Merry Christmas From Your PBM

 

After some deliberation I went into my local Walgreens for an RSV immunization.  I have multiple unpredictable allergies and have had both anaphylaxis and significant local reactions to vaccinations in the past. Like 20% of the population, I have eczema and there is some research on flareups of this skin disease with vaccinations.  And like many people with eczema, I also have asthma and had a severe flare-up of asthma when I got a viral infection on a flight back from Alaska about 5 years ago. My primary care physician recommended it last week so I scheduled it.

As I was sitting there waiting for them to prepare the shot, I was able to observe patients coming and going to pick up their prescriptions. This is a busy Walgreens and there are people going past the drive-up window as fast as they are showing up in line.  Most people at there in the early afternoon are retirees.  There was an informal retirement poll of the old guys in line and it was unanimous – we were all quite happy to be retired. The people gathered were upbeat. I recalled being at a 24-hour pharmacy in 2002.  My late father-in-law was visiting and forgot all his cardiac medications.  I went over at midnight to pick them up and it was an ugly scene.  There were about 60 people there and the pharmacist was not filling the prescriptions fast enough. From where I was seated – I could see him working furiously.  The crowd was so agitated about this it seemed like they were ready to riot. If that wasn’t enough a rather cranky lady sitting next to me started to goad them and call them names.  Luckily, I got the medicine and got out of there as soon as possible.

 The atmosphere today was much better – but like most scenes in American health care it was far from perfect.  There were no simple transactions. In the transactions I witnessed, very few people walked away with the prescription medication ordered by their doctors. The most common problem as a lack of prior authorization. People were advised that their doctor had to get the prior authorization. Several were advised that they needed a new prior authorization. I remember all the messaging that people hear when they need a prescription refill.  Call your doctor’s office.  Don’t call your doctor’s office.  Call the pharmacy.  Don’t call the pharmacy.  Today 75% of that messaging was incorrect.  And it wasn’t like the medications were an option.  Antihypertensives, diabetes medications, prostatic hypertrophy medications – every medication name I heard had me hoping these impasses would be resolved as soon as possible for the patient’s sake. The related quality issue is that most of these medications were maintenance medications and yet they required reauthorization – in some cases just because of an insurance change.  I didn’t see anyone get hit with the Medicare Donut Hole. I have been twice in the past 3 months with a copay for apixaban ballooning up to $400 or roughly 7 times the usual amount just because of the way the rules are written to favor pharmaceutical companies and pharmacy benefit managers (PBMs). I am sure it would have happened if I had been there longer.

But 20 minutes was up and I did not have an anaphylactic reaction. Another immunization I can take.  I jumped in my car, turned the radio on, and thought about what I had just witnessed.  I am certainly no stranger to it. As a physician I have been harassed by PBMs.  They put me on hold for hours only to eventually connect me with a clerk with no medical training or credentials that would either approve or reject my recommended prescription.  PBMs are not some quality improvement project – they are patient and physician harassment to see who blinks first and loses the time and money.  They are multibillion dollar companies that add to the cost of medications rather than reducing the cost.

Overall prescription drug pricing in the United States is much higher than in comparable countries both on an overall basis and a brand name basis.  A study (1) that looked at 2018 data showed that all drug pricing ranged average 258% higher than comparable drugs purchased in Mexico, Canada, France, Germany, Italy, Japan and the UK.  Comparable brand name medications averaged 344% higher.  All of that translates to much larger copays for Americans and often an inability to purchase the medication. I saw that happening a lot today.

Advocacy from the physician side has been weak. After decades of no action on the prior authorization issue some professional organizations are now saying that it needs to be controlled. The problem with that position is that it is so ratchetted down on patients and physicians that any controls in the right direction will be trivial.  The only solution is to eliminate prior authorization completely. If pharmaceutical companies want to deny payment for prescription medications – they can do it directly without using the physician and pharmacist for cover. Beyond that the appeal can go through a state administrative authority independent of the pharmacy business.

I have written extensively in the past about the sheer amount of resources that are wasted on prior authorization and the associated pharmacy rationing strategies.  I have written about how pharmacists take a significant hit and their professionalism is adversely affected by poor PBM reimbursement and conflict of interest – especially when the PBM owns their own chain of pharmacies. Today as I was waiting for clearance after an immunization it was all about the human cost.

That never seems to get better, although the Obama and Biden administrations have provided some significant relief to Medicare recipients. Everyone involved would be happier if this system was just gone.

 

George Dawson, MD, DFAPA

Supplementary 1:  Additional inefficiencies - a couple of days after writing this post my wife got a text message that one of her prescriptions was ready and she could "pick it up after Sunday."  She asked me to pick it up on Monday because I was driving by the pharmacy.  I pulled up to the window and asked for the prescription and was told - "it is ready but you are one day early.  You can pick it up tomorrow." Not the first time that has happened.  The pick up rule seems to vary by PBM, insurance, and pharmacy but the automatic messaging obviously does not take it into account. Just another reason for going to the pharmacy and leaving without the prescription. 

 

References:

1:  Mulcahy AW, Whaley C, Tebeka MG, Schwam D, Edenfield N, Becerra-Ornelas AU.   International Prescription Drug Price Comparisons Current Empirical Estimates and Comparisons with Previous Studies.  Rand Corporation Research Report. 2021.

2:  Yetter DM.  Reprieve for Kentucky’s independent pharmacies is saving Medicaid millions.  Kentucky Lantern. October 5, 2023.  https://kentuckylantern.com/2023/10/05/reprieve-for-kentuckys-independent-pharmacies-is-saving-medicaid-millions/

This is the story of how Kentucky eliminated PBMs in their state and saved $283M in three years. 

Graphic credit:

Me - my wife reshot the photo.

How Does The IOM Ignore The Single Most Important Conflict of Interest?

Another free 28 minutes of work for corporate America on their prior authorization procedure.  I won't type out the dialogue and arbitrary holds along the way.  This time I was referred by the pharmacy to one of the major Pharmacy Benefit Managers (PBMs) and after negotiating their queue and listening to about 15 minutes of pure nonsense (privacy notifications for veterans, Medicare programs, etc) I reached a human being.  At that point he advised me that the PBM was not responsible for this particular prescription and I had to contact their insurance company.  He gave me the number and connected me, but of course it involved a queue that had similar recorded messages and then had a difficult time understanding my voice saying: "I am a provider."  I eventually spoke with a human being who had to look up the circumstances that would allow her to approve the prior authorization.  She had no apparent medical training and the criteria that she was reading out of a book could have been applied as easily on the front end by a pharmacist to save me from 28 minutes of free work for a PBM.  And keep in mind this was one prescription that the patient had already been taking.

There is really no excuse at all for this ongoing charade.  At the same time professional groups like the AMA are not able to take any action that would alleviate this burden.  Managed care companies have institutionalized these rules in most states for decades at this point.  It was shocking when I first discovered that.  Look at the state statues and realize that rules stacked against you and your patients are the law.  The law mandates that you need to do all of this work for free for a managed care company.

Today,  I came up with a new idea.  Attorney Generals in the State of Minnesota have a record of activism against health care companies and unfair practices.  I decided to send a letter of my most recent experience with a PBM to the Attorney General's Office along with a copy of a letter I wrote as an opinion piece the Minnesota Medicine a few months ago.  That letter details how these practices disproportionately affect psychiatrists and patients with mental illnesses.  The proposed solution to the problem is a very simple one.  Instead of expecting physicians or their surrogates to endure a 28 minute telephone gauntlet in order to speak to a non professional who is unsteadily reading approval instructions out of manual - give that manual directly to the retail pharmacist.  The 28 minute call would evaporate into a 2 minute call or less.  Better yet, take the physician out of the loop entirely.  There is no way that a physician should collude with a business decision to make money for a managed care company.   If the company refuses the physician order, it should clearly be documented and the next choice should be made (if possible) and designated as not the optimal choice by the physician.

That brings me to the all important issue of conflict of interest.  You can read blogs all over the internet that discuss the issue of pharmaceutical company influence ad nauseum.  The Pharmascolds remain preoccupied with this issue and are apparently unable to see that businesses run according to business ethics (whatever that might be),  clinical trials of practically all drugs are imperfect and no matter how many repeat studies the Cochrane Collaboration wants that basic fact will not change,  and that the FDA is a flawed politically biased agency rather than the guarantor of drug safety.  These are some of the common fallacies that I see played out each day across a number of settings.  At any rate,  just based on the frequency of enraged posts any casual reader would think that this is a daily crisis.  The only significant variant is that physicians and psychiatrists in particular are blamed for the ethical shortcomings of both American businesses and government.

But when you get right down to it - what is conflict of interest?  It is probably useful to use existing definitions rather than my direct observations for the purpose of this post.  There is no more respected body than the Institute of Medicine.  They routinely publish books on health care policy that are widely quoted and their definitions carry some weight.  I don't like their entire conflict of interest policy because they equate the appearance of conflict of interest with conflict of interest.  Congress would probably also have an issue with that definition.  Their basic introductory definition from the reference at the bottom of this page is included in the table below:

  
To keep it simple let's consider the primary interest in this case to be the welfare of patients.  The secondary interests in this case are defined as:  ".... financial gain but also the desire for professional advancement, recognition for personal achievement and favors to friends and family or to students and colleagues.." (p. 47).  They qualify this by saying that financial gain is not necessarily bad and that policies reasonably focus on financial gains but:  "When a secondary interest has inappropriate weight in a decision and distorts the pursuit of a primary interest, it is exerting undue influence."  They go on to define the conflict as any set of circumstances that arises that does not necessarily compromise the primary interest of patient welfare but that merely creates a risk for doing so.

How does this apply to prior authorization?  Prior authorization certainly sets up a secondary interest.  In this case the interest is the financial well being of the managed care company or PBM and in the case of publicly held companies - their shareholders.  From the perspective of the physician the secondary interest is maintaining employment which is the worst case scenario of "professional advancement."  Most employers and insurance companies stipulate that in order to stay employed you have to actively participate in all managed care prior authorizations and utilization review.  I am sure that astute politicians will claim that these surrogates are necessary to control runaway health care costs.  That does not explain how one could come up with a new sets of businesses worth tens of billions of dollars that make their money strictly from rationing pharmaceuticals.  These are companies that arise out of thin air based on the questionable theories of politicians and business people.  It does not explain why they are currently in the business of rationing very inexpensive generic drugs.  It certainly does not explain how there is a direct correlation between managed care rationing and an over 300% increase in health care administrators in the industry.  And most importantly it does not explain the complete failure of the managed care industry to contain health care costs.  In short, anyone espousing the need for expensive administrator heavy systems to control runaway prescribing does not have a leg to stand on.  The secondary interest in this case is clear.  Prior authorization is there to make money for companies and make a lot of it and physicians are forced to participate.    

The second issue here is an interesting and important one.  Physicians don't have to be convinced by flashy ads, salespeople, free samples, or financial inducements.  They are simply coerced.  When their patients are standing in a Walgreens or CVS, they don't have the luxury of saying no or even putting it off until the next day.  A patient who they have seen and assessed needs a medication and something has to be done.  They have to jump through a managed care hoop in order to get the medication that they have already prescribed - paid for.  The only question is: "How high is that hoop?"    

When people talk to me about all of the pharmaceutical company influence and evil marketing practices I don't even blink an eye.  I would like to know how the systematic coercion of the professional judgment of physicians by for profit companies on a national scale is not a far bigger problem than trinkets and pizza from the pharmaceutical industry?  There is no bigger risk of compromising the primary interest of patient welfare.  Patient welfare is always secondary to financial interest of the company involved.  The only case where it is not is if the company agrees with the prescriber, but even then they have created strong disincentives (the gauntlet-like telephone queue) to the accomplishment of the primary goal of prescribing what the physician considers the best possible medication.

I would like to know how the Institute of Medicine can ignore this?           


George Dawson, MD, DFAPA

References:

IOM (Institute of Medicine). Conflict of Interest in Medical Research, Education, and Practice. Washington, DC: The National Academies Press; 2009.

Supplementary 1:  I consider the quotes from the IOM reference to be fair use under the US Copyright Law.

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.