How to rein in drug costs while improving patient care: 4 Qs with a pharmacy expert

To protect their bottom line amid ever-increasing drug prices, most hospitals agree they must implement cost containment strategies for medication spend.  However, realizing and sustaining cost savings over time is an achievement few obtain.

It's not enough to just standardize drug products or purchase cheaper medications. Hospitals should also analyze physician prescribing patterns to ensure continued cost savings, according to Kathy Chase, PharmD, product leader for the Drug Cost Control Service of Cardinal Health.

"The standard of care today may not be the standard of care tomorrow, so you need to continually look for the next thing to effect change on," she says. "Constantly assessing whether you're using the most cost-effective prescribing practices will really help you manage overall cost in the long term."

Dr. Chase has more than 30 years of hospital pharmacy experience, serving as a pharmacy director and clinical leader before joining Cardinal Health in 2003. She spoke with Becker's Hospital Review about the importance of tracking physician prescribing patterns and how hospitals can use this information to rein in drug costs while improving patient care.

Note: Responses have been slightly edited for length and clarity.

Question: Why should hospitals look beyond drug pricing to realize cost savings?

Dr. Kathy Chase: Price is what hospitals have looked at from the beginning. But cost contains two elements — the price of the product and how it's utilized. Hospitals often focus on whether they're getting the best contract, buying the lowest cost product or standardizing items to save money. But that's just one piece of it and doesn't protect against inflation. That protection comes from focusing on how the drug is used. Hospitals should ask who is prescribing the drug, what they are prescribing it for and whether this behavior aligns with best practices in the marketplace and industry. These factors can play a pivotal role in managing overall cost.

Q: Where can hospitals find hidden savings opportunities? What kind of data can hospitals use to uncover the opportunities?

KC: Savings opportunities are often hiding within physician practice patterns. Hospitals should look for key prescribers and what drugs they're using for certain diseases before comparing them to peers both in and outside of their organization. A lot of health systems do a great job comparing against their own hospitals, but not hospitals outside their organizations. A physician could be an internal leader for best prescribing practice, but far behind other state-of-the-art practices happening externally. Looking at both internal and external benchmarks to give you insight into potential cost saving opportunities can be key.

You can use surrogate data, such as length- of- stay, to get a sense of what the patient outcome is for each drug. For example, a hospital can easily compare different drug regimens for pneumonia and see which has the shortest length of stay or how much additional drug therapy had to be added. This can help hospitals identify the most cost-effective therapies that have good patient outcomes.

Q: What are the top activities a health system should consider to effectively implement a systematic approach to help reduce drug costs?

KC: Hospitals need to look at their data on a regular basis. Most hospitals know what drugs are the top cost drivers. They should focus on those top drivers and determine whether current utilization is appropriate for their patient population or if there is an opportunity for improvement. After identifying an opportunity for improvement, hospitals should put methodologies in place to drive change and measure results for at least six to 12 months. We typically see clinicians adopting the change within the first couple of months, before falling back to old practice patterns around month four or five. Several factors can hinder progress, such as hiring new physicians who are unaware of the utilization initiative or implementing an EHR that changes the prescribing process.

Q: What is the best way to sustain results over time?

KC: It's really about following what's going on for an extended period of time — whether through scorecards or metrics — and having a team that is accountable for that. In hospitals, a Pharmacy and Therapeutics Committee should assess this data on a regular basis. I also think that it's important to engage other departments. For example, a critical care committee might monitor prescribing practices in the intensive care unit, whereas an antimicrobial stewardship committee might look at antibiotic use. Separating the data analysis into practice areas can be helpful to engage specialists who are committed to a high standard of care and help drive change in prescribing practices.

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