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Mari Edlin is a frequent contributor to Managed Healthcare Executive. She is based in Sonoma, California.
Find out what challenges top the list, and what analysts say can be done about them.
The top three pharmacy challenges for 2018: drug affordability, nonadherence, and pharmacist compensation, may come as no surprise to many of you.
The new year, however, brings some additional challenges to the fore and further complicates the challenges the industry already faces, as outlined by industry experts. The primary impetus is wrought by the fragility of healthcare reform and the new healthcare landscape-a marketplace filled with high-cost drugs; evidence-based care; pharmacy benefits managers (PBMs) facing more pressure to share pricing and rebate practices; expanded roles for pharmacists; and new partnerships formed among insurers, PBMs and pharmacies.
Affordability has long been a concern but has ratcheted up attention with the introduction of high-cost specialty pharmacy moving in to replace drugs off patent or to fill voids in new drug classes. The affordability problem is exacerbated by banner years of drug approvals, often due to accelerated pathways, and blockbuster drugs.
Robert DiGregorio, PharmD, associate dean, clinical affairs, Long Island University-Pharmacy, says prescription drug plans must be affordable to the public while not driving pharmacies and insurance companies out of business. “Everyone needs some margin,” he says. “The obvious challenge is to be able to provide effective care at the lowest cost.”
John Corcoran, founder/president of Trinity Partners, a global life sciences consulting firm, questions how the high price of some drugs can be justified. “You have to look at value and if drugs improve quality of life and decrease the burden of disease, not just at safety and effectiveness,” he says. “If there are superior outcomes, payers will be willing to cover expensive drugs, but Pharma needs to respond.”
Corcoran points to other factors impacting drug affordability: aging baby boomers; longer life expectancy; and increased prevalence of obesity, dementia, and Alzheimer’s-all affecting drug utilization. “The industry needs to understand and acknowledge these changes in the marketplace,” he says.
There have been some innovative solutions to combat high costs, says Mike Rogers, managing director, RX Solutions, the pharmacy benefits management consulting arm of NFP, “but there is little control over drug inflation.” He blames manufacturers and pharmacies for the high prices, however, he acknowledges the necessity of providing appropriate drugs to patients with cancer and chronic illness-regardless of their high costs.
Rogers offers up a few solutions: looking at data to determine drug utilization, who is taking what, and if there are alternatives. Placing responsibility on payers, including employers-he recommends narrow formularies and pharmacy networks to leverage better pricing.
Drug adherence is a perennial problem, and of course, drug affordability is a big contributor.
“Patients receive prescriptions and either don’t take them or don’t refill them because they find them to be too expensive or they feel asymptomatic,” says Bernard Tyrrell, associate dean, pharmacy and industry relations, Keck Graduate Institute, a private graduate school. “Antibiotics, drugs with a short course of therapy, however, might be an exception.”
He says mail order improves access to drugs for chronic diseases, but patients often don’t understand how to take the medication correctly. “Mail delivery creates an impersonal relationship,” he says.
He places some responsibility for the nonadherence problem on pharmacists. He says they could help reconcile a patient’s regimen to ensure drugs are taken correctly.
Kelly Ann Barnes, vice president, pharmacy verification and information for PharmacyChecker.com, which verifies U.S. and international online pharmacies and compares prescription drug prices, agrees that cost is a major driver of nonadherence.
“There are new factors affecting drugs today-higher prices, company mergers, and higher cost generics that often are no longer low-cost alternatives to branded drugs,” she says. “Not taking medications is a revolving issue with many consequences.”
Like Tyrrell, she says pharmacists are in the best position to remedy the problem.
Karla Anderson, partner, PwC an advisory and tax service firm, says “a new role” is needed for retail pharmacies, helping them become an integral part of established healthcare. “Now retail pharmacies can’t just be convenient; they also have to prove value by committing to finding solutions to pharmacy challenges, connecting to patients, and improving engagement and partnering with other healthcare stakeholders,” she says.
Appropriate reimbursement for pharmacists-especially community pharmacists-is a third major challenge.
Tyrrell and DiGregorio agree that pharmacists are not being compensated for services beyond dispensing drugs even though they are providing cognitive services, such as medication management, patient education, and counseling; reducing polypharmacy; promoting adherence; and giving wellness and prevention screenings.
Enhanced medication therapy management is one of the few mechanisms enabling reimbursement for community pharmacists. Tyrrell says legislation is needed to turn the situation around.
Pharmacists practicing in outpatient hospital or physician office settings have more opportunity to bill for special services. According to the Academy of Managed Care Pharmacy, these pharmacists have three options for reimbursement in a fee-for-service setting:
Pharmacists are not currently recognized as a provider under Medicare and, therefore, cannot bill Medicare directly for services under the Part B benefit.
“Too often pharmacists and PBMs are at odds with each other with reimbursement formulas and policies that have made it hard for pharmacists to survive on a system that has historically been driven by the mark ups of prescription drug products,” DiGregorio says. “Pharmacists do not wish to be compensated in this model, and the need to drive the cost down for PBMs is creating demand for a new model to provide for the cost of professional cognitive services.” He would like to see outcomes tied to reimbursement rates.
“Until pharmacists receive provider status,” Barnes adds, “plans will not compensate them even though their functions have grown.”
Mari Edlin, a frequent contributor to Managed Healthcare Executive, is based in Sonoma, California.