The sharpest tool in the pharmacy benefits manager’s toolbox—the formulary is becoming dull as patents on branded small molecule drugs expire and generic dispensing rates continue their advance toward saturation. And the other favorite tool—prior authorization, is still difficult to brandish at the prescriber-pharmacy level. Phones quit being the primary mode of communication long ago when things got busy and talking to a live person became archaic. Then we fell in love with the fax machine! Now we’ve turned to EHRs, ePrescribing and other health information technology because they facilitate increased access to more complete health information and ultimately improve clinical decisions. Yet, so often when additional information about the patient is required by the pharmacy or claims administer, back to paper we go.
There is a better way: electronic prior authorization (ePA). Rather than exchange information after the treatment plan has been discerned and the prescription has been transmitted to the pharmacy, the time for taking care of PA is at the point of care. And the good news is that there’s no need to start from scratch. There’s a solid ePrescribing and rapidly evolving data exchange infrastructure to build upon. The industry truly is primed for implementing an electronic process for the prior authorization of medications to contain costs, improve administrative efficiencies and upgrade the quality of care.
Managing specialty pharmacy for maximum benefit
In a time when the entire healthcare industry is focused on improving quality and controlling costs—a fast growing segment of pharmacy should be on every payer’s radar. Specialty pharmacy, an expensive class of drugs that include the large molecule biologics, is a rapidly growing segment of the pharmacy spend bucket. In fact, recent studies project that by 2016 nearly half of all prescription drug sales will be for specialty medications. These medications are used to treat complex, genetic, rare and chronic health conditions that affect as many as 133 million in the U.S.
These medications come with a hefty price tag and a lot of administrative requirements. Because specialty medications come primarily in an injectable form they have special delivery, storage and handling requirements. They also often need to be used in a very precise manner, so pharmacies must offer support programs and services to help patients receive the most benefit from their medication. Thus, administering specialty medications adds complexity to a variety of pharmacy workflows.
This kind of expense and complexity means that nearly all—85-90%—specialty medications require PA—adding yet another layer of cost. Managing specialty medication costs and efficacy will be much more difficult without a standardized process for real-time decisions on PA requests at the point of prescribing. Clearly, the rise of specialty pharmacy makes PA the most important PBM tool moving forward, which makes implementing ePA a strategic imperative for health plans and payers. Current PA processes are simply far too cumbersome and, more importantly, often cause delays in needed therapy. You can read more about those PA issues here and in a white paper here.
The technology is there, the standard is ready and states are ready to act as more and more have mandated ePA in the past couple of years. ePA could provide a quick win for health plans and payers.
The long and short of it: plan sponsors will need to better understand the appropriate use of specialty pharmaceuticals as well as develop effective tools to manage their use, and ePA should top the list. Health plans and ACOs will want to think about acquiring specialty pharmacies as a way to control costs, reduce inappropriate utilization and better manage patient care. But to do so, requires increased specialty pharmacy automation, so pushing the ePA standard and implementation along is critical. In addition, adding specialty pharmacies will help plans diversify their portfolios and create synergies with their pharmacy benefit managers to enhance the bottom line.
The next step is for health plans to refine business processes and to establish plans for developing new workflows, working with contracted pharmacies and vendors and educating physician practices. Point-of-Care Partners is intimately familiar with the ePA standard that NCPDP will ballot later this year. Let us know if we can help you develop a strategy for specialty pharmacy and ePA.