Health Care Reform and the New MTM Provisions: What

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
But I’m not your only speaker….
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)
• Principles of MTM
• Resources for starting your own MTM
So What is in this Health Care
Reform Bill Anyway???
Medicaid Generic Drug Pharmacy
(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 statebased 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
• 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
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
• 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
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
• 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 medicationrelated 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
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
Who Can Benefit From Medication
Therapy Management?
• Anyone who uses prescription medications, nonprescription 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
Medication Therapy Reviews
Pharmacotherapy Consults
Disease management coach/support
Pharmacogenomics Applications
Anticoagulation Management
Medication Safety Surveillance
Health, wellness, public health
Other Clinical Services
Medication Therapy Reviews
• The medication therapy review is a
systematic process of collecting patientspecific 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
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 ( 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.
• 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
• 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
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!”
Any Questions?
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