NACDS chairman: Assert pharmacy’s role in seeking solutions for costly health system
SAN DIEGO If there ever was a time for retail pharmacists to assert their role in a broken and increasingly costly healthcare system, that time is now.
That appeal to chain pharmacy and supplier executives was issued by Larry Merlo, chairman of the National Association of Chain Drug Stores and president of CVS/pharmacy, at the kickoff of the 2010 NACDS Pharmacy and Technology Conference Sunday. In an era of health reform and clearly unsustainable rises in health costs, Merlo told NACDS members in San Diego, “the pharmacist is front and center as an important part of the solution.”
Merlo’s speech at the gathering’s first general business session was an urgent call to action. “We must define the value for pharmacy in a reformed healthcare-delivery system,” he said. “We’ve identified several areas where pharmacy is in the best position to effectively and positively contribute to all three pillars of that healthcare equation: access, quality and cost. But most important of all, we must ensure that the value of the pharmacy industry and its pharmacists [is] recognized by payer reimbursement policies –– not just for the products we sell but [also] for the services we provide.”
Merlo, who succeeded Andy Giancamilli as NACDS chairman in April, ticked off some of the huge challenges facing the U.S. healthcare system. “The current cost of chronic disease in this country is over $1 trillion,” he noted. “Even more frightening is the fact that chronic disease in the United States is projected to grow by 42% over the next 20 years, and cost over $4 trillion, putting it in the ‘epidemic’ category from my perspective.”
Adding to those skyrocketing costs –– which must be borne by public and private health plans and patients themselves –– are the costs arising from patient nonadherence and noncompliance with medication therapy, Merlo noted. “Three-out-of-4 Americans don’t take medications as directed … and 1-of-3 never even fill the script. Nonadherence for our chronic disease population alone … is expected to cost the U.S. healthcare system $290 billion in avoidable and costly health complications.”
Also weighing on most Americans, Merlo said, is the fact that “growth in healthcare premiums versus wages over an eight-year period” shows “premium costs outpacing wage growth by a factor of four times.”
Community pharmacy, deployed as a front-line health resource in collaboration with doctors and other patient-care stakeholders, can help solve some of those tough challenges, according to the NACDS chairman. “We’re positioned to help control the costs of health care by advocating for the value of what I’m calling pharmacy care,” Merlo said. He defined pharmacy care as “the cost-effective treatment of disease, particularly chronic disease, through better mechanisms to promote adherence and effectiveness.”
Calling health reform “a good thing for the country and for our industry,” Merlo nevertheless warned that the overhaul would pose challenges for pharmacy operators. For instance, he said, “as the government grows as a payer, we can expect to see further margin pressure on reimbursement rates.”
“If you look at the basic fundamentals of reform –– quality, cost and access –– it is clear that we have only tackled one of the three reform pillars,” Merlo asserted. “Pharmacy has the opportunity to be a key contributor to lowering healthcare costs over the long term. If we agree that expansion of access makes sense, we need to begin the work on the cost and quality side of the equation.”
On the plus side of health reform, added NACDS’ chairman, “expanded coverage will drive utilization for 32 million Americans currently uninsured, and that will improve health outcomes. We should keep in mind this is on top of the baby boomers hitting senior citizen status; and the fact that the over-65 population is expected to grow 65% by 2025, further increasing the need and use of prescription medications,” he added.
Health reform also is driving more rapid adoption of electronic prescribing and other health information technologies, Merlo pointed out, along with collaborative-care models, increasingly effective pharmacogenomics and such pharmacy-rooted quality-of-care concepts as medication therapy management.
More progress needed in health information technology
WHAT IT MEANS AND WHY IT’S IMPORTANT Since the turn of the 21st century, community pharmacy and its technology allies have waged a long fight to shift the nation’s fractious healthcare system to a common communications and record-keeping platform via electronic prescribing and information technology. Those efforts — led by such companies as Surescripts, the pharmacy industry-founded e-prescribing network — have made progress. But even now, nine years after Surescripts’ launch, roughly two out of every three office-based physicians are scribbling their patients’ prescriptions out on a pad instead of routing them to a pharmacy electronically.
(THE NEWS: White House report on health IT, innovation hailed by e-prescribing pioneer Surescripts. For the full story, click here)
Now that the Obama Administration has unveiled more details of its massive economic stimulus plan for the U.S. economy and, in particular, for the health care industry, the conversion rate among family doctors could accelerate quickly. It’s no surprise that Surescripts CEO Harry Totonis was jubilant at the release of the government’s new report on recovery and innovation.
On Tuesday, VP Joe Biden himself unveiled the report, called “The Recovery Act: Transforming the American Economy Through Innovation.” The report strongly endorses the effort to convert the physician community to paperless prescribing.
In clear recognition of the role e-prescribing can play in a more efficient health system, the White House included Totonis on its guest list at Biden’s release of the innovation stimulus report. The Surescripts CEO expressed strong support for the government’s efforts to drive the health information technology revolution.
By pushing incentives to doctors who convert to digital prescribing, along with federal-private industry pilot projects and clear standards for health IT, “the government has played a leading role in encouraging the adoption of e-prescribing,” Totonis said. The report, he added, “goes further to recognize the greater benefit of e-prescribing and the sharing of medication information [for] saving lives, time and money and improving the quality of care.”
Despite the nation’s stubbornly high unemployment figures, rising deficits and fears of a double-dip recession, the White House maintains that the massive stimulus outlays will lead to long-term recovery. “With over $787 billion in funding, the American Recovery and Reinvestment Act is one of the single boldest and largest investments in the U.S. economy in the nation’s history,” the administration points out in its position statement. “The Recovery Act’s design was three-fold: to rescue a rapidly deteriorating economy; put the country on a path to recovery by putting Americans back to work quickly; and reinvest in the country’s long-term economic future, building a foundation for a new, more robust, and competitive American economy.”
More than $100 billion of those funds are allocated for “innovative and transformative programs,” the White House asserts, and could lead to “game-changing breakthroughs … and in some cases, new American industries.”
The $100 billion will spur “innovation and technology deployment” across a wide range of industries, according to the language of the Recovery Act, including renewable energy and energy efficiency, high-speed rail, broadband access and biofuels. But for pharmacies, physician groups and other health care stakeholders, one segment of that innovation stimulus is key: the $19 billion that will go toward health information technology.
Winning Brands products soon to appear on pharmacy shelves
LOS ANGELES Winning Brands soon will begin selling its cleaning products at independent pharmacies, the company said.
The company, which makes such products as Winning Colours stain remover, will market the products in retail pharmacies through the American Pharmacy Cooperative, Inc.
“APCI is an important organization,” Winning Brands CEO Eric Lehner stated. “There are over 20,000 independent pharmacies in the United States that would benefit from adding Winning Colours stain remover to their product mix.”