Counseling in an Outpatient Pharmacy
The correlation between the pharmacist time required for counseling patients and the characteristics of the services provided was studied.
Data from the Kaiser Permanente/USC Patient Consultation Study were used to examine the relationship between pharmacist time and potential problems, actions to resolve the problems, and disposition of prescriptions. A regression model was estimated with pharmacist time as the dependent variable.
An encounter consisting of patient contact to monitor adverse effects, duplicate therapy, or compliance took an estimated three minutes on average. Problems related to appropriateness of therapy or drug interactions required an additional 1.8 and 0.5 minutes, respectively. Four additional minutes were required for provider contact unless the contact involved a simple clarification (an additional 2.6 minutes). Patient referrals required an additional 2.5 minutes. The time requirements related to the problem addressed and action taken were not additive. The incremental time requirements across alternative problem-action clusters ranged from 2.9 to 9 minutes.
A fee-for-service payment system appears to be feasible for pharmacist counseling services.
Health insurance companies, government programs such as Medicaid, and many health maintenance organizations (HMOs) contract with prescription benefit management systems, chain drugstores, and independent pharmacies for the dispensing of prescription drugs to their members. The payments made to dispensing pharmacies are commonly based on the cost of the medication dispensed (ingredient costs), plus a standard dispensing fee to cover the routine pharmaceutical services and overhead required to stock and dispense the drug. These fees may be established unilaterally by the payer (e.g., Medicaid) or may be set through contract negotiations. However, few payment systems specify a range of dispensing fees designed to reimburse pharmacists for nonroutine patient-counseling services. As a result, pharmacists are discouraged from providing more intensive counseling to patients.
Health insurance companies and HMOs may be willing to pay for nonroutine pharmacist consultations if these services prove to be effective in reducing health care costs and improving drug therapy outcomes. Payment systems for professional pharmacy services must be built on the payers' experience with systems designed to pay for other health care services. Therefore, special attention must be paid to the problems that have affected these reimbursement systems in the past.
Medicare's system for reimbursing physicians for their services provides a useful point of reference. The Medicare billing codes for physician services are designed to reflect the amount of time required to provide each service. For example, physician office and outpatient visits are covered by 10 billing categories that depend on the status of the patient (i.e., new versus established), the comprehensiveness of the history and treatment required during the visit, and the complexity of the medical decisions. This approach has several well-recognized limitations. First, the categories covering physician services are often difficult to verify, because the payer cannot confirm the comprehensiveness and complexity of the specific services provided. In the case of office visits, the payer can verify the patient's status, but the comprehensiveness of the history and treatment required during the visit cannot be easily quantified. As a result, some physicians overcharge payers by using codes for more involved office visits than actually took place.
Historically, physician fees have been set on the basis of criteria defining usual, customary, and reasonable fees. After 25 years of operation, Medicare found it necessary to establish a prospective fee schedule based on the estimated resource cost associated with physician services. This schedule was needed to correct the inequalities and fee inflation inherent in a "usual, customary, and reasonable" pricing system. Any resource-based fee system must be continually updated, however, to reflect technological change, inflation, and supply and demand.
The number of payment codes currently specified for medical services complicates strategies for controlling physicians' responses to changes in the payment system and for setting fee levels through competitive pricing systems. For example, Medicare has invested in research designed to bundle physician services into units based on episodes of care or episodes of illness in an effort to avoid misrepresentation of services delivered and provision of unnecessary services to compensate for reductions in fees.
Given the history associated with payment for physician services, a fee-for-service system for pharmacist counseling must meet the following criteria to be acceptable to both pharmacists and insurers:
We used data from the Kaiser Permanente/USC Patient Consultation Study to investigate the feasibility of creating a payment system for pharmacist counseling that meets these criteria. Pharmacist-patient encounter data, including the type of problems encountered, the actions taken, the disposition of the prescription, and a self-report of the time required to complete the counseling, were collected at the time of dispensing. We then investigated the relationship between the characteristics of the encounters and pharmacist time. Specific attention was paid to differentiating between those clusters of problems, actions, and dispositions (PADs) that constituted a routine encounter and PADs for which a separate fee could be justified because of increased pharmacist time requirements.
The correlation between the pharmacist time required for counseling patients and the characteristics of the services provided was studied.
Data from the Kaiser Permanente/USC Patient Consultation Study were used to examine the relationship between pharmacist time and potential problems, actions to resolve the problems, and disposition of prescriptions. A regression model was estimated with pharmacist time as the dependent variable.
An encounter consisting of patient contact to monitor adverse effects, duplicate therapy, or compliance took an estimated three minutes on average. Problems related to appropriateness of therapy or drug interactions required an additional 1.8 and 0.5 minutes, respectively. Four additional minutes were required for provider contact unless the contact involved a simple clarification (an additional 2.6 minutes). Patient referrals required an additional 2.5 minutes. The time requirements related to the problem addressed and action taken were not additive. The incremental time requirements across alternative problem-action clusters ranged from 2.9 to 9 minutes.
A fee-for-service payment system appears to be feasible for pharmacist counseling services.
Health insurance companies, government programs such as Medicaid, and many health maintenance organizations (HMOs) contract with prescription benefit management systems, chain drugstores, and independent pharmacies for the dispensing of prescription drugs to their members. The payments made to dispensing pharmacies are commonly based on the cost of the medication dispensed (ingredient costs), plus a standard dispensing fee to cover the routine pharmaceutical services and overhead required to stock and dispense the drug. These fees may be established unilaterally by the payer (e.g., Medicaid) or may be set through contract negotiations. However, few payment systems specify a range of dispensing fees designed to reimburse pharmacists for nonroutine patient-counseling services. As a result, pharmacists are discouraged from providing more intensive counseling to patients.
Health insurance companies and HMOs may be willing to pay for nonroutine pharmacist consultations if these services prove to be effective in reducing health care costs and improving drug therapy outcomes. Payment systems for professional pharmacy services must be built on the payers' experience with systems designed to pay for other health care services. Therefore, special attention must be paid to the problems that have affected these reimbursement systems in the past.
Medicare's system for reimbursing physicians for their services provides a useful point of reference. The Medicare billing codes for physician services are designed to reflect the amount of time required to provide each service. For example, physician office and outpatient visits are covered by 10 billing categories that depend on the status of the patient (i.e., new versus established), the comprehensiveness of the history and treatment required during the visit, and the complexity of the medical decisions. This approach has several well-recognized limitations. First, the categories covering physician services are often difficult to verify, because the payer cannot confirm the comprehensiveness and complexity of the specific services provided. In the case of office visits, the payer can verify the patient's status, but the comprehensiveness of the history and treatment required during the visit cannot be easily quantified. As a result, some physicians overcharge payers by using codes for more involved office visits than actually took place.
Historically, physician fees have been set on the basis of criteria defining usual, customary, and reasonable fees. After 25 years of operation, Medicare found it necessary to establish a prospective fee schedule based on the estimated resource cost associated with physician services. This schedule was needed to correct the inequalities and fee inflation inherent in a "usual, customary, and reasonable" pricing system. Any resource-based fee system must be continually updated, however, to reflect technological change, inflation, and supply and demand.
The number of payment codes currently specified for medical services complicates strategies for controlling physicians' responses to changes in the payment system and for setting fee levels through competitive pricing systems. For example, Medicare has invested in research designed to bundle physician services into units based on episodes of care or episodes of illness in an effort to avoid misrepresentation of services delivered and provision of unnecessary services to compensate for reductions in fees.
Given the history associated with payment for physician services, a fee-for-service system for pharmacist counseling must meet the following criteria to be acceptable to both pharmacists and insurers:
Specific units of service must be defined that reflect the cost of pharmacist time used for providing the service.
The payer must be able to verify which services were provided.
The number of distinct pharmacist counseling services defined for payment must be limited to facilitate fee negotiations.
We used data from the Kaiser Permanente/USC Patient Consultation Study to investigate the feasibility of creating a payment system for pharmacist counseling that meets these criteria. Pharmacist-patient encounter data, including the type of problems encountered, the actions taken, the disposition of the prescription, and a self-report of the time required to complete the counseling, were collected at the time of dispensing. We then investigated the relationship between the characteristics of the encounters and pharmacist time. Specific attention was paid to differentiating between those clusters of problems, actions, and dispositions (PADs) that constituted a routine encounter and PADs for which a separate fee could be justified because of increased pharmacist time requirements.
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