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Study: Medication Management Leads to Big Savings


Comprehensive medication management aided by AI clinical decision support can result in a large return on investment in a high-risk population. In this study, every dollar that was invested resulted in $12 in savings or cost avoidance.

A pilot program that used a comprehensive medication management program coupled with an artificial intelligence (AI) platform reduced drug interactions, emergency room visits, and hospital admissions, according to a recent analysis published in the Journal of Managed Care & Specialty Pharmacy.

This program at Inland Empire Health Plan (IEHP) in Ranch Cucamonga, Ca., was able to engage with members via telephone and enhance care coordination, reducing serious drug interactions by 15.2%, emergency room visits by 15%, and hospital admissions by 9%, investigators found.

Investigators estimated the program saved $1.2 million a month and more than $14 million annually for the 2,150 members in the study.

Edward Jai, Pharm.D.

Edward Jai, Pharm.D.

The AI element was a way to improve the consistency of clinical decision making, as well as to stratify IEHP members and prioritize members’ risk, lead author Edward Jai, Pharm.D., IEHP senior director of pharmaceutical services, said in an interview with Formulary Watch. “The AI component is an aspect we wanted to explore to see if we could be more effective in prioritizing our patients’ medication risk and improving on those medication-related outcomes.”

He said the AI helps to identify those members through IEHP data, including claims data, medication claims data, patient laboratory values, their disease states, their diagnoses, utilization of other diagnostics, encounters in the emergency department, hospitalization, lengths of stay.

The AI can take all of these variables and create a risk profile for the 1.4 million IEHP members, the majority of which are part of Medicaid plans. “We can stratify them in real-time to identify any issues,” Jai said.

Investigators found that a comprehensive medication management aided by AI clinical decision support can result in a huge return on investment in a high-risk population. Every dollar that was invested resulted in $12 in savings or cost avoidance.

Investigators determined that the medication management program resulted in a 19.3% reduction in total cost of care that, applied to a preintervention monthly cost of $2,872, yielded a savings of $554 per member per month. Medication costs showed a 17.4% reduction that, when applied to preintervention cost of $1,110, yielded a savings of $192 per member per month.

“We believe Medicaid and Medicare payment of AI enhanced telephonic comprehensive medication management services would substantially decrease government health care expenditures, whereas improving health program expansion to Medicaid members with similar risks could save the health plan $109 million annually. For instance, we estimate that California’s Medicaid (Medi-Cal) program could save more than $1 billion annually by applying the program’s observed impact to a similar high-risk cohort (about 1.6%) of Medi-Cal members,” the investigators wrote in the journal article.

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