Avoidable Costs in Healthcare
Avoidable Costs in Healthcare
Healthcare
The $200 Billion Opportunity from Using Medicines More Responsibly
June 2013
Introduction
Considerable research on healthcare system inefficiencies and strategies to address them has been undertaken in the U.S. based on a widespread recognition of the urgency of cost containment. Each year since 2008, a different institution has quantified avoidable costs and potential savings across a myriad of healthcare issues. Their results have yielded a wide range of valueseach significant, but varying considerably.1,2,3 For example, in 2008, NEHI (formerly the New England Health Institute) identified $680 billion in avoidable costs;4 in 2010, Thomson Reuters set the amount at $3.6 trillion;5 and in 2011, Donald Berwick and Andrew Hackbarth pointed to $476 billion to $992 billion in avoidable costs.6 These studies sustain an ongoing discourse about both the magnitude of the problem and possible interventions. Given the cost and difficulty of obtaining accurate and up-to-date data, most research draws from and improves on previous efforts. This report, with its focus on use of medications in the healthcare system, offers an innovative perspective in three respects:
It applies a consistent lens the use of medicines to assess medication value in the context of
wasteful spending in the healthcare system. It leverages the latest information, including proprietary data gathered by the IMS Institute for Healthcare Informatics, to account for changes in healthcare costs, including costs for medications and for outpatient, inpatient, and emergency room care. It provides actionable priorities for various healthcare stakeholders, including physicians, patients, pharmacists, payers, policymakers and the pharmaceutical industry. This study focuses on the U.S. healthcare system, but the analysis draws on the global Responsible Use of Medicines report issued by the IMS Institute in October 2012.7 It is intended to advance the national dialogue on optimizing healthcare delivery and cost, and to shift the discourse from medicine costs to the value of pharmacotherapy in reducing overall healthcare expenditures. The study was produced independently by the IMS Institute for Healthcare Informatics as a public service, without industry or government funding.
Murray Aitken
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Acknowledgements
The contributions to this report of Silvia Valkova, Mila Gorokhovich, Naomi Sacks, Michael Kleinrock and many others colleagues at IMS Health are gratefully acknowledged. The authors would like to express sincere gratitude to people who have given their time and expertise toward the development of this report. These individuals have provided chapter reviews, content input, methodology guidance, and constructive critiques to make this report meaningful and useful. Caleb Alexander (Johns Hopkins Bloomberg School of Public Health) Rebecca Burkholder (National Consumers League) Niteesh Choudhry (Harvard Medical School, Brigham and Womens Hospital) Barry Dickinson (American Medical Association) Michelle Drozd (Pharmaceutical Research and Manufacturers of America) Lauri Hicks (Centers for Disease Control and Prevention) Tom Hubbard (NEHI) Haiden Huskamp (Harvard Medical School Department of Health Care Policy) Kathleen Jaeger (National Association of Chain Drug Stores) Tom Menighan (American Pharmacists Association) Robert Narveson (Thrifty White Pharmacy) Phil Schneider (National Community Pharmacists Association) Nilay Shah (Mayo Clinic) Katie Suda (University of Tennessee Health Science Center College of Pharmacy) Find out more Ron Weinert (Walgreens) Tim Weippert (Thrifty White Pharmacy)
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Contents
EXECUTIVE SUMMARY Advancing RESPONSIBLE Medicine Use in the United States: A $200 Billion Opportunity Medication Nonadherence Delayed Evidence-based Treatment Practice Misuse of Antibiotics Medication Errors Suboptimal use of generics Mismanaged Polypharmacy in Older Adults Case Studies of Recent and Innovative Interventions Priorities for Promoting RESPONSIBLE Medication Use CONCLUSION References Cited AUTHORS About the Institute
1 3 7 12 16 20 23 27 30 44 47 48 55 56
2013 IMS Health Incorporated and its affiliates. All reproduction rights, quotations, broadcasting, publications reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or any information storage and retrieval system, without express written consent of IMS Health and the IMS Institute for Healthcare Informatics
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Executive Summary
Wasteful spending in the U.S. healthcare system is a widely acknowledged and seemingly intractable problem. The country is still recovering from a long economic downturn, and imperatives to reduce the increase in costs across all areas of the healthcare system are increasingly prominent in discussions about the distribution of limited dollars. Healthcare costs caused by improper and unnecessary use of medicines exceeded $200 billion in 2012, according to IMS Institute for Healthcare Informatics estimates. This amount is equal to 8% of the nations healthcare spending that year, and would be sufficient to pay for the healthcare of more than 24 million currently uninsured citizens. These avoidable costs arise when patients fail to receive the right medications at the right time or in the right way, or receive them but fail to take them. This report examines avoidable costs in six opportunity areas involving different diseases and care situations: nonadherence, delayed evidence-based treatment practice, misuse of antibiotics, medication errors, suboptimal use of generics, and mismanaged polypharmacy. This study finds that even though avoidable costs are significant, encouraging progress is being made in addressing some of the challenges that drive wasteful spending in many parts of the healthcare system. Medication adherence among large populations of patients with three of the most prevalent chronic diseases hypertension, hyperlipidemia and diabetes has improved since 2009 by about 3%. The proportion of patients diagnosed with a cold or the flu both viral infections that do not respond to antibiotics who inappropriately received antibiotic prescriptions has fallen from 20% to 6% since 2007. And, for diseases where lower-cost generic medications are available, use of generics reached 95% in 2012. A large number of pilot programs and initiatives have, in recent years, advanced the understanding of the underlying causes of improper prescription and use of drugs, and have led to the development of new techniques and approaches to address the issue.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
EXECUTIVE SUMMARY
Such improvements are possible only through collaboration among multiple healthcare stakeholders: providers, pharmacists, patients, payers, pharmaceutical manufacturers and policymakers. The reports case studies demonstrate that the most effective and innovative approaches being taken to address any of the six areas of avoidable costs cannot be planned or implemented singlehandedly. In addition, healthcare informatics the use of technology and analytical approaches to harness the value of data is a key driver of improvements. This report identifies actions that all healthcare stakeholders can take to address the avoidable costs currently incurred by the U.S. healthcare system due to medications not being used according to the best evidence-based clinical practice. These priorities represent the best thinking in the six areas of opportunity identified, and in many cases are consistent with the direction and intention of elements of the Patient Protection and Affordable Care Act.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Advancing Responsible Medicine Use in the United States: A $200 Billion Opportunity
Responsible use of medicines can eliminate at least $213 billion in avoidable costs by addressing six key areas, or levers of opportunity illustrated in Exhibit 1: nonadherence, delayed evidence-based treatment practice, antibiotic misuse, medication errors, suboptimal generic use, and mismanaged polypharmacy. In 2012, more than $2.7 trillion was spent on healthcare in the U.S.,8 so $213 billion represents nearly 8% of the nations healthcare spending that could be avoided. That amount equals the funding required to pay for the healthcare of more than 24 million people who are currently uninsured. Over the next several years, the use of medicines is expected to increase due to expansion of insurance coverage, rising incidence and prevalence of chronic disease and population aging. This places an even greater importance on ensuring those medicines are being used appropriately.
20.0
11.9
1.3
213.2
Nonadherence
Antibiotic misuse
Medication errors
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Advancing Responsible Medicine Use in the United States: A $200 Billion Opportunity
Avoidable healthcare costs are incurred across all sites of care. Exhibit 2 shows that two thirds of the total estimated avoidable costs, or $140 billion, relate to ten million hospitalizations, while $45 billion of avoidable costs are associated with 78 million outpatient visits. An additional $22 billion is incurred in avoidable pharmacy costs related to 246 million prescriptions, and four million avoidable emergency room visits cost $6 billion. Along with these significant costs, the inappropriate use of medicines also imposes an enormous burden on the U.S. healthcare system overall, including patients and caregivers. The avoidable healthcare cost figures are based on estimates and assumptions with a degree of uncertainty. Therefore avoidable costs are estimated in the range of $140-295 billion and are based on a sensitivity analysis of lever-specific measures, such as the level of nonadherence or the risk of complications resulting from nonadherence and delayed evidence-based treatment.
Exhibit 2: $213 billion includes unnecessary healthcare utilization and scripts and affects millions of people
US$213 Bn Millions of lives a ected
10 million hospital admissions $140 $45 78 million outpatient visits 246 million prescriptions 4 million emergency room visits $6
Avoidable costs, US$Bn
Source: Avoidable costs in healthcare study
$22
Utilization
The findings of this analysis are consistent with a previous assessment of global avoidable healthcare costs undertaken by the IMS Institute for Healthcare Informatics. Through a global modeling approach, the cost burden attributable to the U.S. was estimated at $222 billion in 2011, with a similar cost distribution between the same six levers of opportunity, although based on a slightly different set of diseases. This report is developed specifically for the U.S. healthcare system and takes advantage of the greater availability of information on healthcare utilization and costs in the U.S. available both from IMS and published research.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Advancing Responsible Medicine Use in the United States: A $200 Billion Opportunity
The methodology and information sources used in this report are limited in various ways. One of the constraints of this analysis is the use of healthcare claims data derived from a commercially insured, under-65 patient cohort. These patients do not represent morbidity patterns in the overall U.S. population; additionally, healthcare costs are also understood to differ across payment sources. Medication costs, where used in the calculation of avoidable costs, reflect exmanufacturer prices and do not include off-invoice discounts and rebates. Finally, some of the information based on peer-reviewed publications is dated and may not reflect trends and events in 2012. Limitations specific to avoidable cost estimates for each lever are listed in greater detail in the Appendix. Medication nonadherence and delayed evidence-based treatment practice are the key contributors to avoidable costs, accounting for 68% of the total. The definitions for each lever are adapted from the IMS Institutes global report on the Responsible Use of Medicines and include disease-specific and non-disease-specific attributes. The definitions are as follows: Medication nonadherence. This occurs when patients do not take their medicines appropriately or at all. Nonadherence can result in costly complications that are often more expensive than the medicines and worsen health outcomes. The diseases assessed for nonadherence are hypercholesterolemia, hypertension, diabetes type 2, osteoporosis, HIV and congestive heart failure (CHF). Delayed evidenced-based treatment practice. This occurs when medicines are not delivered to patients at a time that would be most valuable in terms of health outcome and cost effectiveness. Screening and diagnostic capabilities could support timely medicine use for highly prevalent diseases and ensure that patients receive medicines to prevent or delay relatively costlier complications. The diseases assessed for delayed treatment are hepatitis C, diabetes type 2, atrial fibrillation, and coronary heart disease (CHD). Misuse of antibiotics. This occurs due to misdiagnosis or inappropriate decisions by prescribers and dispensers to provide patients with antibiotics. Ease of access, low cost, and misperceptions about antibiotics potency against severe diseases contribute to their misuse and overuse, particularly against viral infections. This problem often results in downstream avoidable costs through hospitalizations, promotion of antimicrobial resistance, and, consequently, more expensive treatment.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Advancing Responsible Medicine Use in the United States: A $200 Billion Opportunity
Medication errors. These occur across four processesprescribing, preparation/dispensing, administration, and monitoringand often result in costly complications. Healthcare professionals are not always supported in reporting errors, nor do they necessarily have access to training and tools to help them improve their performance. Suboptimal use of generics. This occurs if there is an unexploited opportunity for greater use of safe, less costly generics in the market once patented drugs have lost their legal protection. The opportunity varies by therapy class. While generics are already used almost exclusively in many areas, in others, brands are still prescribed and dispensed despite the availability of therapeutically equivalent, lower-cost generics. Mismanaged polypharmacy. This occurs when healthcare professionals do not, or cannot, adequately oversee patients who take multiple medicines concurrently. The risk of costly and adverse events increases with age, particularly when patients are over 60 years old, and when patients take more than five medicines concurrently. In this study, avoidable costs are quantified based on a customized modeling approach for each of these six levers. The methods are explained in detail in the Appendix. The estimated avoidable costs are defined as the difference between healthcare utilization costs incurred for patients suffering complications, resulting from suboptimal medicines use, and patients with the same disease who experienced no complications. The underlying assumption is that suboptimal medication use specifically puts patients at risk, leads to harmful health outcomes and results in avoidable healthcare utilization. The final estimate is expressed as a monetary range to reflect the uncertainty of the parameters used in the approach.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Medication Nonadherence
The avoidable cost opportunity from nonadherence is $105 billion, with a range of $68 billion
to $146 billion.
Among the six diseases analyzed in the study, hypercholesterolemia and diabetes have the
biggest impact on avoidable costs.
Despite the substantial avoidable costs incurred in different settings of care, there are
encouraging signs that secondary nonadherence is improving for three of the most prevalent chronic diseases.
The lower cost of widely used medicines after the loss of patent protection, as well as the
growing number of effective interventions by pharmacists, healthcare professionals and payers, are driving these improvements in adherence.
105.4
105.4
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Medication Nonadherence
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Medication Nonadherence
Quantification approach
This analysis is disease-focused and based on research showing that nonadherent patients have a higher likelihood of experiencing complications that result in additional healthcare service utilization, defined as additional emergency room visits, hospitalizations, pharmacy scripts, and outpatient professional, facility and home health visits. The analysis is based on the specific complications described in Table 1. This focus on a specific and limited number of diseases and complications implies that the cost estimates are conservative and underestimate the true avoidable cost value.
Disease
Hypercholesterolemia Diabetes Hypertension Osteoporosis HIV Congestive heart failure (CHF)
This analysis covers two distinct types of nonadherence primary and secondary nonadherence and also takes into account the impact of patent expirations on medicine costs. Primary nonadherence occurs when a new medication is prescribed for a patient, but the patient does not obtain the medication, or an appropriate alternative, within an acceptable period of time after it was prescribed.28 Recent figures from IMS Health show that among patients taking medicines for CHF, those receiving a prescription for the first time have a fill rate of only 75%.29 In other words, 25% of patients who have been diagnosed and given a prescription have not actually picked up the prescription. For patients with osteoporosis, the first prescription fill rate is only 63%.30 Many existing measures of avoidable costs do not account for primary nonadherence, and therefore are likely to underestimate the problem. This factor is not well studied because of historic difficulties in tracking prescriptions written by physicians but not filled by patients.31
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Medication Nonadherence
10
Secondary nonadherence occurs when patients do not refill their prescriptions on time, do not take medications as prescribed or discontinue their medications altogether.32 The magnitude of secondary nonadherence is better understood and measured more extensively than primary nonadherence. 33,34 However, secondary nonadherence estimates often have two disadvantages: they are based on small patient samples in narrowly defined settings of care, or are outdated. Secondary nonadherence measures used in this analysis range from 32% for oral diabetes therapies to 40% for cholesterol medications, and are based on 2011 administrative data covering over 2 million patients.35 Existing studies rarely account for the impact of patent expiries on medicine costs. They typically use outdated information on drug prices, and therefore often find that the higher medication spending associated with greater adherence exceeds reductions in non-medication spending.36,37,38,39 However, recent and ongoing patent expirations, as well as generic prescribing increases, have led to lower prescription medication costs for many patients. Ongoing research that takes into account prescription drug market changes and links that data to adherence rates is needed. Existing studies have a number of problems that limit their application. Most are heterogeneous in sources used and outcomes measured, and cite results from earlier studies to demonstrate the magnitude in present-day context. These studies do not reflect changes in medication price, drug availability and healthcare treatment patterns, nor changes in levels of adherence over time. This study leverages, where possible, IMS Health data for 2012 values, which take into account the latest costs of treatment and estimates of recent primary and secondary nonadherence rates based on large samples of provider prescribing and patient fill/refill data, as well as health plan claims data.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Medication Nonadherence
11
Exhibit 4: Historical trends in adherence to chronic disease therapies among new patients since 2009
65%
Share of patients with PDC* > 80%
60%
55%
50%
45% June 2009 - Feb 2010 June 2010 - Feb 2011 June 2011 - Feb 2012 June 2012 - Feb 2013
Hypertension
Hyperlipidemia
Diabetes**
Notes: * PDC is proportion of days covered by medication on hand. ** Diabetes adherence trend distortion for new therapy starts between 2009-2010 and 2010-2011 likely caused by rosiglitazone restrictions and saxagliptin launch. For the purposes of this measure of trends in adherence data point is excluded in the chart. Source: Avoidable costs in healthcare study
Adherence improvements are associated with two factors. The first is the lower cost of medications for major chronic diseases. The loss of patent protection of widely used medicines has resulted in the availability of low-cost generic alternatives, making therapy affordable for more patients. The second factor is the growing number of interventions by various healthcare stakeholders and at different junctures of the healthcare system aimed at keeping patients on therapy. The body of knowledge about promoting adherence is growing. Also, the scale of these interventions is greater as technology enables more patients to be reached and high-risk patients to be identified and proactive intervention approaches developed. This encouraging news should provide impetus to invest further in adherence interventions and critically examine their effectiveness.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
12
Among the four diseases analyzed, diabetes has the largest impact, representing 90% of
avoidable spending.
A substantial part of avoidable costs is incurred through outpatient and inpatient care as a
result of higher or premature morbidity.
Providing patient treatment at the right time requires a better understanding and systematic
tracking of the reasons for delayed evidence-based medicine use.
39.5
39.5
19.8 35.3
14.4
2.1
1.3 0.7
HCV Diabetes
Source: Avoidable costs in healthcare study
4.4 0.9
ER Hospital Pharmacy Outpatient
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
13
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
14
Quantification approach
This analysis is focused on appropriate pharmacologic treatment and pharmacologic quality of care indicators. Current prevalence measures are used to estimate the number of patients with each disease. Then, estimates of the percentage of patients who have been subject to treatment delays are documented, as reported in peer reviewed published literature and public surveys. Peer reviewed literature also is used to estimate the risks of complications and adverse events that result from treatment delays. IMS Health data is used to estimate the costs associated with those complications and adverse events. Table 2 below lists evidence-based treatment for each disease, as well as the complications that can develop when that treatment is delayed.
Disease
Hepatitis C Coronary heart disease (CHD) Diabetes
Resulting complications
Liver transplants, cirrhosis, chronic liver disease49,50,51,52 Myocardial infarctions53,54,55 Chronic kidney disease56,57,58,59
Warfarin therapy for patients 65 and older who have AF for more than 48 hours
Stroke60,61,62,63,64
While quality measures for quantifying delays in use of medications exist, aggregate national-level estimates of the avoidable costs associated with these delays are not available. Nevertheless, evidence on the prevalence of delayed use of medications suggests that the scale of the problem is not negligible. For example, one study in 2006 found that pharmacologic care guidelines were followed only 61.9% of the time.65 This finding supports earlier findings of underuse of guideline-recommended pharmacotherapy for patients with common and costly chronic conditions, including diabetes.66
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
15
For hepatitis C, estimates of treatment rates are low, at 20%, despite indications that avoidable costs increase if delivery of medication is delayed.67 These rates are associated with the two most common forms of treatment, pegylated interferon and ribavirin, which can prevent or delay disease progression and the associated economic burden of advanced disease.68 Among patients with coronary heart disease, diabetes, and atrial fibrillation, the use of available lowcost medicines also is suboptimal. Among CHD patients, outpatient use of aspirin for secondary prevention of cardiovascular disease is estimated at approximately 24%.69 Among diabetic patients with proteinuria, studies have reported treatment rates of approximately 50%.70,71 Proteinuria is a sign of chronic kidney disease (CKD), which can result from diabetes, high blood pressure, and diseases that cause inflammation in the kidneys.72 Among patients with AF, the National Stroke Association has reported that while most AF-related strokes could be prevented with blood thinners, up to two-thirds of AF patients who had strokes are not prescribed these medications. 73,74 Also, only 50% of AF patients who meet criteria for use are prescribed warfarin.75 Existing literature describes suboptimal treatment of patients across these four diseases, but there is little or no available evidence on the economic impact. This study offers a new perspective on the value of tracking and measuring the consequences of delayed medication use. Although it is possible to track a given complication back to the lack of appropriate medication treatment, few institutions do this. It is a difficult undertaking that requires providers to determine when the delay started or track events backwards from the complication if it is known that the patient was not given the appropriate medicine on time. Additionally, making causal inferences from delayed medicine use to complications is a challenge for clinicians, since there may be other reasons for the complication. Complications can occur even when patients receive medicine therapy on time. Keeping these challenges in mind, yet recognizing that this is a crucial issue that requires further understanding, the goal of this approach is to drive a discussion about the health outcomes and economic consequences of suboptimal care within the healthcare system. This analysis suggests that the reasons for delayed evidence-based medicine use are poorly understood, not systematically tracked, and stand in the way of providing patient treatment at the right time.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
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Misuse of Antibiotics
The avoidable cost opportunity from antibiotic misuse is $35 billion, with a range of $27 billion
to $42 billion.
Inappropriate use of antibiotics is driven by various systemic and human factors, and continues
to exacerbate antibiotic resistance which in turn contributes to substantial avoidable healthcare costs.
There are encouraging signs that efforts to use antibiotics responsibly are paying off,
particularly in declining prescriptions for the common cold and flu.
35.1
965 272
31 9
34.1
368
11
6 3 2
Pharyngitis Bronchitis Sinusitis
48
Otitis Media
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Misuse of Antibiotics
17
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Misuse of Antibiotics
18
The cost of excessive antibiotics prescribed in outpatient settings is $1 billion. The bulk of these unnecessary prescriptions are issued for bronchitis, sinusitis and pharyngitis; however, the rate of antibiotic prescribing substantially exceeds the rate of bacterial infection for these diagnoses, according to Exhibit 7.
20
15
10
0 Common cold & Acute respiratory infections Pharyngitis Sinusitis Bronchitis Otitis Media
Quantification approach
Existing efforts to quantify the impact of antibiotic misuse have focused on the setting of care. In the inpatient setting, costs are commonly defined as the added cost of treating a patient with an antibiotic resistant infection relative to a patient with an antibiotic susceptible infection. The most widely cited cost estimate for the inpatient setting is $24 billion to $38 billion in 2009 dollars, a national-level extrapolation by Susan D. Foster of the Alliance for Prudent Use of Antibiotics in 2010. 91,92 By contrast, in the outpatient setting, estimates from the early 2000s indicate that the costs of excess antibiotic prescriptions for predominantly viral infections could reach between $726 million and $1.1 billion.93,94,95
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Misuse of Antibiotics
19
This study follows established methodologies to provide updated avoidable costs. Inpatient and outpatient costs are assessed separately, following Fosters methodology on the inpatient side, and using IMS Health prescription data to provide cost estimates of unnecessary prescriptions in the outpatient setting. On the inpatient side, we are able to update existing estimates to 2012 cost levels. On the outpatient side, we applied a new analysis leveraging previous research96 and the most recent available estimates from IMS Health proprietary data of diagnosed visits for respiratory conditions and the frequency in which antibiotics are prescribed.97 Given that previous estimates date from the early 2000s, this analysis substantially adds to the understanding of the magnitude of antibiotic prescribing for upper respiratory tract infections. Other contributors, such as the wider effects of high antibiotic use in livestock and agriculture on human resistance to antibiotics, have not been included in this analysis.98
More responsible antibiotic prescribing for the common cold and flu
Despite continuing antibiotic misuse, an encouraging trend is emerging in the prescribing of antibiotics for the common cold and flu. Since 2007, the proportion of patients diagnosed with a cold or the flu both viral infections that do not respond to antibiotics who inappropriately received antibiotic prescriptions has declined from 20% to 6%, as shown in Exhibit 8.99 This signals the positive impact of efforts to increase awareness about increasing pathogen resistance and to adopt a more responsible use of antimicrobial therapies.
Exhibit 8: Antibiotic prescriptions for the common cold and flu are declining
10
Number of diagnoses and prescriptions (Mn)
20%
20% 15%
Rate of inappropriate prescribing
14%
6
12%
10%
7%
7%
6%
5% 0%
2007
2008
2009
2010
2011
2012
Antibiotic prescriptions
Source: IMS NDTI, Dec 2012
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
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Medication Errors
The avoidable cost opportunity from medication errors is $20 billion, with a range of
$15 billion to $28 billion.
Medication errors resulting in avoidable costs are concentrated in the inpatient care setting
and impact approximately 4 million avoidable hospital admissions.
In the outpatient setting, medication errors result in 1.4 million avoidable office visits.
Exhibit 9: Avoidable costs due to medication errors
Avoidable costs, US$Bn
20.0
0.2 0.2
Pharmacy* Outpatient Hospital
*Note: Refers to Pharmacy-related avoidable costs to switch prescription rather than the cost of the prescription itself. Source: Avoidable costs in healthcare study
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Medication Errors
21
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
Medication Errors
22
Avoidable health costs due to medical errors reached $20 billion in 2012, with $18 billion spent on 4 million inpatient care admissions and $1.5 billion spent on 1.4 million outpatient visits, according to Exhibit 9. Avoidable pharmacy-related and emergency room costs were lower at $158 million and $153 million, respectively.
Quantification approach
Many studies articulating the reasons why medication errors occur are from the mid-2000s. It was during this period that the use of electronic prescribing methodsor e-prescribingbegan to increase. This suggests that medication error measures in the existing literature may be outdated and warrant new research. No evidence links the cost of medication errors to the error-prone processes (e.g., prescribing, dispensing, etc.). Since the literature on ADEs indicates dichotomous rates for avoidable costs based on setting, this study stratifies inpatient and outpatient costs and applies a methodology to generalize those costs to the total population. The rate of avoidable ADEs in the inpatient setting was obtained from the NEHI and Massachusetts Technology Collaborative study conducted in 2008.112 The rates were generalized nationally and applied to the total annual number of discharges from U.S. hospitals. Many studies focus on an isolated or targeted impact of medication errors and ADEs, or both, such as inpatient versus outpatient incidents, or rates versus cost. By contrast, this study aggregates all of the most recent figures relevant to medication errors in order to provide a total avoidable cost estimate.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
23
85 million prescriptions could be prescribed and dispensed using low-cost, safe generic
alternatives instead of unprotected brands.
Although the U.S. has already achieved a higher level of generic utilization than any other
country, there is still room for increasing generic efficiency within many therapy classes.
11.9
Pharmacy Scripts* 85 Mn
*Note: Refers to prescriptions which could be switched to generics. Source: Avoidable costs in healthcare study
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
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Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
25
2007
2008
2009
2010
2011
2012
26
Quantification approach
While a generic efficiency of 100% is rarely possible, therapy classes such as antihypertensives, analgesics, antibiotics and antidiabetics already are in excess of 98% generically efficient. In this report, potential health system savings from increased generic efficiency are calculated for therapy areas where generic efficiency is currently below 98%. The calculation estimates potential savings based on the availability of low-cost and safe generics, assuming no changes in utilization and using the latest available information for the cost difference between branded and generic medications. The analysis considers the potential substitution of no-longer-protected brands (off-patent brands) with available generic alternatives. CNS therapies, thyroid preparations, and oral contraceptives are excluded from analysis, and the total avoidable cost does not include increased efficiency in these areas, due to concerns about generic substitution or clinical practice guidelines discouraging the use of generics. In 2012, branded medications in these categories made up 3% of brand spending and 9% of brand prescriptions in the U.S. Generic efficiency in 2012 was calculated for each therapy class as the ratio of generic prescriptions to the sum of generic and off-patent brand prescriptions. This estimate is based on monthly branded and generic prescriptions at molecule and form level and excludes from the calculation months in which generic alternatives were not available, e.g. if the branded product was still protected in some months during 2012.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
27
Most of these costs are incurred through inpatient care and emergency room visits and
hospitalizations due to complications and adverse drug events.
The growing share of older adults of the overall U.S. population makes polypharmacy an
increasingly relevant challenge.
1.3
1.1
0.2 0.1
Outpatient ER Hospital
Source: Avoidable costs in healthcare study
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
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100% 79% 65% 52% 42% 34% 27% 21% 16% 13% 10% 7% 6% 4% 3% 2% 2% 1% 1% 1%
11 12 13 14 15 16 17 18 19 20+
10
Complex medication regimens carry the risk of drug interactions and cause adverse reactions. Among older adults, additional factors that may lead to mismanaged polypharmacy and adverse events include increased frailty and the higher likelihood of co-morbidities and errors in self-administration of medications. The likelihood of an adverse event increases among older patients whose medications are not carefully tracked and managed.126 Mismanaged polypharmacy in older adults is a risk also due to body composition, metabolic and absorption changes that occur with advancing age. The majority of adverse events among older adults involve patients using five or more concurrent medications, and two-thirds of adverse events are attributable to only four medication classes (either alone or in combination): warfarin (33%), insulins (14%), oral antiplatelet agents (13%), and oral hypoglycemic agents (13%).127 As the number of older adults in the U.S. population continues to rise those age 65 and over are projected to increase from 40 million in 2010 to 71 million by 2030128 polypharmacy management among this particularly vulnerable group will grow in importance.
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Quantification approach
Supporting evidence on how mismanaged polypharmacy results in costly adverse events has been assessed with a focus on older adults.129,130 However, there are no existing estimates of the costs associated with ADEs that result from mismanaged polypharmacy among older adults independent of medication errors. This is believed to be the first report to quantify total medical costs associated with mismanaged polypharmacy. Since these costs have not been estimated previously, a new algorithm was developed to estimate avoidable costs based on existing evidence of the challenge and risks. The calculation focuses on older adults in the U.S., and considers existing literature on the prevalence of mismanaged polypharmacy and risks of adverse events driving additional healthcare utilization. Estimates in this study reflect current costs for hospitalizations, physician visits, and emergency department visits, representing a more comprehensive look at the total costs involved.
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Case study 1
CareFirsts Patient-Centered Medical Home achieved $40 million in savings through chronic disease management by primary care providers.
Levers Improved adherence Evidence-based clinical practice Managed polypharmacy Optimal generics use Fewer medication errors Rational antibiotic use
Intervention
Launched in January 2011 across Maryland, the District of Columbia and Northern Virginia, CareFirsts PatientCentered Medical Home (PCMH) program is designed to address the shortage of Primary Care Physicians (PCP), reduce healthcare costs, and improve care coordination quality for members, primarily those with chronic illnesses.131 The goal is to provide PCPs a more complete view of their patients needs and the services they receive from other providers. CareFirsts PCMH program involves 80% of primary care physicians and nurse practitioners in the region. The program provides incentives in the form of higher reimbursement, fees for creating and maintaining customized patient care plans, and bonus payments for achieving better cost and quality outcomes. Through internet access and a web-based tool, providers are able to maintain a detailed online member health record and care plan. Registered nurses, community-based local care coordinators and CareFirst regional staff also are members of the teams that engage with patients, gather and analyze comprehensive data on CareFirst patient populations, and identify opportunities for care improvement and cost savings. In the two years since CareFirst launched the PCMH program, nearly 3,600 primary care providers in 283 PCMH Medical Care Panels (groups of primary care physicians, nurse practitioners, community pharmacists) and one million CareFirst patients have joined the program, making it the largest of its type in the country.
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Outcomes
In its first year the program achieved savings of $40 million132 by reducing unnecessary hospital admissions and ER visits by patients with chronic diseases. The best performing healthcare providers reduced their patients overall health costs 4.2% from the level of expected costs in 2011, while general cost savings for all other providers averaged 4% higher than expected in 2011. Provider reimbursement increased 20%, in addition to a 12% increase paid to all participants who remained in good standing in the PCMH program. The cost of care for all CareFirst members attributed to PCMH participants was 1.5% lower than had been projected for 2011.
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Case Study 2
Centers for Medicare and Medicaid Services medication therapy management programs demonstrate positive impact on chronic disease outcomes and healthcare costs.
Levers Improved adherence Evidence-based clinical practice Managed polypharmacy Optimal generics use Fewer medication errors Rational antibiotic use
Intervention
Medication therapy management (MTM) programs target high-risk, high-cost Medicare Part D patients with a variety of chronic medical conditions, and strive to optimize therapeutic outcomes while reducing the risk of adverse events through improved medication use. They represent a multi-stakeholder effort to improve chronic care quality and management, and to reduce costs. Pharmacists and various healthcare professionals working within a Part D MTM program provide customized patient care by conducting annual one-on-one comprehensive medication reviews (CMRs) and quarterly targeted medication reviews (TMRs), developing personal medication lists and medication-related action plans. They also reach out to physicians and other healthcare professionals on behalf of patients to resolve medication-related problems.133 CMS set out to identify the impact of 2010 Part D MTM programs on Medicare beneficiaries adherence, medication use, drug therapies and resource utilization associated with hospital and emergency room (ER) visits, medications and costs. The evaluation134 focused specifically on high-cost, high-risk beneficiaries with two diseases: congestive heart failure (CHF) and chronic obstructive pulmonary disease (COPD). These patients were expected to benefit significantly from MTM program interventions.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
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Outcomes
The impact on patients health was identified in claims data within a six-month outcome period. Additional analyses considered the impact of MTM programs in the context of organizations of different sizes and varying approaches to CMR implementation, as well as the managed versus fee-for-service types of Medicare Part D plans. According to the study findings, patients enrolled in MTM programs experienced significant improvement in the quality of their drug regimens. MTM programs consistently helped improve adherence and discontinue the use of high-risk medications for both CHF and COPD patients. Comprehensive medication reviews demonstrated a positive impact across most outcomes for patients who received them. Patients who received CMR experienced significant improvements in the quality of their drug regimens, while those who did not incurred on average about $1,034 more in inpatient costs during the study period. The programs impact on other drug therapy outcomes, hospital and ER visits, and other resource utilization, including costs, was less consistent. At the overall level for both Part D plans and Medicare Advantage Part D plans, the study found significant cost savings associated with all-cause hospitalizations, but not for COPD- or CHF-specific hospitalizations. Given that MTM programs target improvements in medication therapy across all chronic conditions of any participating patient, the interventions were very likely successful in improving outcomes related to conditions other than CHF and COPD. Another interesting finding identified larger cost savings for COPD patients than for CHF patients, most of whom were already adherent to their medications. Finally, apart from lowering inpatient and emergency room costs, the analysis suggested that MTMs may generate additional Medicare Part D cost savings through the promotion of cost-effective medications, including generics, and by identifying treatment duplication.
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Case Study 3
Thrifty Whites community pharmacy programs improve adherence to chronic disease therapies by fostering pharmacist engagement with patients.
Levers Improved adherence Evidence-based clinical practice Managed polypharmacy Optimal generics use Fewer medication errors Rational antibiotic use
Intervention
In 2011 Thrifty White, a Minnesota-based, 89-store drug chain with pharmacies across six Midwest states, introduced various programs aimed at giving pharmacists more time to engage with patients and play a role in improving health outcomes. Pharmacists usually have limited time for each patient, since their primary function is to fill prescriptions. This often results in little or no interaction with patients beyond the dispensing of medications. Through MedSync, patients with chronic diseases receive automated phone calls with reminders to pick up refills or alert the pharmacy about a prescription medication change. In a program called Ready Refill, prescriptions are prepared in robotically dependent, central-fill facilities without compromising safety or accuracy, and can be delivered to a patients home or workplace. A majority of patients choose to pick up medications at the pharmacy, where pharmacists provide counseling, discuss potential adverse effects, and conduct comprehensive medication reviews or other medication therapy management services.135 Additional Thrifty White initiatives designed to improve adherence include HealthyPackRx Compliance Packaging for multi-dose prescriptions. Individual packets provided to patients simplify the way they take medications and reduce the risk of medication errors.
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Outcomes
According to Thrifty White/ Virginia Commonwealth University Study results in Exhibit 14, one year after these programs began, adherence among patients in the program increased up to 26% across three chronic diseases.
Exhibit 14: Thrifty Whites Med Sync program increased medication adherence
Percent of Patients Adherent to Medication Therapy
84%
86%
87%
PDC Goal
62%
62%
61%
Cholesterol
Diabetes
Hypertension
Note: Patients are considered adherent with a proportion of Days Covered (PDC) of 80% or greater. Source: Thrifty White/Virginia Commonwealth University study, 2012
These results are based on a population of 3,300 patients enrolled in the MedSync program and 45,000 patients receiving standard pharmacy services from Thrifty White. Depending on the drug class, patients enrolled in the program had 3.4 to 6.1 times greater odds of remaining adherent, compared with patients outside the program. Conversely, control patients had a 52% to 73% greater likelihood of becoming non-persistent, compared with patients enrolled in MedSync. As of 2012, nearly 17,000 patients with an average of four concurrent drug therapies for chronic conditions had enrolled in the MedSync program.136
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Key capabilities enabling this intervention included:137 Technology for automated filling of prescription medications, automated reminder calls to patients, video conferencing between pharmacies to receive expert advice from an available pharmacist at a different location. Incentives to motivate and empower pharmacists to adopt the new patient service model and participate in the program, with a long-term plan and clearly defined objectives and benefits. Training programs offered to other pharmacies and healthcare stakeholders who can benefit from the approach and the lessons learned. Thrifty White is also implementing an intervention program for patients in assisted living and home care settings aimed at screening polypharmacy, identifying medication errors and improving adherence. In addition, the pharmacy chain is collaborating with local hospitals to develop medication adherence solutions during transitions of care.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
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Case Study 4
The National Consumers Leagues Script Your Future campaign challenges multi-stakeholder teams to develop creative, collaborative solutions to nonadherence.
Levers Improved adherence Evidence-based clinical practice Managed polypharmacy Optimal generics use Fewer medication errors Rational antibiotic use
Intervention
The National Consumers League (NCL) is spearheading the largest consumer-facing campaign in the U.S. aimed at improving medication adherence among chronically ill patients and their families.138,139 The Script Your Future campaign involves all healthcare stakeholders - healthcare professional groups, government agencies, adherence researchers, and consumer, insurance, business, and pharmaceutical organizations. While the program was created assuming that no one solution by a single stakeholder group can sufficiently address nonadherence, Script Your Future centers on patients and patient empowerment. The campaign encompasses public education and marketing efforts at national and regional levels, research and targeted outreach initiatives, and other activities in six pilot cities. NCL intervention efforts surround consumers with messages about the importance of adherence and its impact on the entire family. The campaign also provides tools and information about improving communications between patients and healthcare professionals specifically targeting adherence. One such tool is a wallet card, available in multiple languages, with questions that patients should ask during doctor and pharmacy visits in order to understand the severity of their condition, the benefits and importance of their medication regimen, and the steps they can take to improve their health.
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A major 2013 campaign event is the Medication Adherence Team Challenge a project that challenges student pharmacists, as well as faculty and students preparing for other healthcare professions, to develop creative approaches that raise awareness about medication adherence. The program encourages interdisciplinary student teams from pharmacy, medicine, nursing, and other health professions to tackle the problem of poor adherence.
Outcomes
Since 2011, the campaign has attracted more than 130 public and private healthcare stakeholder organizations and institutions, including the U.S. Surgeon General. Notably, the campaign partnered with the Million Hearts initiative, the Centers for Disease Control and Prevention, and the Office of the National Coordinator for Health IT. To date, the campaign has disseminated more than 450,000 wallet cards and 40,000 posters in multiple languages to consumers and healthcare professionals nationwide at pharmacies, community centers, work places, clinic offices, health fairs, and local events. In 2012 alone, the program introduced 30,000 healthcare professionals to Script Your Future materials to be used during patient visits. The campaigns website has registered more than 70,000 visits and thousands of adherence-tool downloads. The 2013 Team Challenge enrolled more than 85 schools and over 1,700 participating students. Through the 2013 campaign intervention, more than 12,000 patients were counseled as part of an effort that has reached a total of at least 3 million people.140 The impact of the campaign on adherence will be formally evaluated in 2014, but benchmark surveys have been conducted at national and pilot city level with over 3,000 patients. Key findings reveal that communication about adherence between patients and healthcare professionals needs to improve, and that the most useful solutions are question lists, reduced co-pays, automatic prescription refills and seven-day pill boxes.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
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Case Study 5
Walgreens becomes the first retail chain to lead an accountable-care organization and expands chronic disease diagnosis and management services.
Levers Improved adherence Evidence-based clinical practice Managed polypharmacy Optimal generics use Fewer medication errors Rational antibiotic use
Intervention
In April 2013 Walgreens announced an expansion of chronic disease diagnosis and management services at more than 300 in-store clinics in 18 states.141 Nurse practitioners and physician assistants will offer patients with asthma, diabetes and high cholesterol services that include testing and diagnosis of the chronic condition, prescribing medication therapy, providing referrals for additional testing, and managing the disease. Walgreens also is the first pharmacy to establish an accountable-care organization (ACO). The pharmacy chain is partnering with Advocare and its physicians to provide care to more than 500,000 patients in southeastern Pennsylvania and New Jersey, and is participating in two other ACOs with physician groups in Florida and Texas. Walgreens in-store clinics already provide a broad range of healthcare services, especially screening and immunizations. The ACO model further advances the sharing of information about pharmacy and in-store clinic services with physicians and payers, and enables better coordination of care. It also helps eliminate the duplication of services, improve treatment outcomes, reduce costs and increase patient satisfaction.
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Walgreens considers pharmacists and the staffs of its in-store clinics to be an extension of healthcare in the community. The pharmacy chain intends to close existing gaps in primary care through links to physicians and healthcare information technology.142 Services to be provided include blood pressure and blood glucose monitoring, screenings, smoking cessation programs and immunizations. Some of these services can be conducted entirely at pharmacies, while others will be handled by partnering physicians. Through ACOs, Walgreens aims to improve connections between primary care physicians and its pharmacies during transitions of care.
Outcomes
Early indications show that Walgreens ACOs are having a significant impact. In the first four months of existence, the ACO organizations, which manage healthcare for approximately 50,000 patients, demonstrated hospital readmission levels at half the national average. More importantly, Walgreens ACOs are achieving a fundamental transformation of physician perceptions about pharmacies and the benefits of this new kind of partnership. The new options for accessing primary care health professionals may attract patients looking for convenience and cost savings. Care costs at in-store clinics are lower than identical services performed in doctors offices and emergency rooms. Walgreens chronic disease management services have the potential to address some of the anticipated primary care workforce problem that will result when millions of newly insured people enter the U.S. healthcare system.
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Case Study 6
CVS Caremarks Pharmacy Advisor program improves medication adherence and increases therapy initiation rates.
Levers Improved adherence Evidence-based clinical practice Managed polypharmacy Optimal generics use Fewer medication errors Rational antibiotic use
Intervention
In the belief that face-to-face and one-on-one time with a pharmacist is an effective solution to improve health outcomes and care, especially for patients with chronic conditions, CVS Caremark launched Pharmacy Advisor.143 The program engages members who are diagnosed with chronic conditions when they are most receptive to messages about their prescribed therapy face-to-face when members choose to fill prescriptions at the pharmacy or by phone from the Pharmacy Advisor Call Center when members choose home delivery. These integrated tactics drive behavior change over time and lead to better clinical outcomes. In addition to improving medication adherence, the program saves money and enhances the quality of treatment. The program also closes gaps in care and directs members with chronic conditions to existing disease management programs where they can obtain additional support. Pharmacy Advisor was launched in 2011 with a focus on diabetes. In 2012 the program was expanded to include chronic cardiovascular care, with the specific goal of improving medication adherence for four conditions: high blood pressure, high cholesterol, coronary artery disease (CAD) and congestive heart failure (CHF). The program was expanded in 2013 to include support for patients with asthma, breast cancer, chronic obstructive pulmonary disease (COPD) and osteoporosis.
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Outcomes
A research study published in Health Affairs in January 2012144 found that the Pharmacy Advisor program focusing on diabetes increased both patient medication adherence and physician initiation of prescriptions. The research highlighted the essential role of pharmacists in monitoring patient adherence, improving outcomes and reducing overall costs. Face-to-face counseling can be two to three times more effective than other forms of communication between pharmacists and patients in increasing medication adherence. The study also indicated that face-to-face counseling led to a 3.9% improvement in medication adherence, and an increase of 2.1% in overall medication adherence rates among Pharmacy Advisor patients. Participating employers saved more than $600,000 through healthcare cost avoidance with the intervention group, achieving a return on investment of $3 for every $1 spent on additional counseling. Results from the Pharmacy Advisor pilot demonstrate higher therapy initiation rates for concomitant therapies for diabetes, such as statins, angiotensin-converting enzyme (ACE) inhibitors and angiotensin receptor blockers (ARBs), which are commonly prescribed to diabetes patients for kidney protection. 145 Contacts by pharmacists with patients and their doctors significantly increased therapy initiation rates, closing these common gaps in care by as much as 39% for the full sample and 68% for the group counseled face-to-face at the CVS/pharmacy locations.
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Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
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Priorities for addressing avoidable costs require alignment and collaboration of multiple stakeholders
17
18
Note: The patient stakeholder group includes also patient advocates and caregivers. Healthcare professionals include physicians, nurses, physician assistants, nurse practitioners and healthcare administrators. Payer stakeholders include private insurance companies, government payer agencies and employers.
Pa
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Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
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Conclusion
There are many things U.S. healthcare stakeholders can do to promote the responsible use of medicines, to improve health outcomes and ultimately reduce avoidable healthcare costs. Most of these actions require the involvement of multiple healthcare stakeholders. Considering the priority actions outlined above, the magnitude of the improvement opportunity in terms of avoidable costs, and the timing and investment required by each action, five guiding principles surfaced which need to be pursued aggressively in order to accelerate progress. 1. Consistent focus on high-risk patients who are most vulnerable to suboptimal medicines use and require the costliest healthcare interventions: risk factors, morbidity and health outcomes can help determine the areas of greatest need. 2. Steadfast engagement with patients as responsible and capable partners: pharmacists are particularly well positioned to create and maintain relationships through frequent and direct communication with patients about responsible use of medicines. 3. Rigorous assessment of impact and ROI in the design and implementation of interventions for optimum avoidable cost reduction: smart resource allocation is the key to long-term success. 4. Continuous measurement and accountability for interventions impact on cost reduction and health outcomes: sustainability and scalability of multi-stakeholder partnership depend on effective solutions. 5. Alignment of compensation models with new healthcare delivery models: cost reductions from optimal medicines use need to be shared by participating stakeholders. Reaching some level of consensus and alignment based on measured and proven success models is a necessary step to advance the collective effort to further unlock the opportunity identified in this report.
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137 Personal communication with Robert Narveson, CEO and President of Thrifty White, March 2013. 138 National Consumers League. (2013). Script your future. Retrieved from https://scriptyourfuture.org/about/challenge 139 Bosworth, H. B., & The National Consumers League. Medication adherence: Making the case for increased awareness. Retrieved from http://scriptyourfuture.org/wpcontent/themes/cons/m/Script_Your_Future_Briefing_Paper. pdf 140 Personal communication with Rebecca Burkholder, Vice President of Health Policy at the National Consumers League, May 2013. 141 Appleby, J. (2013). Walgreens becomes 1st retail chain to diagnose, treat chronic conditions. Kaiser Health News. Retrieved from http://www.kaiserhealthnews.org/ Stories/2013/April/04/walgreens-primary-care-services.aspx 142 Personal communication with Ron Weinert, Vice President Healthcare Solutions at Walgreens, May 2013. 143 CVS Caremark. (2013). Our pharmacy advisor program. Retrieved from http://www.cvscaremarkfyi.com/blogs/ourpharmacy-advisor-program 144 Brennan, T. A., Dollear, T. J., Hu, M., et al. (2012). An integrated pharmacy-based program improved medication prescription and adherence rates in diabetes patients. Health Affairs, 31(1), 120-129. doi: 10.1377/hlthaff.2011.0931 145 Personal communication with Dr. Troyen Brennan, Executive Vice President and Chief Medical Officer at CVS Caremark.
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Authors
Murray Aitken
Executive Director, IMS Institute for Healthcare Informatics Murray Aitken is executive director, IMS Institute for Healthcare Informatics, which provides policy setters and decision makers in the global health sector with objective insights into healthcare dynamics. He assumed this role in January 2011. Murray previously was senior vice president, Healthcare Insight, leading IMSs thought leadership initiatives worldwide. Before that, he served as senior vice president, Corporate Strategy, from 2004 to 2007. Murray joined IMS in 2001 with responsibility for developing the companys consulting and services businesses. Prior to IMS, Murray had a 14-year career with McKinsey & Company, where he was a leader in the Pharmaceutical and Medical Products practice from 1997 to 2001. Murray writes and speaks regularly on the challenges facing the healthcare industry. He is editor of HealthIQ, a publication focused on the value of information in advancing evidence-based healthcare, and also serves on the editorial advisory board of Pharmaceutical Executive. Murray holds a Master of Commerce degree from the University of Auckland in New Zealand, and received an M.B.A. degree with distinction from Harvard University.
Silvia Valkova
Senior Manager, Research Support Silvia is a researcher and project manager at the IMS Institute for Healthcare Informatics, leading the development of reports and analyses focused on biopharmaceuticals and healthcare in the U.S. and globally. Silvias primary and secondary market research experience spans clinical biopharmaceutical innovation, pipeline development, launch, loss of exclusivity, generic competition, and the regulatory environment. She has focused particularly on aspects of return on R&D investment, the pace of progress and quality of pipeline products as well as the nuances of patent protection and generic penetration globally. Silvia joined IMS in 2007 and worked in the Market Insights and Thought Leadership teams which in 2011 became the IMS Institute. Prior to IMS, Silvia was a translator and project manager for seven years, translating texts about biopharmaceuticals, reproductive health and consumer marketing from Spanish, German and Bulgarian. Silvia holds a Master of Science degree in Health Research and Communication from Temple University.
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Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
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Research Agenda
The research agenda for the Institute centers on five areas considered vital to the advancement of healthcare globally: The effective use of information by healthcare stakeholders globally to improve health outcomes, reduce costs and increase access to available treatments. Optimizing the performance of medical care through better understanding of disease causes, treatment consequences and measures to improve quality and cost of healthcare delivered to patients. Understanding the future global role for biopharmaceuticals, the dynamics that shape the market and implications for manufacturers, public and private payers, providers, patients, pharmacists and distributors. Researching the role of innovation in health system products, processes and delivery systems, and the business and policy systems that drive innovation. Informing and advancing the healthcare agendas in developing nations through information and analysis.
Guiding Principles
The Institute operates from a set of Guiding Principles:
The advancement of healthcare globally is a vital, continuous process. Timely, high-quality and relevant information is critical to sound healthcare decision making. Insights gained from information and analysis should be made widely available to healthcare stakeholders. Effective use of information is often complex, requiring unique knowledge and expertise. The ongoing innovation and reform in all aspects of healthcare require a dynamic approach to understanding the entire healthcare system. Personal health information is confidential and patient privacy must be protected. The private sector has a valuable role to play in collaborating with the public sector related to the use of healthcare data.
Avoidable Costs in U.S. Healthcare: The $200 Billion Opportunity from Using Medicines More Responsibly. Report by the IMS Institute for Healthcare Informatics.
IMS Institute for Healthcare Informatics, 11 Waterview Boulevard, Parsippany, NJ 07054 USA [email protected] www.theimsinstitute.org