November 2001

National Pharmacy Program Saves Nearly $10 Million

Initiative has positive effect on medication safety, quality of patient care

During the 2001 fiscal year, Catholic Health Initiatives’ National Pharmacy Program saved $9.9 million through market-based organizations’ use of more than 80 different cost-containment initiatives, far exceeding its goal of $6 million in savings.

"It’s important to note that these savings come from new cost-containment initiatives," says George Hill, director of pharmacy services for Catholic Health Initiatives and co-chair of the National Pharmacy Council. "The total doesn’t include savings from pharmacy cost-containment programs that market-based organizations already had in place. Also, though it’s difficult to measure, we saw advancement in the quality of pharmacy practice throughout the system. We hear more examples of
pharmacists who are not just dispensing medication, but are working more closely with physicians, nurses, other direct caregivers and patients."

Much of the National Pharmacy Program’s success comes from closer and more frequent communication among pharmacy directors, according to Ron Broekemeier, director of pharmacy for Franciscan Health System, Tacoma, Wash., who co-chairs the National Pharmacy Council with Hill. "Catholic Health Initiatives’ pharmacy directors meet in six regional clusters two or three times a year and as a national group once a year," he said. "Between meetings, they do a great job of using the phone and email to strategize and provide each other with solutions to common challenges. I think that’s the main reason the program exceeded its savings goal. In addition, pharmacy directors were quick to implement several large-dollar initiatives involving trade-to-generic drug switches. Also, while every market-based organization contributed to the total, some that did not have the opportunity to participate in this type of program in the past generated substantial savings."

The program is already off to a solid start for the current fiscal year, realizing $1.5 million in additional savings during the first quarter. "This puts us in a good position to reach our goal of $4.5 million in incremental savings this year, for cumulative savings of $14.4 million over two years," said Hill. The National Pharmacy Council has two additional goals for fiscal year 2002:

• Market-based organizations will repeat the Institute for Safe Medication Practice Self-assessment Survey™ by January 1, 2002. "The surveys completed during fiscal year 2001 gave market-based organizations a starting point for the creation of multidisciplinary teams to improve medication safety," said Hill. "The repeat of the survey will give them the means to gauge improvement during the past year. Catholic Health Initiatives is one of just a few health providers in the country using the survey in this way."

• The council will identify a non-punitive process for reporting medication errors. "Usually, a cascade of events leads to a medication error and no one individual is to blame," said Hill. "When one individual is blamed and punished, the organization can’t get a true picture of what happened, so the error can occur again. We’re asking pharmacy directors to form multidisciplinary teams to explore investigation methods that concentrate on processes and systems rather than individuals. This is challenging, but if we do it right we will be able to mend broken processes to make medication administration safer for our patients."

Broekemeier notes that the National Pharmacy Program provides opportunities for market-based organizations of all sizes to shine. "Some of our most successful cost-saving initiatives started in smaller rural hospitals," he said. "One of the strengths of the program is that every market-based organization can contribute."

Hill expects that pharmacists throughout Catholic Health Initiatives will continue to expand their clinical role. "Between now and 2008, medication expenditures are expected to increase 117 percent," he said. "Because medications will be more expensive, it will be crucial to ensure that they achieve their desired outcomes. That’s why it is important to have pharmacists actively engaged in patient treatment. It’s integral to quality of patient care and to improving the bottom line."