Scourge Of Prior Authorization Finally Acknowledged?

A copy of Minnesota Medicine, the journal of the Minnesota Medical Association (MMA) was delivered to my office this morning.  I stopped paying dues to the MMA about 20 years ago.  My rationale was that I was already paying significant dues to two professional organizations that were doing nothing to protect me from the repeated abuses of the managed care industry - why pay a third to do an equally poor job?  I was probably more steamed at the MMA at the time because I realized that managed care in Minnesota was more than just an annoying business practice, it was institutionalized in both the statutes and administrative practices of the state government.   I sent the President of the MMA a letter to that effect.  I don't have his response but it did not persuade me to send them another check.  I can only guess that this is a marketing idea to persuade the disaffected that the MMA is now a vital organization that appreciates medical practice in the state in many cases has come perilously close to being a living hell.  That living hell is courtesy of managed care and the various heads of that hydra.

Despite those reservations, on the front page just below the journal title was this headline:  The Prior Authorization Burden and just below that the subtitle: The process is frustrating, time-consuming and costly.  No kidding.  Any casual reader of this blog may recognize that this is probably one of the only sites where you can count on rigorous criticism and aggressive opposition to all managed care techniques.  At the top of that list is prior authorization.  I have gone as far as coming up with a "no-Rx" logo that I use to symbolize the problem.  That symbol is at the top of this post. It means that a managed care company (MCO) or pharmaceutical benefit manager (PBM) can deny prescriptions and therefore medication to the patient.  That denial is also a denial of the prescription of the physician and everything that involves.  State and federal governments have granted these organizations this power based on some loose idea that it would save patients and the governments money.  These governments are still enamored with that idea despite the overwhelming evidence that money is not really saved, it is merely redirected to the bottom line of MCOs and PBMs.  The only people who pay the price are patients and physicians.

So my first and primary question was "Does the medical society finally get it?"  They certainly missed the boat on utilization review and as a result managed care organizations in Minnesota generally make the discharge decisions on patients.  Will they also continue to make decisions about what medications can be prescribed based on their profit margins rather than what a physician in a treatment relationship with the patient decides?  The initial example seemed hopeful.  It was the story about a primary care physician trying to prescribe a rescue inhaler for his asthmatic patient.  He had taken a specific brand of generic albuterol for years.  The prescription was rejected.  He wrote subsequent decisions for identical medications in the same category Proventil and that was rejected.  He sent in a script for ProAir and that was rejected.  He was told to choose another inhaler but not given a name to choose.  He picked Xopenex or levalbuterol rather than albuterol and that was accepted.  What is the rationale for a PBM having a doctor guess about which inhaler will be approved for days while a patient with severe asthma goes through the weekend without a rescue inhaler? In a word money, the only rationale for picking a newer and (usually) more expensive inhaler is that the PBM has some kind of financial deal with that manufacturer.

 The article does go on to explore that theme and references a study of six Minnesota Health Plans.  The researcher Barbara Daiker, RN, PhD found that there were 1,036 drugs that required prior authorization but only 6 were on the prior authorization list of all 6 health plans.  Only 26 more were on 5 of the 6 lists.  This level of variability suggests that the decisions are not based on scientific evidence or quality concerns but financial models.  It would have been very useful to know if any of these lists included generic drugs. Without a scientific or quality basis for these lists, the obvious model is a purely financial one.  That is also consistent with the tactics used by these companies that I have documented in this blog such as refusing to cover generic antidepressants that can be purchased for as little as $4.00 per month.

One of the facts about prior authorization is that  like most managed care tactics, the burden has fallen disproportionately on  psychiatric practice and patients with mental illness.  One of the first articles demonstrating the adverse effects of prior authorization was published in the New England Journal of Medicine in 1994 (2) showing that when prescription limits were imposed on patients with severe chronic mental illness it resulted in increased health care costs that exceeded the savings in medication by a factor of 17.  In a more recent study, Driscoll and Fleeter (3), estimated the adverse effects (hospitalization, lost wages, homelessness, incarceration, higher medical costs) of prior authorization applied to the population of Ohio residents with schizophrenia and bipolar disorder.  They used conservative estimates of the population at risk and treatment discontinuity as a result of prior authorization programs.  They determined associated indirect costs with these treatment discontinuities and summarized his results in the following table.

The Driscoll and Fleeter study replicates several other studies that illustrate the problems with the "cost savings" of prior authorization.  Those savings to an MCO or PBM are shifted to the patient and the taxpayer.  These studies are consistent with the recent concern about the mass incarceration of the mentally ill.  Nobody is paying attention to the fact that when this happens the cost of care is now paid by the correctional system and not the person's insurance.  If a person with a substance use problem is incarcerated any medication they take to maintain abstinence is generally discontinued resulting in more savings to the MCO.  In addition to the financial analysis, the psychiatric care of these persons is often severely disrupted because correctional systems are now imposing their own form of a limited formulary so that the patient may get a medication, but not one that has been carefully assessed to work.

These studies all demonstrate that "savings" from prior authorization is savings to a health care company and it does not benefit the patient involved.  The costs to the providers in the case of the above table were not even used but per my previous reference are considerable.  I would also add that since this study came out most of the original second generation antipsychotics are now generic drugs and that reduces the Annual Cost Savings considerably.  The estimates for Annual Additional Cost are much higher and don't include the paperwork costs for physicians.  In other words the net added cost of prior authorization for psychiatry is considerable higher in 2014 than it was in 2008.

With all of these considerations it is good to see the state medical society finally paying attention.  That doesn't mean anything will be done and the evidence for that is contained in this quote from Janet Silversmith, Policy Director of the MMA: "We are not trying to eliminate drug prior authorization.  We are just trying to add some sanity to the process.  As it's practiced now we believe drug prior authorization is an onerous, inefficient process that sometimes harms patients."

Why wouldn't any medical society want to kill that kind of process?


George Dawson, MD, DFAPA

Refs:

1:  Howard Bell.  The prior authorization burden.  Minnesota Medicine. November/December 2014:  18-25.  PDF

2:  Soumerai SB, McLaughlin TJ, Ross-Degnan D, Casteris CS, Bollini P. Effects of a limit on Medicaid drug-reimbursement benefits on the use of psychotropic agents and acute mental health services by patients with schizophrenia. N Engl J Med. 1994 Sep 8;331(10):650-5. PubMed PMID: 8052275.

3:  Howard Fleeter, PhD.  Estimate of the Net Cost of A Prior Authorization Requirement for Certain Mental Health Medications.  Prepared by Driscoll and Fleeter for National Alliance on Mental Illness Ohio.  August 2008. (Table used with permission).



Supplementary 1:  The "No - Rx" logo simultaneously symbolizes no prescription for the patient, no acceptance of a prescription from a trained and licensed physician, cost savings for the insurance entity that contracts with the patient to cover their prescription medications, and increased costs for all of the providers, employers, governments and correctional systems that need to address discontinuities in care.

YOUR PATIENT IS UNABLE TO START YOUR PRESCRIPTION

Just when I thought that prior authorization could not get any worse, I see a fax with that headline.  I guess the business geniuses who thought it was a good idea to send me that fax never stopped to consider what was wrong with that idea.  What could that possibly be?  Let me see, I have made several comprehensive assessments of a medical and psychiatric disorder that is extremely complicated, selected a medication that was seen as appropriate by medical consultants treating another major medical problem,  did all of the medical screening for this particular medication including a meticulous search for drug interactions across 3 different data bases, thoroughly assessed the patient for side effects and complications from this particular medication and stabilized the patient on that medication.  I also had a detailed informed consent discussion with the patient for this medication and not a general class of medications.

Remind me why my patient is unable to start the medication - - - Oh that's right:

YOUR PATIENT IS UNABLE TO START YOUR PRESCRIPTION BECAUSE WE WANT YOU TO PRESCRIBE THE CHEAPEST DRUG OR THE DRUG THAT WILL GET US THE BIGGEST KICKBACK FROM THE PHARMACY AND THAT IS WHY WE ARE IGNORING THE FACT THAT YOU HAVE PRESCRIBED A GENERIC DRUG AND WE THINK THAT ALL DRUGS IN ANY GENERAL CLASS OF MEDICATIONS CAN BE SUBSTITUTED FOR ONE ANOTHER AND OF COURSE WE DON'T REALLY CARE ABOUT THE TIME AND EFFORT EXPENDED IN THE EVALUATION AND TREATMENT OF THIS PATIENT AND THE FACT THAT IT WAS SPECIFIC TO THE DRUG YOU PRESCRIBED AND WE DON'T REALLY CARE ABOUT WHAT HAPPENS TO THIS PATIENT BECAUSE WE ARE IN THE BUSINESS OF MAKING MONEY AND WE HAVE NO PERSONAL RESPONSIBILITY TO THIS PERSON AND YES YOU WORK FOR US AND YOU WORK FOR FREE IN ORDER FOR US TO BE ABLE TO DO THIS.

That simple 8 word phrase says everything about how medical care in this country has been corrupted for the enrichment of companies that make money by denying or interfering with care that has been carefully prescribed for patients by the doctors who know them the best.

A serious rewrite is needed for their fax cover sheet.

George Dawson, MD, DFAPA

Why the Practice of Pharmacy Management is Another Business Hoax

I had the pleasure of dealing with another Pharmacy Benefits Manager (PBM) recently.

It all starts with a fax from a pharmacy anywhere in the United States.  The usual pharmacy fax that looks like a telegram.  I know that because I can recall seeing railroad telegraphers in action in the 1950s and know what telegrams look like.  Pharmacy faxes have that appearance.  A partial Rx was listed on the front basically the drug and number of tablets with no instructions.  The "date of request" was actually 5 days earlier than the date I got the fax.  I pulled up the record and called the 800 number and listen to the usual disclaimers about why I might be recorded.  I don't hear the real reason.

The conversation went something like this:

PBM1:  "Can I verify the patient's identification number?"
Me:  I gave the 10 digit number
PBM1:  "Was that _ _ _ _ _ _ _ _ _ _?"
Me:  "Yes"
PBM1:  "Can I verify the patient's name and date of birth?"
Me:  I recite that information.
PBM1:  "Can I verify your name?"
Me:  I say my name.
PBM1:  "Can I verify your title?"
Me:  "Staff psychiatrist."
PBM1:  "Can I verify your secure fax number?"
Me:  I look it up and say it.
PBM1:  "Can I verify your office number?"
Me:  I state my phone number.
PBM1:  "Can I verify the medication?"
Me:  I state the name of the generic medication.
PBM1:  "Well I am going to have to transfer you to a pharmaceutical benefits manager.  I also need to tell you that person will need to do the same verifications that I just did.  Is there anything else I can help you with this morning?"
Me: (suppressing the remark that they really have not done anything for me so far except waste my time) "No I guess not."

At that point I am connected to a different line and listen to the same disclaimers about being recorded.  I am eventually connected to the second staff person who goes through the first nine steps of the verification process again and then gets into a whole new area:

PBM2:  "Can this person not take the full dose of the medication?"
Me:  "What do you mean?"
PBM2:  "The medication in this case seems like a lower dose.  Can they not tolerate the full dose?"
Me:  "Let me say that I am reading this out of the record and I assume it is the same record you have, because I am looking at an exact copy of the prescription.  I am covering for another physician and his prescription clearly states that the patient is to get two weeks of the medication and take three tablets a day."
PBM2:  "OK I have to fax this information to the pharmacist.  The turn around time is 48 to 72 hours unless I mark it as an expedited review.  Then you can get it back in 24 hours.  Do you want me to mark it as expedited?"
Me:  "I don't know what difference it will make.  Today is Friday and there is nobody in this clinic on the weekend.  The prescription is already delayed by 5 days.  I don't know what difference an expedited review is going to make."
PBM2:  "All right I will send it to the pharmacist.  Is there anything else I can help you with today?"

More wasted time.  The entire length of time it took to listen to the recordings, recite data that the PBM already had to two different people and not get an answer on the "Prior Authorization" was 20 minutes.  Not only that but this company continues to use me as their surrogate in that they are not contacting the pharmacy but sending me another fax to deal with in the next 24-72 hours.

This is a simple vignette that illustrates the malignant effects of business and Wall Street on the practice of medicine in the United States today.  I don't want to leave out the effect of every state and federal politician since Bill and Hillary Clinton suggested that giving businesses unprecedented leverage over physicians would be a good idea.  If you read the vignette you have seen how a business can waste at least 20 minutes of a physician's time,  prevent a patient from getting a timely prescription refill, and in the end leave the physician responsible for what is a business decision made to make more money for a company that has no direct responsibility to the patient.  And all of these manipulations are for a generic low cost medication.  A reader might not realize that physicians often see 10-20 people per day and in many practices have only 15-20 minutes to see each patient.  That means that they could easily spend as much time getting a single prescription approved as they did assessing the patient.  The additional business genius here (how many MBAs did it take to think this up?) is that by sending the final fax back to the physician rather than the pharmacist, it leaves the physician on the hook for being blamed for the prescription not being refilled.  How many times have you heard from a pharmacist: "Your doctor's office did not call us back yet?".  In how many cases was it due to delay that I just described?  To recap, it takes the PBM anywhere from 5-8 days to handle a decision about a medication that I turned out in 20 minutes.  But wait a minute, it takes the PBM 5 - 8 days plus 20 minutes because this decision was already made a week ago by a physician.

Hoax is not a strong enough word.

George Dawson, MD, DFAPA


Supplementary 1:  I could not fit this in to the above post but I also thought about how medical businesses are caught up in customer satisfaction surveys to show how great they are.  In that case they are banking on the fact that they can use physician qualities or psychological tricks rather than real measures of medical quality to get "performance scores" that they can use for marketing purposes.  I would suggest that anyone who is handed a customer survey by a health plan clinic or hospital remember their pharmacy experience when they complete that form.  Let them know that you are very dissatisfied that your prescription was delayed or changed just so one of their contractors could make a few bucks.

Supplementary 2:  I have several posts on this blog about PBM and managed care delaying techniques.  I came across and excellent post by a financial blogger on how her interaction with the same insurer has changed over time.  I would really like to see more people come out with their experiences and go public.  Feel free to post it here, but don't name the actual company.  Post only your experience.  I know for a fact that PBMs monitor this blog, because I got called by one of their VPs within 12 hours of naming the company.  I will only be able to do that  when I am no longer employed.

Supplementary 3:  Just a reminder that this is not my first prior authorization post and it probably won't be the last:

Prior Authorization - A Legal Document?

25 minutes is 25 minutes - The Prior Authorization Rip Off Continues

Prior Authorizations - An Incredible Waste of Time

25 minutes is 25 minutes - The Prior Authorization Rip Off Continues

I can still recall when I was referred to my first web site for a prior authorization of a prescription medication.  My first thought was: "Great - I am going to have to open up an account somewhere so that I can work as an uncompensated employee of a PBM."  It wasn't quite that bad but it wasn't good either.  Online prior authorization request are often hyped as the solution to the ongoing physician harassment by PBMs.  They claim to be faster that the usual fax or telephone methods.  From the scenario I recently posted it is hard to believe that they could be any slower.

In this case I had to be the data entry person and enter data from a fax from the pharmacy and the demographic section of my EHR onto two computer screens.  After establishing that all of the correct releases were in place, that involves going between these screens and supplying data that physicians typically don't ever use and therefore do not care about.  In this case it was health insurance data - the group number and name of the policy.  Remind me why I went to medical school again.  Luckily I work with an excellent staff, but it meant getting up and finding the right person to get me this information.  I can imagine that there are a number of settings where it might not be listed.  In that case you cannot complete the form.  It just locks up there in cyberspace and does not allow you to complete and submit it.  The form is actually a request for prior authorization and you have to do it even if the patient has been taking the medication for some time.

In the previous post I pointed out that some members of my state psychiatric society had developed a form that included data on previous medications from the class in question that were either not tolerated or failed.  Of all of the people I have seen, there are very few people who can provide that level of detail over any 10-20 year span of medication trials for disorders than can affect memory and motivation.  I usually provide a checklist to prompt people as shown below.  In many cases there are surprisingly few responses until I show them the checklist.  Medication names are basically medical jargon at its best, and people outside of any field who are unfamiliar with the jargon are less likely to recall these terms.  Filling in the past medications for a prior authorization is problematic for that reason.  Filling it in is also problematic if the patient has been seen for years.  Somebody still needs to go in and search for the medications.  Most EHRs have poor search capability for classes of medications and even if there is one table somewhere it will not say whether the medication failed or was not tolerated.  Without that information the form cannot be completed.

With the wonders of the Internet and computers, prior authorization remains a waste of time.  The forms are not designed for physicians to complete and the human factors involved still require a lot of time.  No physician I know has 20 - 25 minutes to waste on form completion for every moderately priced prescription that they write.  No physician I know has that kind of time to waste irrespective of the cost of the drug.  The phenomenon has been studied to some degree (1) and the actual costs are very high.  One study showed that physicians spend at least 35 minutes a day on this activity and required 0.67 FTE non-clinical staff  per FTE physician.  The total annual cost of the physician and non-clinical staff time was $85,276.  That is nearly 4 times as much as Canadian physicians (2) and I am guessing that most of that is due to prior authorization.  That translates to an annual figure of $23 to $31 billion dollars annually (3) to medical practices in the US.  When I say that I have done a lot of free work for managed care companies and PBMs I am not kidding.

There has been some additional data available about prescription drugs used for psychiatric indications in a report from SAMHSA (4).

I think that it is apparent from the graph that the growth in medication spending is more likely to be due to patent protection of name brand medications than excessive prescribing of expensive drugs and the pricing structure of specific pharmaceutical companies.  For a graphic showing some of these patent expirations check out this link.  I can recall the clozapine prior authorization procedure in this state when it first became available in the 1990s.  Clozapine prescribing was limited to registered psychiatrists and for every prescription you had to call a PharmD in the Department of Human Services and recite the diagnosis and white blood cell parameters.  It did not take long to realize that the expense of the drug and the associated monitoring was not a determining factor in the prescription of this medication.  The argument has been made by some that clozapine was not used when it might have been useful because of the barriers to prescribing it.  Those barriers have been widely recognized by psychiatrists and the prior authorization was not a determining factor.  It was discontinued in about 2 years and most of the companies who currently handle it have an expedited enrollment in their registry that is faster than most medication prior authorizations.

If PBMs want to reject pharmacy claims they can do it easily on business grounds rather than involving physicians.  They can also just charge a high copay.  This is clearly a high cost problem to physicians, clinics and hospitals.  Eliminating it would result in more saving than the mythical electronic health record dividend.

George Dawson, MD, DFAPA

1: Sakowski JA, Kahn JG, Kronick RG, Newman JM, Luft HS. Peering into the black box: billing and insurance activities in a medical group. Health Aff (Millwood). 2009 Jul-Aug;28(4):w544-54. doi: 10.1377/hlthaff.28.4.w544. Epub 2009 May 14. PubMed PMID: 19443478.

2: Morra D, Nicholson S, Levinson W, Gans DN, Hammons T, Casalino LP. US physician practices versus Canadians: spending nearly four times as much money interacting with payers. Health Aff (Millwood). 2011 Aug;30(8):1443-50. doi: 10.1377/hlthaff.2010.0893. Epub 2011 Aug 3. PubMed PMID: 21813866.

3: Casalino LP, Nicholson S, Gans DN, Hammons T, Morra D, Karrison T, Levinson W. What does it cost physician practices to interact with health insurance plans? Health Aff (Millwood). 2009 Jul-Aug;28(4):w533-43. doi: 10.1377/hlthaff.28.4.w533. Epub 2009 May 14. PubMed PMID: 19443477.

4: Substance Abuse and Mental Health Services Administration. National Expenditures for Mental Health Services and Substance Abuse Treatment, 1986–2009. HHS Publication No. SMA-13-4740. Rockville, MD: Substance Abuse and Mental Health Services Administration, 2013.

Supplementary 1: I received a prior authorization fax today about two weeks after the original post.  It contained a number of checkboxes that were very crude approximations of the decision making process for prescribing the drug.  Since the strategy itself serves no useful purpose, I continue to conclude that this is a process designed to slow down and possible thwart the prescription process for an FDA approved drug, simply because of high cost.  Any delay involved makes it less likely that the patient will pick up the prescription and increases the likelihood that the fax will get lost in the process.