Drug Utilization Review & Cost Reduction Strategies. Esther Liu, PharmD, MSIA, CGP Clinical Pharmacist Outcome Resources

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1 Drug Utilization Review & Cost Reduction Strategies Esther Liu, PharmD, MSIA, CGP Clinical Pharmacist Outcome Resources

2 Goals and Objectives Define Drug Utilization Reviews Interpret various performance indicators such as Benchmarking Data Conduct Cost-Effective Analysis Perform Cost Reduction Strategies

3 Drug Utilization Review (DUR) Definition - an authorized, structured, ongoing review of prescribing, dispensing and use of medications against predetermined criteria that results in changes to drug therapy DUR is classified in three categories: Prospective - evaluation of a patient's drug therapy before medication is dispensed Concurrent - ongoing monitoring of drug therapy during the course of treatment Retrospective - review of drug therapy after the patient has received the medication

4 Drug Utilization Review (DUR) Common terms: Drug Use Evaluation (DUE) Medication Use Evaluation (MUE) Used by American Society of Health System Pharmacist (ASHP) Medication use Management Pharmaceutical Utilization Management Used by National Committee for Quality Assurance (NCQA)

5 Drug Utilization Review (DUR) Why is it important? Mandated by the Government agencies NCQA, CMS, Medicaid Ensure appropriate, safe and effective use of drugs Identify opportunities to lower the overall cost of care Evaluate the benefit of intervention in enhancing therapeutic and economic outcomes

6 Drug Utilization Review (DUR) How is DUR done? Population Level (CMS, Medicaid, Public Health) Retrospective Organization Level (PBM, Hospice Administrators) Retrospective and Concurrent Patient level (Individual Clinicians) Prospective and Concurrent

7 Questions?

8 Tools for DUR Performance Indicators Benchmarking Cost-Effective Analysis (CEA)

9 Performance Indicators DUR is usually done against a set of Predetermined criteria These criteria are called Performance Indicators The indicators can be Patient s historical record Population s average Gold practice standards

10 Performance Indicators - Examples Performance Indicators Individual Level Criteria Population Level Criteria Drug Interactions Warfarin and Cipro # of patients on with Cipro with no Warfarin dose change Duplicate Therapy Advair and Symbicort # of patients with both Advair and Symbicort, Cost of the duplicated Therapy High Dose Alert >400mg Tramadol per day Avg Qty of Tramadol 50mg prescribed for a facility is > 8 per day High Cost Alert Use of Dexilant # of Dexilant Rxs for the facility Bowel Regimen for Chronic Opioid Use No Bowel Regimen while on long acting opioid % patient not on bowel regimen when receiving long acting opioids

11 Benchmarking Benchmarking a process of comparison between the performance characteristics of separate, often competing organizations intended to enable each participant to improve its own performance in the marketplace Usually done at a population level Example: CMS benchmark study Outcome Resources benchmarking data

12 Benchmarking Data - Example Outcome Resources Benchmarks: Cost per patient per day Cost per prescription Prescriptions per patient % cost on opioids, antipsychotics, PPI

13 Cost- Effective Analysis (CEA) Often used in Scientific Research It can get sophisticated! You may have been using it everyday! Esther s definition The cost comparison to achieve the same effect Example: Walmart vs. Baby R Us Methadone vs. Oxycontin

14 Questions?

15 Cost Reduction Strategies Who cares? Government Scientist/Researcher Healthcare administrators PBM/payers Individual clinicians Goal: Reduce cost while enhancing patient care and outcomes

16 Cost Reduction Strategy #1 Patient Medication Profile Directed Review the complete medication profile, diagnosis, allergy information Identify drug interactions, duplication in therapy, appropriateness of dosing and indications Required by Hospice s Condition of Participation (CoPs) Goal: Reduce cost in duplicated therapy and medications without indication Reduce cost in managing complications resulted from drug interactions, etc Reduce cost in violation to CoPs

17 Example Patient A Terminal Diagnosis: End Stage Lung Cancer Medications: Medications Direction Monthly Price ProAir (albuterol) Q4h PRN $20 DuoNeb (albuterol/ipratropium) QID and PRN $131 Advair (fluticasone/salmeterol) BID $325 Flovent (fluticasone) BID PRN $202 Prednisone 10mg daily $10 Total Cost before review $688 Saved >$500 after review for duplication!

18 Cost Reduction Strategy #2 Performance indicator directed Review summary of medication utilization data against benchmarking data or clinical gold standards Use the appropriate benchmarking data for comparison Evaluate how well your hospice is in comparison to the rest of the hospice industry Focus efforts on indicators that are significantly different from the benchmarking data Goal: Identify problem area Direct improvement plans

19 Example Hospice A Hospice A spent 25% on opioids, when its administrator wants to find out how well they are doing, what should they compare this to? A. 45% Opioid spend in neighboring Hospice B B. 28% Opioid spend at Outcome Resources (national PBM for hospice only) C. 10% Opioid spend at Humana (national PBM for Medicare Part D and Commercial business) D. 12% Opioid spend for seniors >65 years old from a published research article done in US

20 Cost Reduction Strategy #3 Cost-Effectiveness Directed Review medications used within the same class or for the same indication Observe prescribing pattern Goals: Help reduce cost with minimum impact on care quality Evaluate medication substitute/conversion programs Support formulary decisions

21 Example Opioids Rx Counts Cost Oxycontin Morphine ER Fentanyl Methadone Oxycontin 80mg q12h $900 Morphine ER 100mg q12h $350 Fentanyl 100mcg q72h $450 Methadone 10mg q12h $15

22 Questions

23 Practice Case #1 Hospice Data See handouts

24 Practice Case #2 Patient Profile See handouts

25 Summary DUR can improve quality of care and reduce cost DUR should be done routinely by clinicians together with administrators Benchmarking data can be use to identify direction of improvement Cost reduction strategies should not only focus on cost but also clinical outcomes Let the numbers take you to opportunities! Get the clinicians involved!

26 References 1. American Society of Health-System Pharmacists. ASHP guidelines on Medication- Use Evaluation, published Vol.53: National Committee for Quality Assurance. NCQA Health Plan Accreditation, Available at 3. Academy of Managed Care Pharmacy. Drug Utilization Review. Approved by AMCP Board of Directors November Navarro, Robert. Chapter 8: Drug Utilization Review Strategies. Managed Care Pharmacy Practice, published pp Kay, Jay. Health Care Benchmarking. Medical Bulletin. Vol.12 No.2 February U.S.Congress.H.R.1, Medicare Prescription Drug Improvement and Modernization Act of 2003, Public Law , 108 th Congress. Published December 2003.

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