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Research on Savings from Generic Drug Use

March 09, 2012 By: Nadia Category: HealthCare, Medicine Advice, Medtipster, Prescription News, Prescription Savings

www.Medtipster.com Source: US Government Accountability Office, January 31 2012

What GAO Found

Our review identified articles that used varying approaches to estimate the savings associated with generic drug use in the United States. One group of studies estimated the savings in reduced drug costs that have accrued from the use of generics. For example, a series of studies estimated the total savings that have accrued to the U.S. health care system from substituting generic drugs for their brand-name counterparts, and found that from 1999 through 2010 doing so saved more than $1 trillion. A second group of studies estimated the potential to save more on drugs through greater use of generics. For example, one study assessed the potential for additional savings within the Medicare Part D program—which provides outpatient prescription drug coverage for Medicare—and found that if generic drugs had always been substituted for the brand-name drugs studied, about $900 million would have been saved in 2007. A third group of studies estimated the effect on health care costs of using generic versions of certain types of drugs where questions had generally been raised about whether substituting generic drugs for brand-name drugs was medically appropriate. Unlike the other two groups which focused on savings on drugs only, these studies compared savings from the lower cost of generic drugs to other health care costs that could accrue from their use, such as increased hospitalizations. The studies had mixed results regarding the effect of using these generics in that some found they raised health care costs, while others found they led to cost savings.

Why GAO Did This Study

Prescription drug spending in the United States reached $307 billion in 2010—an increase of $135 billion since 2001—and comprised approximately 12 percent of all health care spending in the country. Until the early 2000s, drug spending was one of the fastest growing components of health care spending. However, since that time, the rate of increase has generally declined each year, attributable in part to the greater use of generic drugs, which are copies of approved brand-name drugs. Generic versions of brand-name drugs become available to consumers when brand-name drugs’ patents and periods of market exclusivity expire and generic manufacturers obtain approval to market their drug. The competition that brand-name drugs face from generic equivalents is associated with lower overall drug prices, particularly as the number of generic manufacturers grows and price competition among them increases. On average, the retail price of a generic drug is 75 percent lower than the retail price of a brand-name drug.

Increased use of generic drugs can partly be attributed to the regulatory framework that was established in the Drug Price Competition and Patent Term Restoration Act of 1984, commonly known as the Hatch-Waxman Act. The Hatch-Waxman Act facilitated earlier, and less costly, market entry of generic drugs, while protecting the patent rights of brand-name drug manufacturers, to encourage continued investment in research and development. When the act was enacted in 1984, the generic utilization rate—which is the share of all drugs dispensed that are generic—was about 19 percent. Today it is about 78 percent for drugs dispensed in retail settings, such as independent, chain, and mail-order pharmacies, as well as in long-term care facilitates. The generic utilization rate is expected to continue to grow over the next few years as a number of blockbuster drugs come off patent through 2015.

While the Hatch-Waxman Act has helped to increase the number of generic alternatives to brand-name drugs, other factors influence whether providers and consumers use generic drugs. For example, third-party payers—including private health insurance plans and public programs such as Medicare— use strategies such as tiered copayments to encourage the use of less expensive drugs within a therapeutic class, which are often generics. Also, perceptions of the safety and efficacy of generic drugs may affect their use. Thus, use of generic drugs—and the savings realized—can vary by payer as well as across therapeutic classes. You asked us to identify research completed on estimates of cost savings from the use of generic drugs in the United States. This report summarizes the findings of peer-reviewed articles, government reports, and studies by national organizations, including trade and nonprofit organizations, on this topic.

For a complete copy of the GAO report, visit: www.gao.gov/assets/590/588064.pdf

How Can You Help the Medicine Go Down?

March 30, 2011 By: Nadia Category: HealthCare, Medicine Advice, Medtipster, Prescription News, Prescription Savings

www.Medtipster.com Source: The Wall Street Journal, 3.28.2011 -by Katherine Hobson

Too many people don’t take the drugs they’re supposed to. Tackling that problem could save a lot of money and a lot of lives.

Medication can do great things for people—but only if they take it. And a lot of people aren’t taking it.

Half of patients in the developed world don’t properly take their drugs for chronic conditions, according to the World Health Organization. The additional costs for treating diseases that progress unchecked run into the hundreds of billions of dollars a year. One study estimates nearly 90,000 people die prematurely in the U.S. each year because of poor adherence to high-blood-pressure treatment alone.

So how do you get people to take their medicine? There isn’t one answer, because there isn’t one reason people aren’t sticking to their regimens. Cost, forgetfulness, side effects and doubts about effectiveness can all be factors, among others. And for many people the health-care system isn’t designed to monitor or encourage adherence to drug prescriptions.

But there are plenty of health-care professionals and researchers tackling this issue, and they have some ideas about what can be done and what should be done. Here are some of those ideas.

More Refill Information

Doctors and other health-care providers need “some way of tracking to know if patients are refilling their medications, so we can step in and help people” if they aren’t, says Robert Reid, a physician and researcher at Group Health Cooperative, a Seattle-based nonprofit health-care system that coordinates care and coverage.

Providers like Group Health and Kaiser Permanente, a large managed-care consortium based in Oakland, Calif., can track refills because they manage all aspects of their patients’ care, so all information for each of their patients is collected in one easy-to-access electronic record. Alec Does, a family-medicine physician at Kaiser Permanente Anaheim Hills, says that when he shows patients records indicating they haven’t been consistently filling their prescriptions, “90% of the time, they’ll open up” and start talking about any issues they’re having.

But most people don’t get their care from such comprehensive providers, so their doctors rarely have access to their pharmacy records.

The technology to fix that problem exists, says Valerie Fleishman, executive director of NEHI, a national health-policy research institute based in Cambridge, Mass. “Physicians are sending prescriptions to the pharmacy, so we have the capability to close that feedback loop,” she says. The problem, she says, is that most doctors are paid for specific services, like office visits and medical procedures—not for managing their patients’ health outcomes. So there is no financial incentive for them to take on the cost of tracking prescription refills.

There is no quick fix for this problem, Ms. Fleishman says, but the recently passed health-care overhaul bill includes funding for new models for care and payment that might do a better job of rewarding providers for doing whatever it takes to keep patients healthy.

Get Pharmacists Involved

“Retail pharmacists appear to be able to play a really substantial role in encouraging patients to use their medications better,” says William Shrank, an assistant professor of medicine in the division of pharmacoepidemiology at Brigham and Women’s Hospital in Boston. “They are an underutilized resource.”

At Stamford, Conn.-based customer-communications company Pitney Bowes Inc., on-site pharmacist Antonio Tierno says he talks with patients about their conditions and medications. If a patient is picking up a refill behind schedule, he’ll ask what’s up. “If a person is late, you need to find out why,” he says.

Mr. Tierno says he always asks patients if they know why they’re taking a drug. That conversation can help ensure that patients will take their medication, he says, by making the drug’s benefits clearer to them and by making them feel more involved in their care.

A study by researchers at the Walter Reed Army Medical Center in Washington, D.C., published in the Journal of the American Medical Association, found that a pharmacy-care program for 200 people age 65 and older who were taking at least four medications for chronic conditions boosted adherence to 97% from 61% after six months. Patients were educated about their medications, including usage instructions; medications were dispensed in blister packs that made it easier to keep track of whether they had taken their pills for the day; and pharmacists followed up with patients every two months.

After 12 months, those who continued to get the pharmacy care kept their adherence at about 96%, while adherence among those for whom the program was discontinued dropped to 69%.

Another review of efforts to improve adherence—sponsored by CVS Caremark Corp. and carried out by Dr. Shrank and other researchers from Brigham and Women’s Hospital, Harvard University and CVS—found that nurses talking with patients as they were discharged from the hospital were right behind pharmacists in terms of how often they successfully encouraged patients to take their medications as directed.

Treat Patients as Individuals

Every patient’s story is different—so every solution has to be tailored to the individual.

The first step is to engage the patient with a simple, open-ended question, says Elizabeth Oyekan, area pharmacy director at Kaiser Permanente South Bay Medical Center: What’s getting in the way of picking up your medications?

“That will give you some concrete information, and then you target the solution to the individual patient,” she says. Kaiser has created a set of online tutorials to help doctors and others engage more effectively with patients who are skipping their medications.

If a patient is worried about side effects, a health-care provider might offer a substitute for the medication, or a lower dose. For the forgetful, it could be as easy as using a simple pillbox, or maybe something more technologically advanced, such as text-message reminders or souped-up pillboxes with audio or visual alerts.

If money is the problem, the solution may be generic substitutes, a mail-order program (which not only provides drugs at a lower cost but also helps those who have trouble getting to a pharmacy), or a drug company’s assistance program.

In many cases, though, problems can be addressed only by looking at medication adherence as a behavioral issue with often complex roots, says Alan Christensen, chairman of the psychology department at the University of Iowa. As with diet and exercise, getting people to change their behavior can be difficult.

“There’s more and more interest in how to better motivate and engage patients beyond just simply reminding them or reducing financial barriers or simplifying therapy,” says Dr. Shrank. Multifaceted programs that entail various combinations of those elements and education delivered by health-care professionals have shown promise in studies, but “we don’t have a good sense of what precisely is the right mix,” Dr. Shrank says. And, he says, if that ideal mix turns out to involve a lot of expensive face time, someone will have to figure out how to implement those efforts in a cost-effective way.

DAW Prescriptions May Add $7.7 Billion To Healthcare Costs

March 25, 2011 By: Nadia Category: HealthCare, Medicine Advice, Medtipster, Prescription News, Prescription Savings

www.Medtipster.com Source: CVS Caremark – 3.25.2011

Approximately five percent of prescriptions submitted by Pharmacy Benefit Management (PBM) members in a 30-day period during 2009 included a “dispense as written” (DAW) designation. This practice – whereby doctors or patients demand the dispensing of a specific brand-name drug and not a generic alternative – costs the health care system up to $7.7 billion annually, according to a new study by researchers at Harvard University, Brigham and Women’s Hospital. Moreover, these requests reduce the likelihood that patients actually fill new prescriptions for essential chronic conditions.

In a study published this week in the American Journal of Medicine, the researchers demonstrate that DAW designations for prescriptions have important implications for medication adherence. They found that when starting new essential therapy, chronically ill patients with DAW prescriptions were 50 to 60 percent less likely to actually fill the more expensive brand name prescriptions than generics. “Although dispense as written requests would seem to reflect a conscious decision by patients or their physicians to use a specific agent, the increased cost sharing that results for the patient may decrease the likelihood that patients actually fill their prescriptions,” the researchers said.

“This study shows that dispense as written requests are costing the health care system billions,” said William H. Shrank, MD, MSHS, of Brigham and Women’s Hospital and Harvard, and the study’s lead author.  “The further irony is that patients with prescriptions specifying a certain brand seem less likely to fill their initial prescriptions, adding to the medication non-adherence problem.”

“Previous to this study, little was known about the frequency with which doctors and patients request dispense as written prescriptions,” said Troy A. Brennan, MD, MPH, Executive Vice President and Chief Medical Officer of CVS Caremark and a study author. “Those who advocate for dispense as written and argue that the practice provides patients and physicians with greater choice will probably be surprised to learn that the practice increases costs and exacerbates non-adherence.”

The study reviewed 5.6 million prescriptions adjudicated for two million patients from January 1 to January 31, 2009. The review found that 2.7 percent of those prescriptions were designated DAW by doctors, while another two percent were requested DAW by patients.

If existing safe and effective generic alternatives had been provided in place of those brand-specific prescriptions, patients would have saved $1.7 million and health plans would have spent $10.6 million less for the medications.  The researchers said that assuming a similar rate of DAW requests for the more than 3.6 billion prescriptions filled in the U.S. annually, patient costs could be reduced by $1.2 billion and overall health system costs could be reduced by $7.7 billion.

The study is a product of a previously announced three-year collaboration with Harvard University and Brigham and Women’s Hospital to research pharmacy claims data in order to better understand patient behavior, particularly around medication adherence.  Annual excess health care costs due to medication non-adherence in the U.S. have been estimated to be as much as $290 billion annually.

Medicine is the best medicine; help patients keep taking it

December 07, 2010 By: Nadia Category: HealthCare, Medicine Advice, Medtipster, Prescription News, Prescription Savings

www.Medtipster.com Source: Boston Globe, 12.3.2010

Patients who don’t take their medications are a well-documented problem in medicine. If doctors are to spot patients who might stop complying with prescriptions, it’s vital to have a fuller understanding of why and how it happens.

As many as 40 to 60 percent of those with chronic conditions like high blood pressure, heart failure, or diabetes don’t take their medicines regularly. The reasons vary – some patients never fill their prescriptions; others feel better and stop their drug regimens; in still other cases, side effects or the burden of too many pills discourage patients from refilling their prescriptions. Whatever the motive, failing to take needed drugs leads to worse health and higher spending, as patients land in the hospital for preventable conditions that cost the health care system hundreds of millions of dollars a year.

But a new study this month in the Annals of Internal Medicine, by researchers at Brigham and Women’s Hospital and Harvard Medical School, shines the spotlight on another contributor: Patients not picking up prescriptions that have already been filled.

The analysis, funded by CVS Caremark, looked at over 10 million prescriptions filled over a 3-month span in 2008 and found that 3.3 percent were never picked up. The number seems small, but translates to 110 million abandoned prescriptions per year in the United States. It costs a pharmacy an estimated $5 to $10 to prepare, then return to the shelves, an unclaimed medication, so the authors estimate the problem could be costing more than $500 million a year. CVS Caremark has a clear interest in bringing that number down – but so do patients and doctors.

The problem could worsen as technology evolves: Prescriptions sent electronically were 65 percent more likely to be left behind, probably because they bypass the step of having the patients hand- deliver a slip to the pharmacist. As electronic prescribing continues to take hold nationwide, insurers should be vigilant that prescription fill rates may reflect compliance less accurately than with traditional prescriptions.

Not surprisingly, prescriptions with $40 to $50 copays were the most likely to be abandoned. According to William Shrank, the study’s main author, this means that during economically hard times “even insured patients are experiencing sticker shock, and walking away from the pharmacy, without filling essential medications.”

Doctors are unlikely to know their patients’ copays for drugs, but taking the time to talk about drug costs would help them identify those who might never pick up their prescriptions. Down the road, those extra minutes of chat time at the office become multiple dollars saved at the hospital bedside.

Health Secretary Warns of Insurance Scams

April 07, 2010 By: Nadia Category: Medtipster, Prescription News

www.medtipster.com blog article source: www.nytimes.com – Author: Jackie Calmes

Health Secretary Warns of Insurance Scams

The secretary of health and human services, Kathleen Sebelius, wrote to state officials on Tuesday to urge that they take action against “scam artists” reportedly marketing fake insurance policies to exploit the new law overhauling the health care system.

“Unfortunately, scam artists and criminals may be using the passage of these historic reforms as an opportunity to confuse and defraud the public,” Ms. Sebelius said in a letter to state insurance commissioners and attorneys general.

In the letter and in a speech at the National Press Club, she described reports of people setting up toll-free telephone numbers and going door-to-door peddling phony policies, in some cases falsely claiming that the new law established a limited enrollment period for buying government-subsidized insurance.

Ms. Sebelius compared the alleged scams to reports during the H1N1 flu epidemic of sales of counterfeit flu treatments, and called on the state officials to investigate and prosecute any reported cases of insurance rip-offs.

She also said her department was alerting seniors groups to beware of fraudulent sales pitches. The insurance exchanges to be established under the law do not take effect until 2014, although states can get federal aid in the meantime to set up insurance pools for high-risk individuals to buy policies more cheaply than they can on their own.

In her speech, Ms. Sebelius described additional steps that her department is taking this week to implement the health insurance overhaul that President Obama signed into law last month. The department is issuing guidelines for private Medicare Advantage plans to include cost-sharing protections for seniors and new options for Medicaid to cover low-income adults.

She also announced a “Medicare dashboard” on the department’s Web site where users can search Medicare data on spending for inpatient hospital care and sort it by state, hospital and condition “to give consumers, purchasers and providers the health information they need to make smarter choices.”

Mini Clinics Increase share 15% over last 24 Months

November 16, 2009 By: Nadia Category: Medtipster, Prescription News

Nádia - your personal pharmacy cost adviser

Nádia - your personal pharmacy cost adviser

WASHINGTON, Nov. 16 /PRNewswire/ — Despite the recession, overall growth of the heath care retail clinic market has increased approximately 15 percent in the past two years, according to a new report released today by the Deloitte Center for Health Solutions. Retail clinic market growth, however, will likely slow to 10-15 percent from 2010 through 2012 and will accelerate above 30 percent from 2013-2014, according to the report.

The report, “Retail Clinics: Update and Implications,” suggests that consumer adoption of retail medicine is strong and growing. Additionally, the report suggests that the industry’s potential to expand its revenue opportunities will support its long-term sustainability. The four factors that will likely contribute to the sector’s growth include:

•Increased use and satisfaction by consumers
•Increased use and acceptance by commercial health plans and large employers
•Increased services provided through the retail medicine model
•Increased demand for preventive and primary health care services as a result of health reform and consumer demand

“The growth and evolution of retail clinics reflect opportunities for disruptive innovation and an improved value proposition of price, quality and service for the U.S. health care system,” said Paul Keckley, Ph.D. and executive director, Deloitte Center for Health Solutions. “While the current economic downturn has incited a period of contraction, the retail clinic industry will emerge with a more refined business model to drive a second, albeit slower, wave of growth in the next three years.”

Key findings highlighted in the report include:

•Patient Volume Remains Strong: According to the report and Deloitte’s 2009 Survey of Health Care Consumers, 33 percent of consumers indicate they are willing to use a retail clinic, especially younger and middle-aged working adults. Moreover, 30 percent of respondents are likely to use a retail clinic if it would cost them 50 percent less than seeing their physician.

“Retail clinics represent a new channel that can deliver primary care services more conveniently and at lower cost to consumers,” added Keckley. “Clinic services are typically safe and effective, due in large measure to medical management programs that are evidence-based and supported by electronic medical records. Additionally, health insurance plans are increasingly offering coverage of retail clinic visits in their benefits packages for individuals and employers — ‘covered lives’ is a key to growth.”

•Existing Locations: Most retail clinics operate in retail pharmacy settings (82 percent), or as a department or wholly-owned subsidiary of the host organization, such as a grocery store (12 percent) or big-box discount store (6 percent). Notably, 2009 has seen increased activity by acute care organizations entering retail medicine via contractual arrangements with drug store and grocery chains.

•Potential Locations: The market potential for retail clinics remains strongest in retail pharmacies, as within 10,000 retail pharmacies, there are currently 801 clinic locations. However, big-box discount stores and grocery stores have expansion opportunities if these channels selectively leverage services, given:
•Within over 5,000 big-box discount stores, there are currently only 58 clinic locations
•Within over 5,000 grocery stores, there are currently only 115 clinic locations

•The Evolving Business Model: Core services at retail clinics typically include preventative health screenings, prescriptions and over the counter (OTC) therapeutics and uncomplicated primary care. The retail clinic business model is capable of supporting additional revenue streams (zones) unrelated to its core operations:
◦Zone Two: Core extenders including medication management, health coaching for chronic issues and employee wellness
◦Zone Three: New revenue programs including care management services for chronic issues; referral management services for acute, specialty or OTC issues; and health insurance for individuals or groups

•Challenges to Growth: The retail clinic industry faces a few challenges, including labor shortages, compensation inflation, price pressures from new entrants and regulatory pressures from state governments — all of which may slow growth or impede retail clinics from opening. In fact, in some states and localities, regulators are fearful that retail clinics represent a compromise to safe and effective care. Additionally, some local physicians have actively campaigned against retail clinic openings and advised patients to seek care elsewhere.

“As a new entrant to the health care industry, retail clinics represent a threat to many traditional health care stakeholders,” added Keckley. “However, to consumers, health plans and employers, retail clinics offer an important health care alternative with a strong value proposition. Therefore, we expect this new sector to mature while growing its scope of services, locations and impact on population-based health status.”

Find your nearest retail clinic by using medtipster.com

Pharmacists provide education about medicines

July 29, 2009 By: PharmaSueAnn Category: Medtipster, Prescription News

In addition to dispensing medicines that cure illnesses and improve health, pharmacists provide education about medicines, help people manage and adhere to complex regimens, ensure drug safety, avert dangerous drug interactions, prevent overmedication, offer immunizations and screenings, advocate for access to medications and provide extensive health resources and educational services to the public. The practice of pharmacy involves so much more than merely counting pills.

Furthermore, these services are offered in community pharmacies, clinics, hospitals and nursing homes nationwide. In fact, 92 percent of Americans live within five miles of a community pharmacy, according to the National Community Pharmacists Association. Pharmacists do not require an appointment. Many pharmacies are open on evenings, weekends and holidays. Some are even open 24 hours a day.

No other health care provider offers this level of accessibility. As such, pharmacists must be recognized for the significant contributions they make to their communities, to the public’s health and to the entire health care system.

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