9/18/01 Edition

1. UKCMCMANAGED CARE PHARMACY WORK GROUP RECOMMENDATIONSApproved by the UK College of Pharmacy Executive Committee 9/18/01 Edition

2. Current Issues • Therapeutic medication breakthroughs continue • Rapidly escalating drug costs/expenditures • 15-20% per year, Kentucky rate one of the highest in the US • UKHMO was 19.7% in FY01 • 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

3. Utilizing Increasing

4. Utilization Increasing Another Slice of the Data

5. Cost Per Prescription Rising

6. Managed Care Pharmacy Work Group • Problem StatementWhat recommendation or information can the UK College of Pharmacy and faculty provide to assist in maximizing medication effectiveness and economic efficiency? • Goals • 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

7. In Which Aspects Can the College of Pharmacy Contribute? • 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 cost-reduction • Commitment and dedication to the project • Integrate cost-effective therapy as an active part of College mission/curriculum and pharmacist’s role

8. Outline for Presentation of a Plan College of Pharmacy Contribution Co-payment/Member Cost Sharing Modification Preventive Service Offerings Medication Use Strategies Consumer Advertising Solutions Academic Detailing Solutions Drug Sample Solutions Which options should be pursued? What are the next steps?

9. Co-Payment/Member Cost Sharing Strategy Modification

10. Health Plan Coverage of Pharmaceuticals • UK has opted to utilize the co-payment coverage option for pharmaceutical benefits in the UK-HMO and PPO products. Full Coverage No Coverage Co-Payment Coverage

11. UK-HMO Prescription Co-Payment Coverage Options Tiered Generic, Preferred, Non-Preferred; Few Non-Covered Diagnosis Flat Rate Not Recommended Co-Payment Coverage Tiered Generic, Preferred, Non-Preferred; Non- Covered Dx Expanded Non- Formulary Sliding Percentage Rate (Or mix with Tiered)

12. UK-HMO Prescription Co-PaymentCurrent Coverage Option This is our current structure, however there are options that remain that lead to escalating prescription drug costs: 1. Should the non-preferred drugs be discouraged by a larger differential 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)? Tiered Generic, Preferred, Non-Preferred; FewNon-Covered Diagnosis Co-Payment Coverage

13. UK-HMO Prescription Co-PaymentRecommended Coverage Option • This strategy could result in lower overall drug costs. • More drugs could be moved to a non-formulary status. • Change the Certificate of • Coverage to add a • non-formulary status. • 2. Will the system be • responsive to • changes? • 3. Is support present • throughout the • enterprise? • 4. Is medical staff willing • to make adaptations? Co-Payment Coverage Tiered Generic, Preferred, Non-Preferred; Non- Covered Dx Expanded Non-Formulary

14. Member / UK-HMO Cost Sharing for 2000-2001 Plan Year

15. UK-HMO Prescription Co-PaymentAlternative Coverage Option This strategy could result in lower overall drug costs. Some managed care plans are experimenting with this option. 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. Co-Payment Coverage Sliding Percentage Rate (Or mix with Tiered)

16. Branded Product Costs Rising

17. Generic Costs Not Rising As Fast

18. Medication Use Strategies

19. Medication Use Strategies • 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

20. Medication Use Strategies

21. UKHMO Where are the drug costs rising?

22. Medication Use Strategies • Proton Pump Inhibitor (PPI) Program Example • 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: • 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

23. Estimated PPI Overuse(2001 dollars) Patients requiring PPIs >3 months Patients requiring PPIs < 3 months Estimated overuse of PPIs

24. Academic Detailing Solutions

25. Academic Detailing Solutions • Formulary pocket guide • Counter-detailing teams • Targeted CE Programs • Provider feedback on utilization rates

26. 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

27. 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

28. 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

29. Academic Detailing Solutions Provider Feedback on Utilization Rate PLAN DESCRIPTION: • 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

30. Drug Sample Solutions

31. Drug Sample Solutions • Pharmacy Coordinated “Samples” • Generic “Samples” • Restrict Pharmaceutical Representative Access within Clinics

32. Drug Sample Solutions Pharmacy Coordinated “Samples” PLAN DESCRIPTION: • 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): • Global institutional support • Space/location • Manpower for staffing

33. Drug Sample Solutions Generic “Samples” (UKHMO Funded Starter Prescriptions) PLAN DESCRIPTION: • 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): • Funding to provide starter prescriptions

34. Drug Sample Solutions Restrict Pharmaceutical Representative Access within Clinics PLAN DESCRIPTION: • 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): • Universal agreement to action and policy enforcement from Clinical Board • Alternative – control information and sample dissemination

35. Consumer Advertising Solutions

36. Direct to Consumer Advertising(Jan to Sept 2000)* *Scott-Levin DTC Advertising Audit and Competitive Media Reporting, Third Quarter 2000

37. Consumer Advertising Solutions • Pharma-Copay-Therapy Clinic • Direct Patient Mailers • Update Website Information and Access • Kentucky Clinic Pharmacy Labels and Bag Stuffers

38. Consumer Advertising Solutions Pharma- Copay-Therapy Clinic PLAN DESCRIPTION: • Pharmacist clinic • 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): • Institutional support • Clinic staffing and space

39. Consumer Advertising Solutions Direct Patient Mailers PLAN DESCRIPTION: • 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 • Develop other mailers to educate patients • 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): • Manpower to develop the information • Must stay within patient confidentiality guidelines

40. Consumer Advertising Solutions Update Website Information and Access PLAN DESCRIPTION: • Include a “reduce your co-pay” section • 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 • Include the formulary guide and PDA download • Commonly asked drug questions (FAQs) • Add CE pieces • Place website access shortcut on alldesktops in clinic CRITICAL SUCCESS FACTOR(S): • Ease and availability of web site update design and designer • Must stay within patient confidentiality guidelines

41. 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

42. Preventive Service Offerings

43. 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

44. Preventive Service Offerings Identify Patient Health Improvement and Management Program / Clinic Management Prevention • Self managed • Lifestyle modifications • Education • Lifestyle modifications • Professionally managed • acute and chronic episodes of care • DSM, MD and RPh interventions

45. Program Implementation Timeline Provider Feedback on Utilization Rate Intro of Non-Formulary Status Begin Medication Use Strategies Pharma-Copay-Therapy Clinic Begin Targeted CE Programs KCP Labels and Bag Stuffers Restrict Pharm Sales Reps Update Website Information Preventive Service Offerings Integration into Curriculum Formulary Pocket Guide Increase Website Access Finalize Long-Term Plan Drug Sample Pharmacy Direct Patient Mailers Counter Detailing Teams Short-Term Plan Generic Samples September 1 - 3 months 3 - 6 months 6 - 12 months

46. John Armitstead, MS, RPh, Chair Margaret Nowak-Rapp, PharmD Bryan Yeager, PharmD Robert Littrell, PharmD Robert Kuhn, PharmD Alan Zillich, PharmD Eric Millheim, PharmD Kelly Smith, PharmD Julie Davis, PharmD (Resident) Kim Mitchell, PharmD Student UK Managed Care Pharmacy Work Group • 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

47. The College of Pharmacy Contribution College of Pharmacy Contribution Co-payment/Member Cost Sharing Modification Preventive Service Offerings Medication Use Strategies Consumer Advertising Solutions Academic Detailing Solutions Drug Sample Solutions

48. Next Steps? • 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 • UK Managed Care Committee in August for Budget Review • Clinical Board in September • UK Health Benefits Task Force in September