Health Care Reform and the New MTM Provisions: What does this Mean for Community Pharmacy? Christopher R. Gauthier, RPh Board Coordinator Maine Pharmacy Association May 16, 2010 Hilton Garden Inn Freeport, ME
Who is your speaker? • Graduated 1994 from University of Rhode Island College of Pharmacy • Varied experience with hospital, clinical, and retail pharmacy • Executive Board member of the Maine Pharmacy Association in all capacities, currently Board Coordinator, for the last 5 years
What we are going to discuss • The new Health Care Reform (HCR) Law • Breakdown HCR into digestible bites that highlight impact on Community Pharmacy • Medication Therapy Management (MTM) Provision • Principles of MTM • Resources for starting your own MTM service
Medicaid Generic Drug Pharmacy Reimbursement (AMP Fix) • Improves the definition of Average Manufactures Price (AMP) so that it includes only manufacturers’ sales to retail pharmacies. It directs the Center for Medicare and Medicaid Services (CMS) to set Medicaid Federal Upper Limit (FUL) for reimbursement of generics a rate of “no less than 175% of average weighted AMP.” • This increase in the FUL is especially important now because the bill also expands Medicaid coverage – starting in 2014 - to individuals up to 133% of the Federal poverty level. This is expected to add 16 million more individuals to the Medicaid program.
What does this mean to us? • The bill requires the Secretary to implement the new Medicaid generic rates as early as October 2010. This means that pharmacies in some states may see a reduction in generic drug reimbursement at that time. However, this new law mitigates the impact of the more draconian generic drug cuts that would have gone into effect had these changes not been made, saving pharmacies approximately $3 billion in Medicaid generic drug cuts. • AMPs for brand and generic drugs will be made public later this year. This will give payers access to more AMP data, which are generally assumed to be close to retail pharmacy’s acquisition costs for drugs.
Pharmacy Benefit Manager (PBM) Transparency in Health Exchanges • PBMs continue to operate in relative secrecy, with payers and the Federal government having little information on whether PBMs actually reduce drug costs, or pass through rebates and discounts to plan sponsors. To begin to rectify unacceptable situation, the health care reform bill requires the PBMs to confidentially disclose important financial information to the Secretary of Health and Human Services for those health plans operating in new health insurance exchanges and Medicare Part D plans. These new state-based exchanges are set to begin in 2014. This is the first federal requirement for oversight and accountability in the PBM marketplace.
What does this mean to us? • Transparency helps to level the playing field between mail order and community pharmacy by encouraging plans to hold PBMs accountable for excessive profits and the tactics used to drive those profits up. • This new law creates an important foundation for future federal regulation. As federal officials learn more about the games PBMs play, they may strengthen disclosure requirements or apply them to additional federal health programs. Hopefully, the private sector will follow suit.
Pharmacists Exempted from Medicare DME Accreditation Requirement • The bill provides an exemption for most pharmacies from the burdensome accreditation requirements to provide Medicare DME, and changes current law so that pharmacy accreditation requirements are not effective until January 2011. (Pharmacies that want to competitively bid would still be required to be accredited regardless). A pharmacy can be exempt from the accreditation requirements if the pharmacy: • Has total Medicare DME billings that are 5 percent or less of total prescription sales. • Has had no adverse fraud or abuse determination against it for the last 5 years • Submits an attestation that its total Medicare DMEPOS billings are and continue to be less than a rolling three year average of five percent of total pharmacy sales. • Submits documentation to the Secretary (based on a random sample of pharmacies) that would allow the Secretary to verify the information.
What does this mean to us? • If you’re already accredited under current CMS guidelines, you are exempt from the re-accreditation requirements if you meet the criteria above. This will save you thousands of dollars and countless hours to comply. • If you’re not accredited now, you are required to be accredited after January, 2011, but only if you do not meet the criteria above. Most pharmacies are likely going to meet the criteria above and will not have to be accredited. If you have already stepped down from selling DME, anticipating that Congress would enact an exemption, we expect CMS to allow pharmacies to step back up soon. This will likely require the submission to the NSC of an application to “step up”.
Pharmacist-Delivered Medication Therapy Management Services • The health care reform bill envisions an expanded patient care role for pharmacists in new health care system models. These new responsibilities will help assure more appropriate use of prescription medications, especially for those patients who have chronic illnesses. These include pharmacist roles in accountable care organizations, medical homes, “transitions of care” teams, and medication reconciliation activities • The bill also includes a Medication Therapy Management (MTM) grant program that will help test new and innovative methods to provide medication therapy management, which will help to reduce the estimated $290 billion in health care expenditures that result from inappropriate medication use or non compliance with taking medications.
What does this mean to us? • Community pharmacies may be eligible for grant funding to help provide MTM services, though the government’s process for establishing grant criteria, applications, etc. will take many months and will be subject to the annual appropriations process.
Closes the Medicare Part D “Donut Hole” • The health care reform bill closes the Medicare Part D “donut hole” over the next ten years (2010-2020), through new Federal funds as well as discounts from pharmaceutical manufacturers on brand name drugs. Beneficiaries that hit the donut hole in 2010 would receive a one-time $250 rebate. Beginning January 1 2011, beneficiaries would also automatically receive a 50 percent discount off the negotiated price for brand-name prescription drugs that are covered under Part D and covered by their plan‘s formulary or are treated as being on plan formularies through exceptions and appeals processes. These discounts would be provided by the pharmacy at point of sale. • The discount increases to 75% on brand-name and generic drugs by 2020. The bill also allows 100% of the negotiated price of discounted drugs (excluding dispensing fees) to count toward the annual out-of-pocket threshold that is used to annually define the coverage gap. Beginning in 2020, the 25% copay applies until Medicare’s catastrophic coverage kicks in.
What does this mean to us? • Medicare patients who previously struggled financially when in the “donut hole” should be able to purchase their full medication regimen as prescribed – leading to increased adherence. However, the law requires that these brand name manufacturer discounts be paid to the pharmacy by a third party entity under contract with the Secretary. The new prompt pay provisions apply to the payments that these third party entities would have to make to pharmacies, which means that pharmacies should be paid within 14 days of dispensing the brand name drug.
New Requirements for Long Term Care Pharmacies • The health care reform bill requires Part D plans to use specific dispensing techniques to reduce pharmaceutical waste in long term care facilities. In order to reduce waste associated with unused medications, starting in 2012, Medicare Part D drug plans and MA-PD plans must have in place utilization management techniques such as daily, weekly, or automated dose dispensing to reduce the quantities of part D drugs dispensed to enrollees residing in long-term care facilities. • The Health and Human Services Secretary will consult with appropriate stakeholders, including State Boards of Pharmacy and pharmacy and physician organizations, to study and determine additional methods to reduce waste.
What does this mean to us? • You may have to provide dispensing services to long term care facilities more frequently, with no statutory requirement that there would be corresponding increases in dispensing fees. NCPA is already advocating with the Centers for Medicare and Medicaid Services (CMS) that full dispensing fees be paid for an increase in the frequency of providing medications to residents of long term care facilities.
Small Business Provisions • The health care reform bill includes provisions that would penalize businesses that do not provide health insurance and whose employees purchase plans through the exchange. However, there are no penalties on businesses with 50 or fewer employees that do not provide health care coverage. The bill also includes small business tax credits to encourage small employers to purchase insurance for their employees
What does this mean to us? • You are not required under law to provide health insurance for your employees. • If you do not provide health insurance coverage for your employees and have more than 50 employees, you may be subject to a $2,000 fine for some of the employees if any of the employees is subsidized to obtain coverage through the new health insurance exchanges. • If you have fewer than 25 employees you may be eligible for tax credits to provide health insurance coverage to your employees.
340B Provisions • The health care reform bill substantially expands the number of entities eligible to obtain pharmaceutical discounts under the 340B program. These 340B entities are supposed to provide discounted prescription medications to uninsured individuals. • The final bill prevents the extension of 340B discount pricing to inpatient services provided by a hospital, which will reduce the number of discounted prescriptions dispensed to potentially inappropriate patients.
What does this mean to us? • While the bill’s expansion language will mean that an increasingly larger number of covered entities will be able to provide discount 340B drugs, NCPA members also have an increased opportunity to participate in the 340B program due to a recently issued HRSA guidance that allows 340B covered entities to contract with multiple pharmacies to provide pharmacy services.
What Is Medication Therapy Management? • Medication therapy management, also referred to as MTM, is a term used to describe a broad range of health care services provided by pharmacists, the medication experts on the health care team. • As defined in a consensus definition adopted by the pharmacy profession in 2004, medication therapy management is a service or group of services that optimize therapeutic outcomes for individual patients. Medication therapy management services include medication therapy reviews, pharmacotherapy consults, anticoagulation management, immunizations, health and wellness programs and many other clinical services. • Pharmacists provide medication therapy management to help patients get the best benefits from their medications by actively managing drug therapy and by identifying, preventing and resolving medication-related problems.
Why Is Medication Therapy Management Needed? • Medication-related problems and medication mismanagement are a massive public health problem in the United States. Experts estimate that 1.5 million preventable adverse events occur each year that result in $177 billion in injury and death.
Where Is Medication Therapy Management Provided? • Pharmacists provide medication therapy management services in all care settings in which patients take medications. • While pharmacists in different settings may provide different types of medication therapy management services, the goal of all pharmacists providing medication therapy management is to make sure that the medication is right for the patient and his or her health conditions and that the best possible outcomes from treatment are achieved.
Who Can Benefit From Medication Therapy Management? • Anyone who uses prescription medications, non-prescription medications, herbals, or other dietary supplements may potentially benefit from medication therapy management services. • People who may benefit the most include those who use several medications, those who have several health conditions, those who have questions or problems with their medications, those who are taking medications that require close monitoring, those who have been hospitalized, and those who obtain their medications from more than one pharmacy.
What kinds of MTM are being performed? • Medication Therapy Reviews • Pharmacotherapy Consults • Disease management coach/support • Pharmacogenomics Applications • Anticoagulation Management • Medication Safety Surveillance • Health, wellness, public health • Immunization • Other Clinical Services
Medication Therapy Reviews • The medication therapy review is a systematic process of collecting patient-specific information, assessing medication therapies to identify medication-related problems, developing a prioritized list of medication-related problems, and creating a plan to resolve them.
Pharmacotherapy Consults • Pharmacotherapy consults refer to services provided by pharmacists on referral from other health care providers or other pharmacists. These consult services are typically reserved for more complicated patient cases, specifically for patients who have complex medical conditions and who have either already experienced medication related problems or who are at high potential to develop them. A pharmacotherapy consult incorporates the pharmacist’s expertise into achieving desired therapeutic goals for patients by promoting safe, appropriate, and cost-effective use of medications.
Disease management coach/support • Disease management principles involve coordinated healthcare interventions for diseases in which patients must assume some responsibility for their care. Pharmacists providing these medication therapy management services address drug and non-drug therapy, as well as lifestyle modifications associated with these diseases integrate the patient into programs that empower them to manage their disease and medications, and thereby reduce healthcare costs and improve quality of life of patients. Diverse disease management programs that incorporate effective medication management have been developed for a variety of chronic disease state such as Diabetes, Asthma, COPD, Heart Failure, Parkinson’s Disease, Alzheimer’s Disease, Depression and many others.
Pharmacogenomics Applications • Pharmacogenomics is a new and emerging medication therapy management service provided by pharmacists in which pharmacists play a role in the interpretation and application of a patient’s genetic information to optimize a patient’s response to medication therapy. In various patient care settings from hospitals to community pharmacies pharmacists are comparing patient-specific treatments based on genetic markers, predicting patients’ response to therapy, dosing medications based on genetic test results, predicting which patients will experience adverse reaction to selected therapies, and making informed recommendations to prescribers on the best treatments for that individual patient that maximize effectiveness while minimizing risk.
Anticoagulation Management • Pharmacists providing anticoagulation management provide diverse services to patients who are taking oral blood thinning agents. Warfarin, the most prescribed oral medication agent for this purpose, must be continuously monitored and managed to ensure patient safety and minimize risk. Pharmacists work with educating many different types of patients on these therapies such as those with atrial fibrillation and at high risk for stroke on the importance of oral anticoagulation adherence and attaining routine blood tests. Pharmacists provide services in anticoagulation management. Examples of services provided by pharmacists include in-pharmacy fingers sticks and INR testing , education on patient self monitoring/management, and adjustment of doses based established collaborative practice agreements between physicians and the pharmacist.
Medication Safety Surveillance • Pharmacists provide medication therapy management through medication safety surveillance programs, where they serve an important role in prevention of medication errors and adverse events. Improving the safety of the medication use system as a whole is critical to achieve optimum therapeutic outcomes for individual patients. From medication error and adverse event reporting to the collection of data and identification of medication safety on an expanded scale, pharmacists are breaking new ground in ensuring medication related safety. Emerging areas include the development, utilization and standardization of Risk Evaluation and Mitigation Strategies (REMS), a program for drugs or biologics that pose specific safety risks for patients, will optimize the balance of patient access and medication safety. REMS programs are being required more and more by the Food and Drug Administration to address potential patient safety issues.
Health, wellness, public health • Pharmacists provide a wide range of health, wellness and public health services to improve care for individual patients in the communities they serve. Examples of services include screening programs for common disease states (e.ge. asthma, diabetes cardiovascular disease) nutritional planning, weight loss, smoking cessation counseling, These services help to address the critical need to improve the overall health and wellness of the U.S. Population.
Immunization • Pharmacists in all 50 states are authorized to provide medication therapy management by administering immunizations under collaborative practice agreements with physicians. Pharmacists provide valuable immunization services and information for patients to improve vaccination rates for vaccine preventable illnesses. Pharmacists provide immunization medication management services through identification of patients based on disease states and medication therapies that could potentially benefit from receiving various vaccines and by directly immunizing those patients or providing education on the benefits and importance of vaccinations for preventable illness. Pharmacist administration authority varies from state to state based on individual scope of practice regulation. As examples, pharmacists administer seasonal flu vaccine, H1N1 vaccine, herpes zoster vaccine, travel vaccines and many others.
Other Clinical Services • As pharmacist provided medication therapy management services continue to evolve, pharmacists roles continues to expand into new and emerging areas. These diverse clinical services all focus on optimizing medication outcomes for the individual patient. Examples of other clinical services in medication therapy management include employee health services & screening, travel medicine, nuclear pharmacy, veterinary pharmacy, nutrition and many others.
MTM Resources • American Pharmacist Association website • www.pharmacist.com • The single best collection of resources that I have seen for starting and managing an MTM service • Plenty of examples and publications with information ranging from process through billing
Thought to leave you with… • Tom Menighan, CEO APhA, on the provisions of the Health Care Reform Law. • “APhA strongly supported the bill’s inclusion of provisions to address our nation’s medication-use crisis. This is an opportunity for us to deliver as the medication experts on the health care team. We opened the door for the recognition of pharmacists’ services. Now we need to continue that work with regulators and our colleague organizations to ensure that patients have the tools that they need to use their medications safely and effectively. The opportunity is there—grasp it!”