The Need for Formulary Standards
To Enhance Adoption and Utilization
of Electronic Prescribing
National Committee on Vital Health Statistics
Subcommittee on Standards and Security
July 29, 2004
MediMedia Information Technologies
a division of MediMedia USA, Inc.
MediMedia is pleased to provide this written testimony on a standard for formulary embedded in electronic prescribing applications to the National Committee on Vital and Health Statistics Subcommittee on Standards and Security. We believe we are in a unique position to provide insight and guidance, as the organization responsible for the InfoScan Formulary Database™, the oldest and most comprehensive aggregation of formulary information in the marketplace.
Our testimony will be organized around a list of questions subcommittee member Jeffrey Blair provided to us on June 21. However, before responding directly to those questions, we are providing some information to put our testimony in context.
MediMedia Information Technologies is a division of MediMedia USA, a $250 million publishing company. One of the world’s leading providers of healthcare communication, educational materials and services, MediMedia is an independent international company with a reputation for the quality and innovation of its products, and the strength of its truly global representation.
Our mission is to connect healthcare providers, medical professionals, consumers and pharma-ceutical companies by delivering timely, targeted healthcare information through the most efficient and appropriate channels. To do this, great emphasis is always placed upon data preparation and research, while keeping pace with new advances in healthcare, as well as the development of new information technologies. This unique blend of content and technical expertise combined with our worldwide presence has made MediMedia the first truly global healthcare communications company for the 21st century.
MediMedia offers some of the most renowned healthcare information products in the world. Our attention to medical accuracy, as well as our care in delivering key sources of information to the right audience, has earned the trust and respect of healthcare providers and their patients around the globe. The spectrum of works published by MediMedia is very broad ranging from drug directories and information systems, to sponsored journals, consumer health media and patient education publications.
To continuously improve the dissemination of information to our target audiences, our various publications and products are available in print, CD-ROM and online formats. Our core brands meet the medical information needs of both professionals and consumers in the following areas:
The MediMedia family of products provides a unique service to the healthcare community–improving the quality of health and the vitality of lives worldwide.
InfoScan Formulary Database™
In 1994, MediMedia started collecting, consolidating and interpreting healthcare and pharma-ceutical information from health plans, HMOs, PBMs and employer groups in the United States and publishing the information for use in the healthcare market.
One of our products – plan, state and regional formulary booklets – is still in wide publication and used by many healthcare professionals as a point of reference. In building a database to create and maintain this set of rich, clinical information, we saw a need in the marketplace to supply it electronically for computerized clinical applications and via the Web. Today we call this the InfoScan Formulary Database™.
In 1997, Allscripts came to us at the same time we were realizing the value of our information as a formulary database embedded in an electronic prescribing application offering to assist in the development of a functional product. An electronic prescribing software and service company, Allscripts observed that one payor or PBM’s formulary just wasn’t meaningful to a physician. To bring measurable value to its customer base, they learned their application should contain formulary information to cover approximately 70% of the prescribers patients. At the time, we were the only organization in the country that could provide the kind of breadth and depth required to meet this need. While some of the larger PBMs and health plans have banded together through RxHub and CAQH, respectively, our breadth and depth remains unmatched.
Our extensive coverage stems from our ability to collect and validate formulary information from 3,400 health plans, PBMs, PPOs and self-insured employers. These sources include one of RxHub’s founders, health plans affiliated with CAQH and many more! You see, our customers also include smaller health plans and PBMs who have chosen not to associate with those organizations.
These institutions supply this information to us in a variety of methods and formats – flat files, Excel, MS Word, email, phone calls and faxes. In the absence of a standard for collecting this data, we have become experts at doing so and aggregating it into one standardized data set. We consider this one of our competitive advantages.
Updates are provided by the plan based on established schedules on a client-by-client basis, often in conjunction with their respective Pharmacy and Therapeutics (P&T) committee. The data are quality checked daily to ensure currency and accuracy.
We receive a remarkably rich set of data from plans for inclusion in the formulary booklets, databases and Web sites and are, in some cases, the primary source for formulary information to a plan’s providers. In addition to drug status and tiers, we have step therapy rules, relative price ranking for on-formulary drugs, policies for generic preferences, non-listed and non-formulary drugs, rules or criteria for prior authorization, health plan policies for classes of members, therapeutic guidelines and advisory and restrictive notes. In fact, the data collected contains more information than typically provided to electronic prescribing software vendors. In an effort to be proactive, we are poised to provide the additional data to our business partners when the need arises and the systems are capable of accepting the data.
Today we provide this information in batch mode weekly and monthly via CDRom and FTP. Our customers select the schedule and method best meeting their individual needs. As one can imagine, with 3400 plans in the database, it is constantly in a state of change requiring updates to our business partners on a fairly frequent and consistent schedule. We consider this to be one of the greatest values of our service. The data are only valuable and reliable if it is kept current.
Generally we provide the data in one standard proprietary format for ease of comprehension and implementation. However, in some cases special requirements by customers have necessitated the need to customize the data.
Our customers are a “who’s who” of healthcare technology application providers –WebMD’s Medical Manager, GE Medical (MedicaLogic), McKesson, Cerner, Allscripts, NextGen, Misys and many others. Notably, these companies are mature health care information technology providers, and no one reaches more physicians than we do.
Many of these companies are also physician office practice management system (POMIS) suppliers. If they do not have these capabilities, they have partnered with a company offering them. As you know, POMIS technologies are used for billing and scheduling, among other things. As such, they are considered the lifeblood of a medical practice, serving as the primary source of demographic, insurance and other non-clinical information about a patient. Consequently, the physician office staff works very hard to make sure the data are current and accurate.
Testimony by the electronic prescribing software and service companies stated they often obtain a one-time download from the POMIS system and the office staff is required to add all new patients to the ePrescribing system. Other times – and ideally – they have a real-time interface with the POMIS system so that the office only has to enter patient information once. As Dr. Tom Doerr of Wellinx testified, this requires a great deal of time and effort, and can be expensive.
For what it’s worth, many long-time health care professionals believe physician office staff will be reticent to input demographic information into more than one system – ie the POMIS andePrescribing system – and the only viable long-term solutions will be those that have real-time interfaces with these critical practice management systems. Consequently, integration with these systems will be critical to any sustained electronic prescribing program.
One of the key pieces of data contained in the POMIS is the health insurance benefit information, which is collected from the patient, generally off the patient’s health plan card, and input into the POMIS system for billing purposes. Since there is no standard for health plan cards, the obtained information is often inconsistent and difficult to link to a formulary. As an example, a patient’s health benefits manager may not be the same as the pharmacy benefits manager; therefore, the names may not be consistent within the formulary database. To be candid, this is the biggest challenge for both ourselves and our clinical systems customers.
To improve these links, we create English-language headers linking to the information on the patient’s card. It is difficult to put a finger on our success rate but we continue to strive to improve the process by providing our expertise in assisting in mapping the name the patient has on his or her card to the name provided to us directly from the plan. The area most difficult to map to are the plans providing pharmacy benefits but from an entirely different city or state from the medical benefit processor.
1. What aspects of drug formularies should or should be national standards?
A. The format of the formulary?
As Jim Bradley, then of RxHub, testified in May, there are two types that should be accom-modated – interactive and batch. While we have capabilities for both, most of our data transmissions are in batch mode.
As Robin Thomashauer from CAQH testified in May, there are opportunities with both the data sets incoming form the plans and PBMs (“submission formats”) and those outgoing from the data aggregator to the electronic prescribing, electronic health record (EHR) and computerized physisican order entry (CPOE) software and service companies. We see both submission formats and outgoing data sets as candidates for national standards; however, we recommend the priority be the outgoing data set to minimize custom coding requirements for the software/service companies.
Creating and maintaining a standard such as this would require input from all stakeholders, including and especially the health plans, PBMs, software/service companies and aggregators such as MediMedia, CAQH and RxHub. The standard development organization (SDO) that exists today with the closest approximation of those stakeholders would be NCPDP; therefore, we recommend NCPDP as the organization to spearhead this important task. NCPDP has independent governance, an existing voting process and bylaws supportive of the process necessary to obtain and maintain consensus.
On the subject of creating a mandatory submission formats, we would caution that, if not constructed intelligently, they could limit plan creativity, putting a ceiling on the types and quality of information. We believe submission formats should allow maximum flexibility.
We also caution against creating a standard data set that includes information on which independent companies currently do not have access. For example, group level information is generally maintained by the PBM and cannot be acquired directly from the plan.
B. The data in the formulary
As we testified earlier, the contents of a formulary vary by plan or PBM, and would benefit from standardization. For example, the definitions of basic terms such as “preferred status” vary from plan to plan.
Another example is the diversity of tiered formularies. Sometimes in a two-tier formulary, we find brands in tier one. Other times we find expensive generics in tier two. For many reasons, it is important for the plans to have the ability to customize this for their respective situation or client base.
To be candid, it will be tricky for the SDO to standardize this. We would argue that creativity should not be comprised for standardization. Maximum flexibility will allow plans to meet the business objectives of keeping costs in check while improving outcomes.
C. The coding of the data
In May, CAQH testified that they had created “crosswalks” to the most frequently used compendia – First Databank and MediSpan – for the incoming data. In addition, we have created tables linking our formulary data to Multum, another clinical database provider. We are flexible and stand ready to interface with Gold Standard MultiMedia and MicroMedex in the future. This is available in both the submission and outgoing data sets.
In May, several companies testified they believed the new drug code set, RxNorm, would help software companies. While we have created tables linking our formularies to NDC numbers, linking to RxNorm would not be an issue for us.
D. The messages that communicate to (and from) the formulary
Like the data, the messages that communicate to (and from) the formulary are generally proprietary to the plan or PBM. We will continue to support the messages provided to us, whether they are standardized or not.
As we explained in the introduction, we obtain a rich set of these messages because our data is also used for booklets and Web sites – media that have traditionally provided additional information. Our clinical software clients tend to have the ability to display any messages requested of the health plan, regardless of content. They tend to create a common method for presenting status, and the ability to present drug-specific messages.
As we described earlier, we see the biggest marketplace challenge as linking the patient’s demographic information obtained from the health plan card to the formulary. We believe this process would be substantially improved if there were a unique identifier for health plans, as both McKesson and Allscripts testified in May. This identifier should not be at the plan level. It needs to be built so that it will accommodate lines of business underneath the plan (ie, Aetna 2 Tier, Aetna 3 Tier, Aetna HMO Three Tier, Cigna PPO Two Tier, Humana 3 Tier or 4 Tier, etc).
Another significant challenge is linking the formulary to the health plan card. Often an employer or union will self-insure for the prescription benefit, contracting directly with the PBM. In this case, the patient will have separate health plan and PBM cards. The office staff will collect only the information required to submit the medical claim – the information on the health plan card – which may not be the information necessary to link the patient to the formulary. (Of the 17 million United Healthcare Group patients, 5 million have separate PBM coverage.)
RxHub has worked around this by creating a master patient index; however, not every PBM or plan feels it is in its best interest to join RxHub, and it would be anti-competitive to force affiliations with an entity that is controlled by the three largest PBMs. If there were a standard way of displaying health plan cards, including information that would allow an aggregator to link to a specific formulary, formulary compliance would be improved dramatically. While there would clearly be challenges, stakeholders working through a SDO could work out the details on how this would be accomplished.
3. Is MediMedia offering any portion of its formulary database as a standard that would be available to users at no charge?
We would be happy to provide our format and coding of data as a starting point for an industry standard. We would also be happy to participate with plans, PBMs, aggregators and other stakeholders in discussions to create a standard for data, messages and health plan identifiers.
4. Has the standard(s) been accredited as a consensus-based standard by the American National Standards Institute (ANSI)?
This is not applicable.
5. If not, does MediMedia plan to apply for ANSI accreditation?
We do not plan to apply to become a consensus-based accredited organization; however, we are more than happy to help develop a standard within the framework of an SDO who is.
6. Does MediMedia provide the formulary as a batch download?
7. Does MediMedia also provide Web or Internet based services that provide real-time transactional information?
We provide both formulary information through both batch and transactional methodologies.
8. What other suggestions does MediMedia have for NCVHS as it evaluates, selects and recommends standards for ePrescribing?
While it is important to hear testimony from stakeholders such as health plans, software companies, content providers and switches, it is also critical to keep in mind two stakeholders who are not as prominently represented on the list of testifiers – patients and physicians. As an independent entity, we consider ourselves to be patient- and physician-friendly. We think it would be a mistake to shape standards so that they benefit entities that are owned by the plans or PBMs.