AmeriHealth Mercy/PerformRx

2005 Rx Benefit Innovation Award

Problem Identification

The escalating cost to of providing a comprehensive pharmacy benefit to state Medicaid recipients continues to cause concern for the various state and federal agencies responsible for managing this portion of the health care equation. While a number of states have implemented limited product cost and utilization management programs, the national trend for pharmacy-related expenditures remains in the 13- to 18-percent range. Given the enormous pressure on state budgets, and deficits at the federal level, Medicaid programs nationwide are now beginning to take a more active role in ensuring that they are receiving the most value for their health care dollars. Aggressive product cost control, along with comprehensive drug utilization management programs that include clinical interventions, are critical for managing the Medicaid population, as most states are precluded from obtaining any significant relief using cost-sharing strategies such as recipient deductibles, co-payments, and co-insurance.

Target Audience

The target audience is Medicaid managed care organizations (MCOs) financially responsible for a comprehensive drug benefit through a capitation agreement with the state and state Medicaid fee-for-service (FFS) programs.

Objectives

AmeriHealth Mercy/PerformRx (PerformRx) works with Medicaid FFS and Medicaid MCOs to reduce overall healthcare costs, while maintaining the integrity and improving the quality of the programs and services offered. This is accomplished primarily through aggressive product and service cost negotiation and ensuring the appropriate use of pharmaceutical and biological products through clinical management.

Solution

PerformRx has taken traditional and contemporary utilization management tools, applied them to both oral and specialty injectable drug products, and developed programs focused on the unique needs of the Medicaid population. The programs target high utilizers that are identified using both medical and pharmacy claims data.

The result is a program that includes over 500 point of service edits, including duplication of therapy, maximum/appropriate dosing, step therapy and prerequisite therapy. The program also includes a robust prospective utilization review for specialty injectable products, and a rare disease state management that includes hemophilia and sickle cell anemia.

Impact and Results

PerformRx manages various components of the pharmacy benefit for more than 894,000 Medicaid recipients, including a sizeable number of “dual-eligibles,” enrolled in six MCOs in five states. For those MCOs that have implemented the entire spectrum of product cost and utilization management programs available, Perform Rx has been able to reduce drug trend to single digits, in some cases as low as five percent per year, in contrast to the national Medicaid average prescription trend. Working with its clients, PerformRx has built sustainable, trusting relationships with physician and pharmacy providers so MCO members receive coordinated, high quality care. Utilizing both medical and pharmacy data allows PerformRx to provide evidence-based, patient-specific reporting to prescribers.

Results from programs and interventions implemented in 2004 include:

• A DUR program designed to reduce duplicate therapy of atypical antipsychotics identified about 1,000 individuals using two or more of these drugs. Almost one-third of these individuals were titrated off of at least one atypical antipsychotic with no clinical consequences reported, yielding almost $1 million in savings.
• A dosage conversion initiative for atypical antipsychotics, antidepressants, and mood stabilizers identified more than 2,500 members for intervention. Communication to prescribers resulted in 50% of the targeted population converted to more efficient treatment regimens with higher compliance levels, yielding $700,000 in savings.
• A brand-to-generic conversion program targeted almost 700 users of Clozaril^®, a branded clozapine. Intense detailing of the psychiatric practitioner community with published clinical data documenting comparability of the agents led to more than 50% of the branded users switched to the generic by their physicians which generated $750,000 in savings.
• Specialty pharmacy, has implemented more than 40 clinical protocols designed to encourage appropriate therapy, and focuses on the drugs used for treating cancer, end-stage renal disease, hemophilia, hepatitis C, sickle cell anemia, and respiratory syncytial virus.

For more information about managing drug costs in Medicaid populations, contact Richard Buck at rick.buck@kmhp.com.

Members Only     Education     Publications     Research     Track Legislation     PBM Directory     Industry Partners Directory    Join PBMI     Shopping Cart     About Us     Contact Us     Home     Site Map

Pharmacy Benefit Management Institute, LP     8679 East San Alberto Drive, Suite 101    Scottsdale, AZ 85258-4368     Ph: 480-730-0814    Fx: 480-222-4229