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ACO Final Rule Acknowledges Medication Concerns

Pharmacy & Therapeutics Journal...December 2011

     The final rule published by the Centers for Medicare and Medicaid Services (CMS) at the end of October mostly simplifies and improves the financial aspects of the Accountable Care Organization (ACO) program in an effort to convince physician groups and hospitals to participate. It doesn't change the rules on who can share in any savings to Medicare produced by an ACO, a new form of integrated health care organizations, formed by physician groups and in some cases hospitals with staff physicians, aimed at providing comprehensive care to Medicare patients, and thus lowering the costs of that care, producing savings for Medicare. The Affordable Care Act (ACA) specifically states that only physicians and hospitals can share in the savings. The proposed rule followed that edict; pharmacists, chiropractors, nurses...all were deemed "out of the money." The final rule sticks to that decision.
     That said, the medication management provided by pharmacists in large physician practices and hospitals will be critical to the success of any ACO. Dave Rhew, MD, CMO of Zynx Health, a provider of evidence-based and experience-based clinical decision support (CDS) solutions to hospitals, says physicians basically prescribe medications they have traditionally prescribed, and can sometimes be behind the curve, because of time constraints, on current changes in drug profiles. It will be up to a pharmacist to update physicians and hospital formularies, for example, when a drug like Xigres (Drotrecogin Alpha), for severe sepsis, is voluntarily recalled by its manufacturer, here Eli Lilly, because of FDA concerns about the drug's effectiveness, in this case a concern that the drug does not reduce mortality.
     With regard to pharmacist interventions in ACOs, they only come into play where drugs are supplied to a Medicare fee-for-service patient by a physician in the physician's office (Part B) or in a hospital (Part A). An ACO participant's Part D drug costs will not be part of the "shared savings" calculations. This may turn out to be problematic in a number of instances, for example, in certain clinical areas such as cancer care and cardiac ablation for atrial fibrillation where ACOs may have an incentive to move patients from appropriate treatments or procedures reimbursed through Parts A or B to Part D therapies. The CMS acknowledged these are "important concerns" but the program's quality measurement and program monitoring activities "will help us to prevent and detect any avoidance of appropriately treating at-risk beneficiaries. Furthermore to the extent that these lower cost therapies are not the most appropriate and lead to subsequent visits or hospitalizations under Parts A and B, then any costs associated with not choosing the most appropriate treatment for the patient would be reflected in the ACO's per capita expenditures."
     It is impossible to know now whether this concern--medication cost shifting from A or B to D--will bear factual fruit going forward. But the CMS will apparently be looking over the shoulders of ACOs on this issue. "The financial incentives could cause physicians that are part of ACOs to increase the use of Part D medications to decrease the use of Part B medications or appropriate medical procedures," says Marissa Schlaifer, the Academy of Managed Care Pharmacy's (AMCP) Director of Pharmacy Affairs. "The Academy shares this concern." 
      Of course, the program integrity watchdogs at the CMS and other federal health agencies are getting fewer and fewer, federal budget cuts being the order of the day, and even in the halcyon days of federal spending with bigger staffs Health and Human Services were rather passive policemen. The office of pharmacy affairs, which administers the 340B drug program, is a good example of a department where, according to a recent Government Accounting Office report, the department detectives have had their feet up on their desks.

     We mention the 340B program here because it, too, comes into play with regard to concerns about medication cost shifting in ACOs. The 340B program allows safety net hospitals with high Medicaid populations to buy discount drugs, and it restricts whom those hospitals can give those drugs to. Recipients have to be patients of the hospital, seen by a hospital physician, and the drugs must be purchased at an out-patient (not in-patient) pharmacy. The drug manufacturers hate the 340B program, which requires them to sell drugs more cheaply than they would otherwise have to. Their concern is that safety net hospitals who join an ACO will expand their purchases of 340B drugs and provide those drugs to perhaps a medical group with whom it has partnered in an ACO. That allows the physician to substitute a cheaper drug (at 340B price) for the more expensive one he would have used, thus reducing the ACOs costs, since drug costs within Part B are calculated in the ACO equation.

        Hospital pharmacists are knee deep in the 340B program. So while they and their brethren stationed in physician offices will not be able to share in ACO savings, it looks like they will have their hands full preventing ACO headaches.