Financial incentives and drug spending in managed care.
This study estimates the impact of patient financial incentives on the use and cost of prescription drugs in the context of differing physician payment mechanisms. A large data set was developed that covers persons in managed care who pay varying levels of cost sharing and whose physicians are compensated under two different models: independent practice association (IPA)-model and network-model health maintenance organizations (HMOs). Our results indicate that higher patient copayments for prescription drugs are associated with lower drug spending in IPA models (in which physicians are not at risk for drug costs) but have little effect in network models (in which physicians bear financial risk for all prescribing behavior). (+info)
Who bears the burden of Medicaid drug copayment policies?
This DataWatch examines the impact of Medicaid prescription drug copayment policies in thirty-eight states using survey data from the 1992 Medicare Current Beneficiary Survey. Findings indicate that elderly and disabled Medicaid recipients who reside in states with copay provisions have significantly lower rates of drug use than their counterparts in states without copayments. After controlling for other factors, we find that the primary effect of copayments is to reduce the likelihood that Medicaid recipients fill any prescription during the year. This burden falls disproportionately on recipients in poor health. (+info)
Outpatient antidepressant utilization in a Dutch sick fund.
OBJECTIVE: To identify quality improvement opportunities in the management of depression by evaluating patterns of antidepressant use and concurrent use of anxiolytics or sedative/hypnotics among patients who initiated therapy with amitriptyline, fluoxetine, fluvoxamine, or paroxetine. DESIGN: A longitudinal, retrospective study using electronic prescription data from a Dutch sick fund, ZAO Zorgverzekeringen. PATIENTS AND METHODS: The study patients (n = 2,554) initiated therapy between October 1, 1994 and December 31, 1995. Follow-up periods were 6 months (antidepressant use) and 60 days (concurrent anxiolytic and sedative/hypnotic use). RESULTS: The three key findings were as follows: (1) the majority of patients received less than 4 months of therapy (more common for patients receiving amitriptyline); (2) the average daily doses for initial prescriptions for all four study drugs were below the recommended therapeutic minimums for depression (overall and final amitriptyline doses also were consistently low); and (3) the incidence of concurrent anxiolytic and sedative/hypnotic use during days 2-60 after antidepressant therapy initiation was 18.2%. CONCLUSION: The study suggests that patients in this Dutch sick fund were not likely to receive either adequate antidepressant doses or adequate durations of therapy relative to Dutch guidelines for the treatment of depression. These findings are consistent with findings in other Dutch, European, and US studies and may present opportunities for quality improvement. (+info)
Factors affecting bargaining outcomes between pharmacies and insurers.
OBJECTIVE: To model the bargaining power of pharmacies and insurers in price negotiations and test whether it varies with characteristics of the pharmacy, insurer, and pharmacy market. DATA SOURCES/STUDY SETTING: Data from four sources. Pharmacy/insurer transactions were taken from Medstat's universe of 6.8 million pharmacy claims in their 1994 Marketscan database. Sources Informatics, Inc. supplied a three-digit zip code-level summary database containing pharmacy payments and self-reported costs for retail (cash-paying) customers for the top 200 pharmaceutical products by prescription size in 1994. The National Council of Prescription Drug Programs supplied their 1994 pharmacy database. Zip code-level socioeconomic and commercial information was taken from Bureau of the Census' 1990 Summary Tape File 3B and 1994 Zip Code Business Patterns database. STUDY DESIGN: The provider/insurer bargaining model first employed in Brooks, Dor, and Wong (1997, 1998) was adapted to the circumstances surrounding pharmacy and insurer bargaining. DATA COLLECTION/EXTRACTION METHODS: The units of observation in this study were single Medstat claims for each unique insurer/pharmacy combination in the database for selected pharmaceutical products. The four products selected varied in the conditions they treat, whether they are used to treat chronic or acute conditions, and by their sales volume. Used in the analysis were 9,758 Zantac, 2,681 Humulin, 3,437 Mevacor, and 1,860 Dilantin observations. PRINCIPAL FINDINGS: We find statistically significant variation in pharmacy bargaining power. Pharmacy bargaining power varies significantly across markets, insurers, and pharmacy types. With respect to market structure, pharmacy bargaining power is negatively related to pharmacies per capita and pharmacies per employer and positively related to pharmacy concentration at higher concentration levels. In addition, the higher the percentage of independent pharmacies in an area, the lower the pharmacy bargaining power. With respect to socioeconomic conditions, pharmacy bargaining power is higher in areas with lower per capita income and higher rates of public assistance. CONCLUSIONS: The bargaining power of pharmacies in contract negotiations with insurers varies considerably with exogenous factors. Local area pharmacy ownership concentration enhances pharmacy bargaining. As a result, anti-trust law prohibiting the collective bargaining of independent pharmacies with insurers leaves independents at a disadvantage with respect to chains. (+info)
Pharmacist compensation for ambulatory patient care services.
This activity is designed for pharmacists practicing in ambulatory, community, and managed care environments. GOAL: To discuss issues involved in the transition from product-based to patient-care-based reimbursement and compensation systems for pharmacists. OBJECTIVES: 1. Differentiate between reimbursement and compensation. 2. Describe the limitations of current third-party reimbursement and compensation systems. 3. Describe ways in which compensation for seemingly identical products and services can vary. 4. Discuss the use of Medicare's Resource-Based Value Scale and the relative value unit. 5. Define and differentiate between ICD-9-CM codes and E/M CPT codes. 6. List the three key components needed to determine an E/M CPT code for a new patient seen in the pharmacy. 7. Describe and provide examples of the SOAP method of documentation. 8. Understand why the referral process is an important step in the compensation process. 9. Discuss the importance of Form HCFA-1500 and other documentation in the compensation process. (+info)
Managed care and sexual dysfunction. Based on a presentation by William Parham, MD.
The availability of managed care benefits for the treatment of sexual dysfunction is inextricably linked with cost. An atypically low increase of 4.4% in aggregate healthcare expenditures in 1995-1996 stands in sharp contrast to outlays of more than 11% between 1966 and 1993. Between 1993 and 1996, that increase hovered at about 5%, the result largely of the growth of managed care and low levels of general inflation. However, despite relative containment of overall healthcare expenditures, those related to pharmaceuticals have risen more than 9.2% annually, an increase that reflects the managed care industry's failure to restrain drug costs. In deciding whether it will cover a particular treatment, the managed care industry applies three sets of criteria relating to efficacy, medical necessity, and appropriateness. Managed care companies are expected to counter runaway pharmacy costs for sildenafil by excluding it from coverage, imposing significant limitations, or requiring higher copayments. (+info)
Migraine in managed care. Based on a presentation by Delores Bowman, RN, BSN, CRM.
Migraine, one of the most common conditions reported by health plan members, receives inadequate attention in most managed care settings. The lack of a consistent and concerted approach to the management of patients with the most severe and intractable varieties of migraine is particularly obvious. Studies in our plan population have documented that the availability of effective new pharmacologic antimigraine agents could reduce both sick days and hospital visits. Development of new guidelines for management of migraine patients, including a formulary indicating the availability of agents that have been documented to be effective, will be a critical step in educating physicians as to the proper management of patients with migraine. Such guidelines should also provide specific criteria for referral. Studies that document positive outcomes of new migraine protocols will provide a basis for employer-driven expansion of migraine-related healthcare coverage. (+info)
Is prior authorization of topical tretinoin for acne cost effective?
OBJECTIVE: To determine whether prior authorization of topical tretinoin for acne is in the best interest of health insurers and, if so, to determine the optimal prior authorization age for topical tretinoin. STUDY DESIGN: A retrospective, cross-sectional study of data from the National Ambulatory Medical Care Survey was performed. PATIENTS AND METHODS: We performed a sensitivity analysis using published data on the age distribution for topical tretinoin prescriptions for acne and nonacne indications to estimate the cost of topical tretinoin and the cost of performing prior authorizations as a function of the prior authorization age. RESULTS: A prior authorization age of 25 for topical tretinoin is not cost effective for health insurers. If prior authorization is required, an age threshold of 35 or older is most cost effective. The total cost of topical tretinoin (the sum of the drug costs plus the prior authorization costs) changes little with changes in the prior authorization age; if the prior authorization age is set too low, total costs increase (because the number of prior authorizations increase). CONCLUSIONS: Prior authorization for topical tretinoin is of no great benefit to insurers. As the prior authorization age decreases, the cost of requiring prior authorization increases. Eliminating prior authorization altogether would result in at most a small increase in costs and would be balanced by the benefits to both patients and physicians. (+info)