Telemedicine: A remote connection
NEW YORK —The doctor and the pharmacist will see you now. Just look into the webcam on the computer.
Spurred by a perfect storm of conditions—a fractured economy that has made some pharmacy labor costs prohibitive, an explosion in new digital communications technologies and a flood of new federal cash to spur the adoption of health information technology—pharmacies, physicians and managed care organizations increasingly are turning to telemedicine to bring real-time care to hard-to-reach patients in remote locations throughout the United States.
Linking distant, far-flung patients in real time with pharmacists by a secure dispensing and two-way video-communications kiosk at a clinic, retail site or even a dedicated room in a city hall—which is the case in at least one small town that lost its sole pharmacy—can mean accessible pharmacy care for millions of patients in rural and small-town settings. The potential benefits of telemedicine go way beyond pharmacy dispensing and video-link counseling, of course. Properly applied, telemedicine—more broadly defined by some as telehealth—can put patients in immediate touch with a whole battery of healthcare professionals for any number of interventions. Those interventions can range from smart phones that monitor a diabetic patient’s glucose levels to a trauma team walking a medic through a triage procedure for a wounded soldier on a battlefield in Afghanistan—and can come through mobile phones, webcams or any other device that opens an instant link between patient and practitioner.
One big impetus for the growth of telemedicine will be the federal government. As part of the Obama administration’s $787 billion economic stimulus plan contained in the American Recovery and Reinvestment Act, more than $19 billion has been allocated to support the health system’s conversion to electronic record-keeping and health IT—including telemedicine.
Telepharmacy solutions are coming from a slew of technology providers, sometimes in partnership with retail pharmacy chains. For Maple Grove, Minn.-based Thrifty White Drug Stores, its commitment to remote-site dispensing beginning in 2003 was driven by necessity; the high costs of operating a fully staffed pharmacy in some distant, smaller communities were prohibitive.
Thrifty White’s answer: Operate a smaller store with a prescription kiosk, staffed by a technician and monitored by a company pharmacist at a full-service pharmacy dozens of miles away. “Our goal is to provide pharmacy services to these under-served areas and keep the business local” said Gary Boehler, EVP pharmacy operations for Thrifty White.
More recently, another Minnesota pharmacy operator, Sterling Drug, turned to pharmacy automation specialist ScriptPro to install its Telepharmacy unit in the town of Adrian, Minn., after that town lost its one drug store. The unit, staffed by a pharmacy technician, serves the prescription needs of the town’s roughly 1,200 residents from a Sterling Drug location in a larger, nearby town, Worthington, Minn.
“Mail order should not be the answer to these communities,” said Tim Gallager, VP pharmacy operations for Sterling’s parent company, Astrup Drug. “You can expand pharmacy services for less than the cost of opening a new pharmacy and support remote pharmacies without adding staff or recruiting pharmacists.”
Major chains also are weighing in. Rite Aid unveiled a new online chat capability in early August that gives customers enrolled in its wellness+ rewards program direct, 24-hour access to a Rite Aid pharmacist. Wellness+ members can access the feature, called “Ask a Pharmacist—Chat Live Now,” via a link on their online personal health page.
Walgreens also rolled out a new, real-time link between patients and pharmacists early last month called Walgreens Pharmacy Chat. The service puts customers in touch with a pharmacy staff member via an online link, 24/7.
Sorry, FTC: ‘Pay-for-delay’ isn’t going away
WHAT IT MEANS AND WHY IT’S IMPORTANT This week’s decision by the U.S. Second Circuit Court of Appeals could make political efforts to ban generic-branded patent settlements a lot more difficult.
(THE NEWS: Appeals court upholds decision to OK ‘pay-for-delay’ deals. For the full story, click here)
The Federal Trade Commission in particular, not to mention some members of Congress like Sen. Herb Kohl, D-Wis., has fought hard against so-called “pay-for-delay” settlements between branded and generic drug companies, contending that they delay patients’ access to generic drugs and cost consumers billions of dollars every year.
The concerns of opponents are understandable. Because generic and branded drug makers are supposed to be competitors, what seem on the surface like sweetheart deals must look positively Faustian to many people. But the judges in the appeals court affirmed that whatever their appearance, patent settlements don’t violate antitrust laws.
And the facts seem to support that decision. According to a report released in January by RBC Capital Markets, generic drug companies prevailed in 76% of cases that included settlements, but only in 48% of cases that went to trial. Meanwhile, according to a report released the same month by securities and investment banking firm Jefferies & Co., on average, patent settlements result in generic launch three years before patent expiration. Legally, a generic drug company must launch its version of a drug before or at the time of patent expiration.
While patent settlements often involve some type of monetary transaction, in many cases, the “pay” is in the form of a promise by the branded drug company not to launch an authorized generic, which is the branded drug sold under its generic name at a lower price. Under the Hatch-Waxman Act, the first generic drug maker to launch a knockoff of a branded drug is entitled to six months in which to compete directly with the branded version, but the authorized generic allows the branded drug maker to undercut the generic drug maker by marketing a supposedly “generic” version of its own.
Authorized generics have seen a bit of a pickup as well, and more activity on that front can be expected. On Tuesday, Greenstone, the generics arm of Pfizer, announced that it would create a new business called the Authorized Generics Alliance in order to market authorized generics under the Greenstone label.
Medicaid plans to end onerous AMP rules
WHAT IT MEANS AND WHY IT’S IMPORTANT It’s about time.
(THE NEWS: NACDS, NCPA in joint statement praise CMS’ move to withdraw provisions of AMP rule currently blocked by injunction. For the full story, click here)
The White House, or more specifically the Centers for Medicare and Medicaid Services’ division of Health and Human Services, announced in recent days that it plans at last to scrap its controversial and burdensome pricing policies for generic drugs bought by retail pharmacies to dispense to Medicaid patients. If CMS’ newly proposed rule goes through, it will mean the end of the current, much-disputed provisions that define the average manufacturer price of Medicaid me-too medicines.
The proposed rule, to quote the National Association of Chain Drug Stores, calls for “the withdrawal of existing provisions that define AMP, that determine the calculation of federal upper limits [FULs], and that define ‘multiple source drug.’”
As currently defined, Medicaid’s payment model for reimbursing pharmacists to dispense generics is based on a flawed formula for determining what retail pharmacies pay for those medicines, as determined by a set of controversial market metrics.
The current AMP policy almost is a guarantee that retail pharmacies would lose money on nearly every Medicaid generic prescription they dispense. It’s only a temporary court injunction that has thus far kept that new formula from being imposed.
Thus, CMS’ turnabout marks a real victory for the chain and independent pharmacy lobby, which has bitterly contested the AMP reimbursement formula since it was made policy by the Bush administration more than three years ago. But the plan to withdraw the current AMP model doesn’t end the long battle by pharmacy for a fair payment policy for dispensing generic drugs to Medicaid beneficiaries.
What the pharmacy industry –– and the U.S. healthcare system itself, for that matter –– need is a permanent solution to the Medicaid reimbursement mess. And that solution can only be achieved by congressional action and enactment of a new law governing Medicaid.
The 2010 health-reform law goes part way toward that solution, by holding the line on pharmacy cuts and setting the FULs on Medicaid prescription payments at no less than 175% of cost. It also includes what NACDS president and CEO Steve Anderson calls “a much-improved definition and calculation method for AMP” that will “better approximate pharmacies’ costs for purchasing generic drugs.”
Anderson said the injunction lawsuit filed in 2007 by NACDS and its independent pharmacy counterpart, the National Community Pharmacists Association, has saved pharmacy more than $5.3 billion in cuts since a federal court blocked the imposition of the new AMP formula in January 2008. It also may have prevented the closing of more than 11,000 community pharmacies that otherwise would have been forced to dispense Medicaid scripts at a loss or stop serving lower-income patients.
“When we filed the lawsuit in 2007, we knew that patient care was at stake,” Anderson asserted.
The bottom line is that the White House and Congress need to establish a federal payment system that rewards –– rather than penalizes –– pharmacies for dispensing lower-cost generics that provide the same safety and efficacy profiles as higher-cost pioneer medicines. Such a permanent fix would be a win both for the pharmacy industry and the American taxpayer, by saving tens or even hundreds of billions of dollars over the long term in federal health costs.