Evaluation of Savings from Pharmaceutical Interventions Robin Lunge Steve Kappel January 26, 2007
Ways to Achieve Savings Any effort to address savings must have an effect on prices, utilization, or intensity, preferably more than one. Evaluation must be able to measure that impact
How to Achieve Savings - Prices Reduce reimbursement Negotiated Statutory E.g Medicaid AWP or dispensing fee Increase rebates Purchase internationally Note: any negotiated reduction or rebate increase is a function of moving volume
Ways to Move Volume Preferred Drug Lists Consolidated purchasing State programs State employees and Medicaid State and private Multi-state agreements It is not clear if increasing the volume of purchases without moving volume affects prices
How to Achieve Savings - Benefit limits Utilization Number of brand-name prescriptions per month Prior approval Approval by a third party before prescription will be paid for
How to Achieve Savings - Intensity This is where much of the action is currently Mandatory generic substitution Change physician behavior Counter-detailing Other feedback
How to Achieve Savings - Intensity Change patient expectations Ban direct-to-consumer advertising Preferred drug lists Prior approval Note: some approaches, such as PDLs or prior approval, influence more than one factor.
Two main ways Evaluating Savings Comparison group Gold standard Not practical in ingoing program Historical Easier to perform Subject to other forces difficult to isolate the influence of a specific initiative
Evaluating Savings Other approaches Surveys Prescribers Beneficiaries Other issues Establishing causality Was it the new program or did the rate of growth slow down generally? Scope Include indirect effects like increased physician costs?
What Has Vermont Done? Preferred Drug List Multi-State purchasing Non-Profit PBM Coverage for OTCs Generic Substitution Price disclosure Counterdetailing
What has Vermont Done #2 Marketing disclosure Promoting the use of 340B providers Reimportation / ISaveRx One evaluation issue all the things we ve done!
PDL Basics Evaluation - PDL Focus on therapeutic categories with high spending, multiple brands Professional (prescribers, pharmacists) review alternatives for safety, efficacy If equivalent, select the most cost-effective (consider price and supplemental rebate) Issue: ability to compare efficacy is limited OHSU program
Evaluation of PDLs Topic of many evaluations Vermont Medicaid JFO report (Feb. 2003) Direct measure of savings in three therapeutic categories of about 25 percent Slow-down in growth of spending Increase in rebates Supplemental rebates $10.4 million in 2006
Evaluation of PDLs Florida PDL saved $81 million in 2001-02 (about 4 percent of total spending of about $2 billion). [OPPAGA] Indiana Estimated savings of $12.4 million, offset by a reduction in rebates of $3.5 million (about 1.3 percent of total $642 million) No spill-over into other spending [ACS State Healthcare, LLC]
Evaluation of Generic Substitution Express Scripts annual Drug Trend Report Brand to generic switching nationally reduces spending trends between 1.4 and 2.7 percent annually. This effect has increased between 2000 and 2005
Counterdetailing in Vt OVHA program has not been implemented Requested 2005 report from OVHA Budget requests? Area Health Education Centers (AHEC) 1 hour, case-based interactive sessions At Vermont practices Clinical pharmacist & physician team 2006 Hypertension Cholesterol Heartburn
Evaluation of Counterdetailing Pennsylvania idis (independent Drug information Service) program Goals of evaluation Do prescribing behaviors change? Can changes be attributed to program? Provider survey Strong support for program No findings on specific outcomes
Evaluation of Marketing Disclosures Evidence that marketing has effects on prescribing behavior (JAMA, NEJM) Vermont Attorney General s report, June 2006 Includes fees, travel expenses, gifts, other payments Excludes free samples Valuable information No direct measure of impact
Increasing 340B providers 5 FQHCs Each with multiple sites 2 FQHS look-alikes One with 5 sites NCSL Legisbrief January 2005 No Vermont specific data
Enrollment in I-Save Rx Cumulative through 12/06 242 enrollees 752 orders I-Save Rx estimates savings of 25-80% from U.S. retail prices depending on the medication Reports on savings to Illinois retirees & safety of importing from Canada, Europe & Australia/New Zealand
Questions? This presentation will be available at: http://www.leg.state.vt.us/jfo/default.htm