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NACDS IS EXPLORING PSAOs FOR POSSIBLE INVOLVEMENT, TREASURER BEGLEY REPORTS; PHARMACISTS HAVE "SPECTRUM" OF OPTIONS IN NEW DELIVERY SYSTEMS, PROF SAYS

Executive Summary

The National Association of Chain Drug Stores is exploring pharmacy services administrative organizations (PSAOs) and potential association involvement in them, NACDS Treasurer Robert Begley report at a Sept. 8 session of the association's pharmaceutical conference in Orlando, Fla. "A special executive committee meeting is scheduled later this month [Sept. 23] in order to examine the possible role of NACDS" with regard to PSAOs, Begley said. The committee agenda is likely to include how PSAOs operate, positive and negative aspects, and, possibly, whether NACDS should encourage chain participation, organize its own PSAO, or simply monitor the trend. Northwestern University's Health Services and Policy Research Center Director Edward Hughes, MD, told the conference that PSAOs can help pharmacists establish new "managerial" roles. For example, smaller pharmacy operations, he observed, are "enhancing traditional marketing presence" through Medicaid contracts with local health maintenance organizations (HMOs). Other pharmacy options for alternative health care delivery systems include running in-house pharmacies for health maintenance organizations (HMOs) and other health care delivery programs, Hughes maintained. He asserted that a "spectrum of options" exists for pharmacies in the changing health marketplace. "Major opportunities" exist for pharmacists to run in-house HMO pharmacies and to "enter into exclusive contractual arrangements" with HMOs and independent practice associations (IPAs), he maintained, particularly with those HMOs that have not yet explored external pharmacy options. IPAs, organizations that contract with physicians in solo or group practices to provide health services, provide an especially rich area for new pharmacy business, Hughes said. For example, he said, a 1984 University of Maryland survey of pharmacy distribution in managed care systems found that 53% of IPAs still use "traditional" pharmacy distribution methods, such as fee for service. In contrast, 46% of HMOs with their own physician groups already have in-house pharmacy services, and 50% have exclusive contractual arrangements with a pharmacy provider. Hughes advised that pharmacists investigate organized health care businesses, and he predicted that by 1995 enrollment in HMOs will double or triple to "20-30%" of the population. Factors such as an aging population, physician surplus, technological advances, health insurance problems, and AIDS will contribute to development of alternative health systems, he said. HMOs need pharmacy "partners" for formulary development, Hughes maintained. Although "at the moment . . . price is the most important component" health systems want from pharmacies, he predicted that need for pharmacy assistance is growing. HMOs "are desperately looking for assistance with claims processing . . . and formulary development," he said. "We essentially are ushering into American medicine an era of managed care . . . [that has had] a major impact on pharmaceutical distribution." HMOs, IPAs, and preferred provider organizations (PPOs) "have enhanced the development of formularies, developed generic substitution, and also developed a management information system," Hughes said. New opportunities for pharmacists as members of a "therapeutic team" within the new organizations will involve drug utilization review, Hughes declared. He explained that HMOs need "pharmaceutical education" and experts to judge "what works and what doesn't and what they should prescribe." Also, patient counseling services will give health care businesses "a competitive edge" and add to the "building blocks of the future health care enterprise."
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