Health Business Blog

Health care business consultant and policy expert David E. Williams share his views

A “transparent” player in the Pharmaceutical Benefit Management (PBM) business

PBMs such as Medco, Caremark, and Express Scripts manage pharmacy benefits on behalf of employers and health plans. They establish formularies of preferred drugs, negotiate rebates and discounts with pharmaceutical manufacturers and pharmacy networks, provide mail order services, and handle administrative details. However, it’s not clear that they lower costs for their customers, and the rebate agreements they have with manufacturers are not typically disclosed. (Matthew Holt at The Health Care Blog has written extensively on this topic.) Customer satisfaction is sometimes lacking.

Independence Health, a small health plan in New York State that dropped its PBM eight years ago, is launching what it calls a “transparent” PBM business model, in which it will pass along all of the discounts and rebates it receives and charge a straight fee-for-service to its customers. It seems unlikely that this move alone will shake up the PBM business, but it will be fun to see if there is an appetite for the new offering.

Improving drug compliance requires more than reminders and convenience

In recent posts I’ve described two approaches to improving drug compliance and persistency: a device to prompt patients to take their medications, and more convenient dosing schedules. A survey by Harris Interactive for the Wall Street Journal illustrates that while those approaches are important they won’t solve the whole problem.

In the survey, 63 percent of the respondents had been prescribed drugs that were supposed to be taken on a regular basis during the past year. Of those, the majority reported at least some non-compliance. Top reasons cited for non-compliance were:

  • Forgot to take(64%)
  • No symptoms or symptoms went away (36%)
  • Wanted to save money (35%)
  • Didn’t believe the drugs were effective (33%)
  • Didn’t think I needed to take them (31%)
  • Painful or frightening side effects (28%)
  • Drugs prevented me from doing other things I wanted to do (25%)
  • No one reminded me to keep taking or refill (20%)
  • Difficulty getting prescription filled (20%)
  • Unpleasant taste or smell (19%)
  • Difficulty opening the bottle or swallowing the drug (16%)
  • Confused by all the drugs I had to take (15%)

High tech approach to medication compliance

Informedix and McKesson Bioservices are testing the Med-eMonitor, which reminds patients to take their medicine, and can be programmed to ask for patient-specific information. The device communicates automatically with a web server.

According to CIO Insight:

The device is about the size of a videocassette and can be carried in a fanny pack. Multiple drawers each hold about a month’s supply of medicine. It alerts the patients when to take medicine, records the date and time when a medicine drawer is opened, and prompts patients to answer questions and complete other tasks.

The CEO of Informedix, Bruce Kehr says he thought up the Med-eMonitor after seeing his elderly grandmother struggle to manage her multiple drug therapy. Doctors often don’t know what to do when they see patients who aren’t responding to treatment –are the medications not working or are patients just not taking them as directed?

The device is being used now in a schizophrenia trial, where it is helping patients remember to take their schizophrenia medications. This has a big impact on the patients’ ability to function.

The Med-eMonitor and once a month osteoporosis pill (Boniva) I posted about on Monday are contrasting approaches to the challenges of adherence and compliance. The Med-eMonitor attempts to manage complex regimens, while Boniva attempts to reduce the complexity.

How community health networks can help solve ER problems

There’s another article on emergency room overcrowding and quality problems, this time in the Wall Street Journal (Is it a Heart Attack –or Indigestion? Helping the ER Doctors Get it Right). As we’ve read elsewhere, ERs are getting more crowded, triage is difficult, and information sharing and analysis isn’t as good as it should be.

The article focuses on what patients can do to improve the chance of a correct heart attack diagnosis, such as volunteering information on their risk factors, medical and family history, and carrying a copy of a previous ECG in their wallet. In an unconnected, paper-based system, that’s the best we can do. But there are clear limitations –starting with the fact that it’s hard to recall the key information when you are having a heart attack (or are unconscious).

A better solution is a communitywide electronic infrastructure –such as those being piloted by the Massachusetts eHealth Collaborative that I posted on yesterday— which would allow the ER to quickly retrieve all the information mentioned above and more. Such a system would improve the accuracy and comprehensiveness of the information, and reduce the amount of time required to gather it. And that’s just the start. A truly connected, coordinated care system would reduce the number of cases that end up in the emergency room by enabling earlier diagnosis and prevention before a crisis strikes.

Massachusetts eHealth Collaborative Selects Three Pilot Communities

The Massachusetts eHealth Collaborative (MAeHC) announced that it has selected Greater Brockton, Greater Newburyport, and Northern Berkshire to participate in a 2-3 year demonstration project to test the effectiveness and practicality of implementing electronic health records (EHRs) on a communitywide basis. The communities were chosen from a field of 35 applicants, which was narrowed to six finalists last month.

The ambitious program is backed by a $50 million funding commitment from Blue Cross Blue Shield of Massachusetts. The collaborative has 34 member organizations, including physicians’ and nurses’ groups, hospitals, health plans, the state government, provider and technology associations, and business, purchaser and public interest groups.

The Collaborative’s CEO, Micky Tripathi was hired from the Boston Consulting Group (BCG), where he and I were colleagues. While at BCG, Micky was on loan to the Indiana Health Information Exchange where he led the launch of a similar community-wide effort in Indianapolis.

Community-based initiatives are a good way to go:

  • With strong local leadership, a community can bring together disparate providers into a real care system, enabling patients to benefit from coordinated care
  • Having an intensive, local effort enables participants to gain critical mass and thereby enjoy benefits faster than in a less intensive rollout over a broader geographic area (e.g., statewide)
  • Once communities are wired up individually, it will be reasonably straightforward to link them into a wider network

It’s extremely encouraging that the Collaborative received strong applications from so many communities. The downside is that with only three winners there will be a lot of disappointed communities that won’t want to wait until the demonstration projects are done. The Collaborative will try to help other communities, but it may be stretched too thin.

Implementing EHRs across the whole state could cost $1 billion, according to the Collaborative. In the near term, it might make more sense for communities that haven’t been selected to take initial steps that fall short of a full-blown EHR. Enabling electronic prescribing, online communication of lab results, and doctor/patient messaging are relatively low cost, high impact examples that can begin to connect a community to itself.