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Executive Summary

Virginia's state Medicaid agency will conduct a pilot program in conjunction with a task force established by the National Pharmaceutical Council beginning in early 1994 to evaluate the effect of improved patient compliance on overall state Medicaid spending as an alternative to prior authorization for prescription drug prescribing. Virginia Medicaid is seeking to avoid the implementation of a mandatory prior authorization policy by backing a program proposed by the industry group that would educate physicians and pharmacists to enhance patient adherence to treatment regimens and thereby reduce Medicaid expenditures for repeat office visits, emergency room care and hospitalizations. The one-to-three year project will receive partial funding from the Task Force on Compliance, a consortium of 22 pharmaceutical companies founded in conjunction with the NPC to assess and disseminate information on the cost savings of patient compliance to health care programs. The pilot program's scope will be limited to several illnesses in which patient compliance is identified as a significant problem. Among the conditions that are being considered for the program are asthma, arthritis, otitis media, smoking and epilepsy. Physicians and pharmacists in the program will undergo peer training to improve techniques and interpersonal skills to communicate better with the patients about the importance of staying on a particular medication. The training program will draw on currently established company educational programs in the specific disease areas. Health care professionals not participating in the program may be subject to mandatory prior authorization from Virginia Medicaid for prescribing and dispensing of drugs. The research relating to the assessment of increased patient compliance and expected cost savings will be conducted by Medical College of Virginia pharmacist Ralph Small, who has undertaken drug utilization research before. Small was involved recently in educational programs designed to motivate physicians to reduce utilization of H[2] antagonists by switching from high to low doses for maintenance therapy after patients' ulcers had healed. Providers volunteered to try the educational method to reduce costs after Virginia Medicaid proposed to go to a competitive bidding system for pharmacies. Small was the co-author of a recently presented study that found that 20% of nursing home patients receive antiulcer drugs, 59% of those being on maintenance therapy ("The Pink Sheet" Nov. 15, T&G-9). Baltimore-based COMSORT, a firm specializing in creating educational programs that focus on the patient-provider relationship and quality of care, will assist in the development of the educational programs for the Medicaid pilot project. COMSORT also administers the Task Force on Compliance, which is chaired by DuPont Merck's Hazle Shorter, MD. A report released by the task force on Nov. 22, entitled "Noncompliance with Medications: An Economic Tragedy with Important Implications for Health Care Reform," estimates that poor patient compliance to drug regimens costs $100 bil. annually in medical bills and lost productivity in the U.S. The report cites an American Association of Retired Persons survey that shows that 42% of people age 45 and older do not comply with their physicians' instructions. Of those, 29% stop taking the medication before it runs out, 22% take less of the drug than prescribed, 14% do not fill their prescription and 13% fill their prescriptions but do not take the drugs.

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