The Secret Weapon for Improving Clinical Outcomes and Driving Down Health Care Costs

June 19, 2018
Armen Karapetyan

According to the most recent statistics from CMS, Medicare spends 21 percent of its resources on hospital care. Hospital spending is only surpassed by the 30 percent it spends on its Medicare Advantage program which, perhaps ironically, was created, in part, to reduce the expenditures on hospital care. If the goal of Medicare Advantage is to reduce the utilization of hospital care, then medication adherence may actually be the most effective tool in reducing the overall cost of health care. Here is why. Physicians prescribe medications for patients in order to manage their chronic conditions which should reduce the need for hospital care. However, if the patient does not take the prescribed medication at the frequency written on the bottle or at all, what had been a chronic condition can re-emerge as an acute episode that requires a visit to the emergency room or a full-blown hospital readmission.

It is clear that adherence is one of the most important keys to driving down health care costs and improving health outcomes. Adherence means taking a medication as prescribed consistently: right medication, at the right dose, and at the right time. According to a study by Mayo Clinic, 50% of patients are non-adherent which means that for 50% of patients on a chronic condition medication, doses are missed, taken improperly or not taken at all. Non-adherence costs the U.S. 2.3% of GDP or $290 Billion.

The cost of non-adherence is felt across the healthcare ecosystem from increased medical spending by patients and insurance carriers as well as penalties assessed to healthcare providers. Medicare’s shared risk contracting model was established to improve adherence and health outcomes. This risk model assesses penalties to health care providers and Medicare managed care plans for failures to achieve adherence. For instance if a patient was released from the hospital, the hospital is financially penalized for a readmission that occurs within 30 days of discharge. The physician is also penalized as performance related funds are also withheld. Lastly, the health plan may end up with a lower five- star rating if too many of its members/patients are have increasing medical spending and low patient satisfaction scores. This is all on top of the money spent dealing with a preventable episode of care.

Typically, physician practices are tasked with the responsibility of keeping patients on track with taking their medication. But after years of being asked to do more with less, most physicians simply do not have the resources to give managing medication adherence the time and effort it requires.  Most adherence is patient driven, with patients bearing the bulk of the responsibility of filling medication timely and taking it appropriately. This is difficult as chronic conditions are often managed with multiple medications and complicated dosing schedules. For elderly patients and patients with diverse ethnic backgrounds and language barriers, the probability of non-adherence is amplified.

At Pharmco, we have developed a unique program and approach to medication delivery and management which includes medication adherence. We are a subsidiary of Progressive Care and are located in North Miami Beach in Miami-Dade County and not far from the border of Broward County. This is an ideal place for us to be located because Dexur reported that in 2017 the Medicare patient readmission rate was 30.1 percent in Miami-Dade County, FL and 28.3 percent in Broward County, FL. South Florida is densely populated, diverse, and has unique healthcare challenges. PharmCo has dedicated itself to removing impediments to care and adherence which has yielded beneficial results to the community as 92% of PharmCo’s 13,000 patients are adherent.

Pharmco partners with physicians and assists them in managing medication adherence. We do this through no charge value added services that we have integrated into our unique medication distribution solution. Our adherence program includes free delivery, full service inventory of pharmaceutical products, on-site custom compounds, adherence reporting, medication therapy management, and health risk management.

Out suite of services along with a medication pouching system also known as adherence packaging is extremely beneficial for patients on multiple medications. For patients on stable drug regiments to manage a chronic condition, pouch packaging can be the solution that accommodates busy life styles, complicated dosing schedules, and impaired cognitive abilities.

PharmCo's Smart-Pack
PharmCo's Smart-Pack

Our pouching system delivers the patient’s medication in pouches that are marked with the time it is to be taken. This way all of the medications needed at any given time are together in one place, relieving the patient of having to manage taking multiple medications at varying times during the day. Patients can get rid of their multi-compartment pill containers as well as the job of refilling them. We even remind the patients when it is time to reorder their medications and we make that process easy.

But does medication management actually produce measurable results?  We are pleased to tell you that the answer is a resounding yes. A 10% increase in adherence is associated with a 9- 29% decrease in annual health care costs. In fact, medication management, including adherence programs are proven to reduce 30-day hospital readmissions from 25 percent to 10 percent! Increased adherence leads to better health, lower costs, and a less stressed healthcare system. In other words, everyone wins.

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