDUR edits for one prescription. If the provider fails to reverse the various claims, the calculations would be inflated. 7

9 Figure 2: Point of Sale Disposition of Claims Claim Denied and Not Resubmitted Cost Avoidance associated with lack of filling the prescription * Claim Denied, then Resubmitted Cost Avoidance, if any, calculated as the and Paid difference between the denied claim and resubmitted claim. Only possible if claims are in the same drug class Claim Paid, no message sent No cost avoidance Claim Paid, message sent that No Cost avoidance Does not cause claim to reject Claim Paid, message sent that Cost Avoidance not calculable due to does not cause claim to reject complexity of assessing impact. However, provider resubmits with minor adjustments or other information Claim Paid, message sent that Cost avoidance calculated as submitted does not cause claim to reject: cost of the reversed claim * however, provider reverses the claim. No other claim in same class submitted within calendar month * included in cost avoidance calculations 8

10 III. Retrospective (RetroDUR) The goal of the Michigan Medicaid RetroDUR Program is to promote appropriate prescribing and use of medications. The RetroDUR utilization analysis, as described below, provides information which assists in the identification of patterns of inappropriate prescribing and/or medication use, alerts physicians and pharmacists to potential drug therapy problems, identifies opportunities to improve drug therapy and makes recommendations to avoid drug therapy problems. Utilization Analysis The on-going operation of the RetroDUR program is a shared responsibility of First Health Services and Michigan Medicaid. Each month, specific drug classes that have been reviewed by the DUR Board are targeted for focused review under the RetroDUR program. First Health Services then applies the specified criteria established by the Board to the prescription drug and health claims files and identifies medication regimens that do not adhere to the criteria. Copies of individual medication profiles that do not adhere to specific criteria are generated by First Health Services and sent to Michigan Medicaid Profile Reviewers for indepth review. If, based on the professional opinions of the Michigan clinical reviewers or the First Health Services Michigan Medicaid Clinical Manager, an aberrant pattern of prescribing and/or utilization is indeed present, an educational letter is sent to the prescribing physician and/or the dispensing pharmacist informing the provider of the suspected problem and requesting further information to use in resolution of the issue. After the review process is completed, the First Health Services Michigan Medicaid Clinical Manager decides which patient profiles should cause the generation of physician or pharmacy letters. First Health Services produces and mails provider letters documenting the therapeutic effects of the RetroDUR program and tracks provider responses and cost savings associated with the interventions. The Michigan Medicaid DUR Board meets quarterly to review drug criteria in specific therapeutic classes and/or drug criteria for new drugs approved by the FDA. A total of 10,429 patient profiles, or an average of 869 profiles per month, reflecting these RetroDUR exceptions were subsequently reviewed by Michigan Medicaid Profile Reviewers. They then recommended a total of 5,082 intervention letters be sent to physicians and/or pharmacist providers in FFY 2006 concerning criteria variances or other medication related clinical issues. Table 4 (see Section VI, Tables) summarizes the profiles produced and lettered. 9

11 Among the problem types addressed in the intervention letters were therapeutic duplication, overutilization, drug-age contraindications and drug-drug contraindications. The Michigan DUR Board selected RetroDUR topics and/or criteria on a quarterly basis on information in the monthly ProDUR statistics or other clinically relevant topics from the medical literature. Examples of the latter include the July 2006 letters to physicians of patients who are under the age of 21 and taking aspirin. RetroDUR responses from prescribers were tracked on a monthly basis. Details of the responses are also found in Table 4 (see Section VI, Tables). The average response rate for FFY 2006 was 19.5%. Figure 3 (below) graphically displays the RetroDUR response rate. Figure 3: RetroDUR Response Rate FFY 2006 RetroDUR Response Rate FFY % 70% 60% 50% 40% 30% 20% 10% 0% Oct 05 Nov 05 Dec 05 Jan 06 Feb 06 Mar 06 Apr 06 May 06 Jun 06 Jul 06 Aug 06 Sep 06 Months in FFY 06 (Oct 05 - Sep 06) 10

12 RetroDUR Cost Analysis The provision of high quality drug therapy not only results in improved patient health but may also result in program cost avoidance. It is important to quantify the effect of interventions on the cost of drug therapy. First Health Services uses a cost analysis model developed by the Institute for Pharmacoeconomics of the Philadelphia College of Pharmacy and Science to quantify cost avoidance. When fully applied, the cost analysis model has the ability to capture not only cost avoidance that is a direct result of the RetroDUR letter intervention process, but also avoidance due to indirect effects. This indirect effect arises when a physician applies changes in prescribing triggered by a letter intervention involving one patient to other patients in his/her practice. The model also takes into account the impact of prescription drug inflation, new drugs introduced into the market, and changes in utilization rates, recipient numbers and demographics. The cost analysis in this report was calculated based on changes in the prescription drug costs for those patients whose profiles were identified through the RetroDUR program. Cost avoidance is tracked over a 12-month period beginning six months after the provider is sent a letter/intervention. Changes in prescription drug costs are totaled to yield overall cost avoidance for the review period. The total cost avoidance, attributed to RetroDUR, during FFY 2006 was $132,408. Monthly cost avoidance may vary due to a variety of factors, including: the class selection and problem type chosen for review the lag time before the next physician visit when changes in drug therapy may be made the incremental educational and familiarity impact on the prescriber after receiving intervention letters Month-by-month cost avoidance for all active interventions (i.e. interventions which have not completed twelve consecutive months of review/tracking) vary with intensity of intervention activity. Intervention letters sent during the fiscal year, have not all completed follow-up review for one year. Consequently, the cumulative cost avoidance effect of intervention letters mailed during FFY 2006 will not be known until the end of FFY Academic Detailing The Michigan DUR Board also oversees the activities of the MI Academic Detailing Program. On a quarterly basis, trained pharmacists from the Michigan Pharmacists Association (MPA) visit selected physician providers. These providers are selected based on their prescribing patterns to receive educational information on current medical topics. The topics are often selected based on 11

13 information in the ProDUR or RetroDUR reports. Topics during FFY 2006 in are listed in Figure 4 below. During FFY 2006, 392 Michigan Medicaid physician providers received a personal visit from a pharmacist detailer. Of the providers targeted for academic detailing, 81% were visited. Most commonly visits were not completed due to a physician refusal to make an appointment or canceling of the appointment by the physician. Figure 4 HISTORY OF ACEDEMIC DETAILING PROJECTS SUBJECT TREATMENT OF ASTHMA: IMPROVING PATIENT OUTCOMES ANTIBIOTIC TREATMENT FOR UPPER RESPIRATORY INFECTIONS DATE COMPLETED # OF PHYSICIANS PROFILED # OF VISITS COMPLETED PERCENTAGE OF COMPLETIONS October % May % SEDATIVE HYPNOTIC USE September % TOTAL % 12

14 IV. Factors Affecting Program Drug Costs Population Analysis Overall utilization rates can be defined in a variety of ways. These include total quantity consumed per member, number of individual prescriptions, total days supply, etc. An alternative way to look at utilization rates is by considering the number of recipients taking one particular drug for one month of time. This quantity is defined as a member-month and can give a relative view of the amount of drug used by recipients over time. Data for drug usage and overall cost by age groups have been abstracted from overall claims data. The data are summarized for FFY 2006 in Table 5 (see Section VI, Tables). The age group 0-12 utilized 14.0% of total program dollars (versus 7.8% in FFY 2005). Member-months in this category increased to 11.0% from FFY 2005 levels (5.9%). The major drug expenditures were associated with the following therapeutic classes. Unclassified Agents (primarily antihemophilia factors) class 99 Ataractics/Tranquilizers class 07 CNS Stimulants class 10 Antidepressants class 11 Anticonvulsants class 48 Amphetamines class 12 Bronchial Dilators class 15 Other Hormones (primarily growth hormones) class 64 Glucocorticoids class 51 The age group utilized 11.6% of total program dollars (versus the 5.9% utilized in FFY 2005). Member-months in this category rose to 7.8% from FFY 2005 levels (4.0%). The major drug expenditures were associated with the following therapeutic classes. Antaractics/Tranquilizers class 07 Unclassified class 99 Antidepressants class 11 Anticonvulsants class 48 CNS Stimulants class 10 Other Hormones class 64 Amphetamines class 12 Bronchial Dilators class 15 13

15 The age group utilized 23.4% of total program dollars (versus 18.4% in FFY 2005). Member-months in this category increased to 20.4% relative to FFY 2005 levels (14.3%). The major drug expenditures were associated with the following therapeutic classes. Ataractics/Tranquilizers class 07 Antidepressants class 11 Anticonvulsants class 48 Unclassified class 99 Antivirals class 33 Narcotic Analgesics class 40 Anti-Ulcer class 01 Bronchial Dilators class 15 Diabetic Therapy class 58 The age group utilized 38.2% of total program dollars, a slight decrease relative to FFY 2005 (41.0%). Member-months in this category increased to 39.4% from FFY 2005 levels (38.1%). The major drug expenditures were associated with the following therapeutic classes. Class 33, Antivirals, moved up again this year to the fourth most expensive class, from the sixth position in FFY 2005 and the ninth position in FFY Ataractics/Tranquilizers class 07 Antidepressants class 11 Anticonvulsants class 48 Antivirals class 33 Unclassified class 99 Narcotic Analgesics class 40 Anti-ulcer preparations class 01 Lipotropics class 65 Diabetic Therapy class 58 The age group > 65 utilized 12.7% of total program dollars (versus 26.9% in FFY 2005). Member-months in this category decreased to 21.4% from FFY 2005 levels (37.7%). These relatively large drops were due to the implementation of Medicare Part D. This also accounts for the increases seen in the younger age groups as the percentage of costs redistributed. The major drug expenditures were associated with the following therapeutic classes. Class 1, Anti-Ulcer/Other GI Agents, remained the first most expensive class again in FFY Anti-Ulcer/Other GI Agents class 01 Lipotropics class 65 Ataractics/Tranquilizers class 07 Unclassified class 99 Diabetic Therapy class 58 14

16 Cardiovascular Preparations, other class 76 Anticoagulants class 77 Antidepressants class 11 Parasympathetic Agents class 98 The twenty top therapeutic classes, contributing most to cost for each age category, are listed in Table 6 (see Section VI, Tables). New Drugs Another factor, which must be considered when analyzing yearly drug expenditures, is the impact of new FDA-approved drugs and dosage forms. These new agents represent costs which sometimes cannot be anticipated and have the potential to inflate drug budgets, especially if the agents are high cost. The top new drugs, listed in Table 7 (see section VI, Tables), contributed $3,943,440, or 0.65% of total paid claims, to FFY 2006 Michigan Medicaid drug costs. Even though this total is down from $4,199,485 in FFY 2005, new drugs represent an increasing portion of the total program expenditures. 15

17 VI. Tables 16

18 Program Table 1 ProDUR Message Report FFY 2006 ProDUR Message ProDUR Severity Message Count Message Amount Acute To Maintenance 1 81,764 $14,701, Drug To Drug 1 379,280 $33,443, Drug To Gender 1 2,349 $504, Drug To Geriatric 1 129,060 $4,351, Drug To Inferred Dis 1 618,063 $69,403, Drug To Pediatric 1 20,208 $5,694, Duplicate Therapy NA 2,480,109 $462,216, Min Max NA 694,647 $124,624, Prerequisite 1 1,432 $582, Too Late NA 1,512,224 $205,111, Too Soon Clinical NA 1,090,833 $141,770, ALL 7,009,969 $ Total Number of Claims with Messages 5,814,154 Average ProDUR Message Per Claim 1.21 ProDUR Severity 1 = High Importance Severity Rating is assigned by First Data Bank, Inc.

19 Table 2 ProDUR Encounters by Problem Type FFY 2006 Problem # Paid # Denial Type Drug # Claims # Alerts Alert % Alerts Alerts Acute To Maintenance LANSOPRAZOLE 189,403 36, % 89,676 90,907 PP ESOMEPRAZOLE MAG TRIHYDRATE 131,365 27, % 66,887 58,434 Anti-Ulcer Edit PANTOPRAZOLE SODIUM 30,989 3, % 2,174 28,640 OMEPRAZOLE 36,716 6, % 3,143 33,166 Problem # # Paid # Denial Type Drug History # Claims Alerts Alert % Alerts Alerts LEVOTHYROXINE Drug To Drug WARFARIN SODIUM SODIUM 96,314 20, % 45,105 48,249 DD LAMOTRIGINE DIVALPROEX SODIUM 107,628 11, % 69,325 33,542 CLONIDINE HCL METOPROLOL TARTRATE 93,626 10, % 41,965 48,329 SPIRONOLACTONE POTASSIUM CHLORIDE 35,128 9, % 17,830 15,986 TRAMADOL HCL ESCITALOPRAM OXALATE 93,709 8, % 35,749 55,033 ALPRAZOLAM FLUOXETINE HCL 397,798 7, % 277, ,134 TRAMADOL HCL SERTRALINE HCL 93,709 6, % 35,749 55,033 FLUOXETINE HCL ALPRAZOLAM 231,571 6, % 159,727 64,875 CLONIDINE HCL ATENOLOL 93,626 6, % 41,965 48,329 GEMFIBROZIL ATORVASTATIN CALCIUM 198,655 5, % 11,946 12,090 CMS FFY 2006 Table 2 1

20 Table 2 ProDUR Encounters by Problem Type FFY 2006 Problem # # Paid # Denial Type Drug History # Claims Alerts Alert % Alerts Alerts Drug To Gender TAMSULOSIN HCL Used exclusively in men 20, % 11,767 8,308 SX SILDENAFIL CITRATE Used exclusively in men 7, % 369 6,808 MEDROXYPROGESTERON E ACET Used exclusively in women 20, % 8,019 11,542 MICONAZOLE NITRATE Used exclusively in women 10, % 4,968 4,433 CLOTRIMAZOLE Used exclusively in women 29, % 12,622 15,477 LEUPROLIDE ACETATE Used exclusively in women 1, % 254 1,325 TESTOSTERONE Used exclusively in women 2, % 413 1,630 LEUPROLIDE ACETATE Used exclusively in men 1, % 254 1,325 ALFUZOSIN HCL Used exclusively in men 2, % 1, ESTROGEN, CONJUGATED Used exclusively in women 20, % 11,693 7,693 Problem # # Paid # Denial Type Drug History # Claims Alerts Alert % Alerts Alerts Drug To Geriatric BISACODYL changed 29,785 18, % 20,610 na PA DIAZEPAM changed 164,122 17, % 110,464 na AMITRIPTYLINE HCL changed 115,839 13, % 87,709 na NAPROXEN changed 57,708 10, % 28,732 na CYCLOBENZAPRINE HCL changed 76,718 9, % 38,528 na OXYBUTYNIN CHLORIDE changed 30,103 7, % 14,391 na CHLORDIAZEPOXIDE HCL changed 18,399 5, % 12,123 na NITROFURANTOIN/NITROF URAN MAC changed 21,027 3, % 11,663 na APAP/CAFFEINE/BUTAL. changed 20,756 3, % 10,895 na DICYCLOMINE HCL changed 11,828 2, % 6,298 na CMS FFY 2006 Table 2 2

21 Table 2 ProDUR Encounters by Problem Type FFY 2006 Problem # # Paid # Denial Type Drug History # Claims Alerts Alert % Alerts Alerts Drug To Inferred Disease FLUTICASONE/ SALMETEROL ALBUTEROL 86,484 66, % 40,233 na DC METFORMIN HCL LISINOPRIL 112,815 23, % 62,464 na LEVOTHYROXINE SODIUM LISINOPRIL 194,717 22, % 107,175 na BUDESONIDE ALBUTEROL SULFATE 45,799 14, % 20,470 na FLUTICASONE/SALMETER OL ALBUTEROL SULFATE 86,484 14, % 49,233 na FLUTICASONE/SALMETER OL ALBUTEROL 55,194 13, % 20,841 na HALOPERIDOL BENZTROPINE MESYLATE 30,929 13, % 19,669 na LEVOTHYROXINE SODIUM METOPROLOL 194,717 13, % 107,175 na BUPROPION HCL FLUOXETINE HCL 186,072 11, % 132,638 na BUPROPION HCL GABAPENTIN 186,072 11, % 132,638 na Problem # # Paid # Denial Type Drug History # Claims Alerts Alert % Alerts Alerts Drug To Pediatric LAMOTRIGINE changed 107,628 11, % 69,325 na PA AMPHET ASP/AMPHET/D- AMPHET changed 211,872 3, % 139,310 na ASPIRIN changed 180,414 1, % 125,900 na GUANFACINE HCL changed 7,429 1, % 4,036 na PIMECROLIMUS changed 7, % 683 na LEVOFLOXACIN changed 29, % 1,262 na PROMETHAZINE HCL changed 48, % 25,073 na LEUPROLIDE ACETATE changed 1, % 254 na SILDENAFIL CITRATE changed 7, % 369 na CLOBETASOL PROPIONATE changed 5, % 2,575 na CMS FFY 2006 Table 2 3

22 Table 2 ProDUR Encounters by Problem Type FFY 2006 Problem # # Paid # Denial Type Drug History # Claims Alerts Alert % Alerts Alerts Duplicate Therapy HYDROCODONE BIT/ACETAMINOPHEN HYDROCODONE BIT/ACETAMINOPHEN 611,593 89, % na na TD QUETIAPINE FUMARATE QUETIAPINE FUMARATE 270,662 78, % na na METHYLPHENIDATE HCL METHYLPHENIDATE HCL 386,473 75, % na na WARFARIN SODIUM WARFARIN SODIUM 96,314 49, % na na AMPHET ASP/AMPHET/D- AMPHET AMPHET ASP/AMPHET/D- AMPHET 211,872 40, % na na HYDROCODONE BIT/ACETAMINOPHEN FENTANYL 611,593 37, % na na DIVALPROEX SODIUM DIVALPROEX SODIUM 221,821 36, % na na RISPERIDONE RISPERIDONE 238,757 36, % na na FLUOXETINE HCL FLUOXETINE HCL 231,751 35, % na na SERTRALINE HCL SERTRALINE HCL 240,633 34, % na na Problem # # Paid # Denial Type Drug History # Claims Alerts Alert % Alerts Alerts Min Max HYDROCODONE BIT/ACETAMINOPHEN Adult Max 5.000EA 611,593 33, % 237,845 na ALBUTEROL Adult Max 1.020G 183,846 26, % 91,099 na HYDROCODONE BIT/ACETAMINOPHEN Adult Max 8.000EA 611,593 21, % 237,845 na ALBUTEROL Pedi Max 1.020G 183,846 20, % 91,099 na HYDROCODONE BIT/ACETAMINOPHEN Adult Max 6.000EA 611,593 18, % 237,845 na PROPOXYPHENE/ACETAMI NOPHEN Adult Max 6.000EA 119,317 15, % 48,997 na VENLAFAXINE HCL Adult Max 1.000EA 109,626 10, % 76,915 na ESCITALOPRAM OXALATE Adult Max 1.000EA 197,986 10, % 134,116 na ALBUTEROL Geri Max 1.020G 183,846 10, % 91,099 na OLANZAPINE Adult Max 1.000EA 141,522 10, % 92,045 na CMS FFY 2006 Table 2 4

23 Table 2 ProDUR Encounters by Problem Type FFY 2006 Problem # # Paid # Denial Type Drug History # Claims Alerts Alert % Alerts Alerts Prerequisite - SR APREPITANT EMEND PREREQ LIST first 1,744 1, % 357 1,310 Problem # # Paid # Denial Type Drug History # Claims Alerts Alert % Alerts Alerts Late Refill ALBUTEROL ALBUTEROL 183,846 42, % na na LR SERTRALINE HCL SERTRALINE HCL 240,633 40, % na na FLUOXETINE HCL FLUOXETINE HCL 231,751 39, % na na AMPHET ASP/AMPHET/D- AMPHET AMPHET ASP/AMPHET/D- AMPHET 211,872 37, % na na CLONAZEPAM CLONAZEPAM 255,405 37, % na na DIVALPROEX SODIUM DIVALPROEX SODIUM 221,821 32, % na na BUPROPION HCL BUPROPION HCL 186,072 31, % na na LANSOPRAZOLE LANSOPRAZOLE 189,403 31, % na na PAROXETINE HCL PAROXETINE HCL 191,230 30, % na na ESCITALOPRAM OXALATE ESCITALOPRAM OXALATE 197,986 29, % na na Problem # # Paid # Denial Type Drug History # Claims Alerts Alert % Alerts Alerts Early Refill HYDROCODONE BIT/ACETAMINOPHEN HYDROCODONE BIT/ACETAMINOPHEN 611,593 52, % 237, ,824 ER ALPRAZOLAM ALPRAZOLAM 397,798 38, % 277, ,134 QUETIAPINE FUMARATE QUETIAPINE FUMARATE 270,662 38, % 172,851 77,375 LORAZEPAM LORAZEPAM 262,911 28, % 175,666 76,570 RISPERIDONE RISPERIDONE 238,757 26, % 155,651 64,368 CLONAZEPAM CLONAZEPAM 255,405 25, % 171,021 75,453 FUROSEMIDE FUROSEMIDE 163,360 15, % 99,264 58,526 DIVALPROEX SODIUM DIVALPROEX SODIUM 221,821 15, % 148,282 65,672 SERTRALINE HCL SERTRALINE HCL 240,633 14, % 163,201 68,786 FLUOXETINE HCL FLUOXETINE HCL 231,751 14, % 159,727 64,875 CMS FFY 2006 Table 2 5

24 Program Table 3 Cost Avoidance Calculations Cost Avoidance Calculations: Paid Claims Reversed and Not Resubmitted Denied Claims Not Resubmitted $13,353,407* + $157,873,283 = $171,226,690 Calculation Details: *Paid Claims Cost Avoidance Count Amount Paid Claims: reversed 272,544 $33,244,900 Paid claims: Resubmitted (135,348) ($19,891,493) (within 72 hours) Total Calculated Cost Avoidance from Paid Claims 137,196 $13,353,407* * Paid Claims Cost Avoidance is calculated by taking the paid dollar amount of claims with a ProDUR message that had paid, but were subsequently reversed and subtracting the paid amount the claims resubmitted within 72 hours. Denied Claims Cost Avoidance Count Amount Denied Claims 2,890,943 $232,264,196 Resubmitted claims (1,036,561) ($74,390,913) (within calendar month in same drug class) Total Calculated Cost Avoidance from Denied Claims 1,854,382 $157,873,283 Denied Claims Cost Avoidance is calculated by taking the submitted dollar value of the claims that were initially denied and had a ProDUR message and subtracting any of those claims that were then resubmitted within the same calendar month and then paid. CMS FFY 06 Table 3

25 Number of Profiles Reviewed Number of letters Sent Michigan Medicaid Table 4 RetroDUR Lettering FFY 2006 Number of responses received Response % a 1b 1c 1d 1e 1f 1g 1h 2a 2b 2c 2d Month Topic Oct 05 Beer's List Drugs % Nov 05 Controlled Substances - Polypharmacy % Dec 05 ACEI late refill - under utilization % Jan 06 Antibiotics in URI % Feb 06 Diabetes, no claims for lipotropics % Mar 06 Long acting beta agonist overuse % Apr 06 Statins - late refill % May 06 Hydrocodone Therapeutic Duplication % Jun 06 Tricyclic use in age > % Jul 06 ASA < age 21: Psychostim. Duplication % Aug 06 Falls - over age % Sep 06 Falls - under age % Totals % Key to Responses 1 - Aware of situation 1d - Discussed overuse w/patient 2 - Plan to discontinue med 1e - Short term therapy 3 - Flagged record for monitoring 1f - Not recently seen 4 - Plan to change dose 1g - Patient no longer in my care 5 - Plan to counsel 1h - Patient recently expired 6 - Information incorrect 2a - Situation with patient changed 7 - Other (please describe) 2b - Patient never in my care 1a - Have discontinued the med 2c - Patient no longer in my care 2 1b - Modified drug therapy 2d - Discussed multi physicians 1c - Drug therapy not modified b/c CMS FFY 2006 Table 4

26 Program Table 5 Population Statistics FFY 2006 Age Percent Percent Percent Member Percent Avg. Amt. Drug Total Ingredient Ingredient Total # Total Paid Months Member Paid Quantity Quantity Cost Cost Of Claims Claims Amount Utilization Months Per Claim ,903, % $100,177, % 1,181, % $85,301, , % $ ,088, % $81,790, % 766, % $70,773, , % $ ,307, % $151,613, % 2,059, % $142,633,599 1,736, % $ ,488, % $237,692, % 3,682, % $233,061,468 3,349, % $ ,923, % $80,977, % 2,060, % $77,641,884 1,824, % $42.02 Totals 688,711, % $652,251, % 9,750, % $609,441,726 8,510, % $66.89 CMS FFY 2006 Table 5

27 Cl* Michigan Medicaid Program Table 6 Top 15 Therapeutic Classes By Total Cost for FFY 2006 Age 0-12 Age Age Age Age > 65 Total Total Total Total Total Total Total Total Total Total Cl Cl Cl Cl Cost Count Cost Count Cost Count Cost Count Cost Count 99 $13,021, ,762 7 $12,423, ,612 7 $38,649, ,990 7 $64,682, ,887 1 $7,345, ,905 7 $10,357, , $11,577, , $24,055, , $32,007, , $6,895, , $9,342, , $11,502, , $22,316, , $26,212, ,097 7 $6,330, , $8,409, , $4,559, , $13,947, , $16,299, , $5,193, , $7,915, , $4,726, , $8,126, , $10,300, , $4,814, , $4,822, , $4,586, , $3,121, , $9,092, , $4,708, , $4,345, , $3,024, ,785 1 $3,117, ,152 1 $8,954, , $4,360, , $3,908, , $2,071, , $2,177, , $5,493, , $4,208, , $3,501, , $1,813, , $2,175, , $7,152, , $3,927, , $2,337, , $1,100, , $2,092, , $6,101, , $3,441, ,189 1 $1,924, ,026 1 $991, $1,764, , $4,499, , $2,626, , $1,504, , $822, , $1,553, , $4,354, , $2,598, , $1,196, , $539, , $1,092, , $3,855, , $2,406, , $1,160, , $530, $1,053, , $2,834, , $2,037, , $1,132, , $516, , $1,026, , $1,866, , $1,535, ,706 * Class descriptions found in Appendix A CMS FFY 2006 Table 6

28 Program Table 7 Top 30 New Drugs by Total Cost for FFY 2006 Generic Name Brand Dosage FFY 2006 Class Strength Name Form Cost 33 RITONAVIR/LOPINAVIR MG KALETRA TABLET $1,544, QUETIAPINE FUMARATE 400 MG SEROQUEL TABLET $779, QUETIAPINE FUMARATE 50 MG SEROQUEL TABLET $514, DESFERASIROX 500 MG EXJADE TAB DISPER $383, DESFERASIROX 250 MG EXJADE TAB DISPER $134, ARIPIPRAZOLE 2 MG ABILIFY TABLET $119, ATOMOXETINE HCL 80MG STRATTERA CAPSULE $72, SUNITINIB MALATE 50 MG SUTENT CAPSULE $52, DESFERASIROX 125 MG EXJADE TAB DISPER $48, CLOZAPINE 200 MG CLOZAPINE TABLET $45, SORAFENIB TOSYLATE 200 MG NEXAVAR TABLET $44, RISPERIDONE 3 MG RISPERDAL TAB RAPDIS $35, RISPERIDONE 3 MG RISPERDAL TAB RAPDIS $17, AHF, HUMAN/VWF, HUMAN HUMATE-P KIT $14, LENALIDOMIDE 10 MG REVLIMID CAPSULE $13, ETHINYL ESTRADIOL/DROSPIRENONE 0.02 YAZ TABLET $11, ATOMOXETINE HCL 10 MG STRATTERA CAPSULE $11, DARUNAVIR ETHANOLATE 300 MG PREZISTA TABLET $11, LEVALBUTEROL TARTARATE 45MCG XOPENEX HFA AER W/ADP $11, SELEGILINE 6 MG/24 HR EMSAM PATCH TD24 $11, LEVETIRACETAM 1000 MG KEPPRA TABLET $10, PIOGLITAZONEHCL/METFORMIN HCL 15 MG ACTOPLUS MET TABLET $9, PIPERACILLIN/TAZOBACTAM SOD 4.5 G ZOSYN FROZ.PIGGY $7, NORETH A-EST ESTRA/FE FUMARATE 1MG-2 LOESTRIN 24 FE TABLET $7, ILOPROST 10 MCG/ML VENTAVIS AMPUL-NEB. $7, MECASERMIN RINFABATE/PF 36MG/0.6ML IPLEX VIAL $5, PIOGLITAZONEHCL/METFORMIN HCL 15 MG ACTOPLUS MET TABLET $4, METHYLPHENIDATE HCL 40 MG METADATE CD CPMP30-70 $4, ROSIGLITAZONE MALEATE/GLIMEPIR 4 MG AVANDARYL TABLET $2, AHF, HUMAN/VWF, HUMAN U HUMATE-P KIT $2, Total FFY 2006 Top 30 New Product Costs : $3,943, Total FFY 2006 All New Product Costs : $3,980, Percent Total Program Costs for FFY 2006 ( $609,411,713.57): 0.65% * Class descriptions located in Appendix A CMS FFY 2006 Table 7

29 APPENDIX A First Data Bank Bluebook Therapeutic Class Descriptions 1 Anti-Ulcer/Other GI Agents 51 Glucocorticoids 2 Emetics 52 Mineralocorticoids 3 Antidiarrheal Agents 53 Aldosterone Antagonists 4 Antispasmodics/Anticholinergics 54 Antidotes 5 Bile Therapy 55 Thyroid Preps 6 Laxatives 56 Antithyroid Preps 7 Ataractics/Tranquilizers 57 Iodine Therapy 8 Muscle Relaxants 58 Diabetic Therapy 9 Antiparkinson 59 Anabolics 10 CNS Stimulants 60 Androgens 11 Psychostimulants/Antidepressants 61 Estrogens 12 Amphetamines 62 Progesterone 13 Other Anti-obesity Agents 63 Oral Contraceptives 14 Antihistamines 64 Other Hormones 15 Bronchial Dilators 65 Lipotropics 16 Cough Preps/Expectorants 66 Cholesterol Reducers 17 Cold and Cough Agents 67 Digestants 18 Adrenergics 68 Protein Lysates 19 Topical Nasal and Otic Agents 69 Enzymes 20 Ophthalmic Agents 70 Rauwolfias 21 Tetracyclines 71 Other Hypotensives 22 Penicillins 72 Vasodilators, Coronary 23 Streptomycins 73 Vasodilators, Peripheral 24 Sulfonamides 74 Digitalis Preps. 25 Erythromycins 75 Xanthine Derivatives 26 Cephalosporins 76 Other Cardiovascular Agents 27 Other Antibiotics 77 Anticoagulants 28 Urinary Antibacterials 78 Hemostatics 29 Chloramphenicol 79 Diuretics 30 Antineoplastics 80 Fat Soluble Vitamins 31 Antiparasitics 81 Water Soluble Vitamins 32 Antimalarials 82 Multivitamins 33 Antivirals 83 Folic Acid Preps. 34 TB Preparations 84 B Complex w/vitamin C Agents 35 Trimethoprim 85 Vitamin K Agents 36 Topical Contraceptives 86 Infant Formulas 37 Vaginal Cleansers 87 Electrolytes & Nutrients 38 Antibacterials and Antiseptics 88 Hematinics 39 Diagnostics 89 Allergens 40 Narcotic Analgesics 90 Biologicals Appendix A