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April 2003
Strategy
Office Dispensing Can Enhance Care Quality by Helping
to Cut Drug Errors
Richard L. Reece, MD
Edited by: Deborah J. Neveleff
Medical errors are a serious problem that have received much media
attention since the Institute of Medicine reported on medical errors
and health care quality in two reports, To Err Is Human: Building
a Safer Health System in 1999 and Crossing the Quality Chasm: A
New Health System for the 21st Century in 2001. In the reports,
the IOM cited the prevalence of drug reactions and deaths due to
medical errors.
Although some experts have disputed the numbers used in these
reports, there is agreement among many physicians that the increased
workload required of pharmacists, a shortage of pharmacists, and
the rising number of prescriptions have led to an increase in the
number errors that pharmacists make when under pressure.
Rising Demands
In the current health care environment, consumers are demanding
prescription drugs, over-worked physicians are writing more prescriptions,
short-staffed pharmaceutical retailers are processing more prescriptions,
and an increased number of drug reactions and medical errors
are occurring. This environment has led physicians and others
to seek innovative approaches to prescribing medications and
to reducing errors.
One approach to physician prescribing features software systems
that enable physicians to dispense prepackaged medications at the
point of care, meaning while the patient is in the office. User-friendly
and affordable software has been developed to make it practical
for physicians to manage an inventory of medications, track their
own prescribing habits, maintain patient medical records, and check
for drug interactions.
The software that allows physicians to dispense medications in
their offices efficiently actually revives an old tradition. In
the 1880s, 80% of physicians dispensed prescribed drugs in their
offices; but by the 1920s, only 20% of physicians were dispensing
because pharmacists had begun to do much of that work.
Quality Benefits
Dispensing medications in a physician’s office provides benefits
to physicians for several reasons, says Warren Moseley, chairman
and president of Physicians Total Care Inc., in Tulsa, Okla. Physicians
Total Care, a pharmaceutical repackager and wholesale distributor,
offers drug-dispensing software that allows physicians to provide
medications to patients in the office.
“The system is not a threat to pharmacists, in part because
the market is enormous,” says Moseley. “There is currently
a tremendous shortage of pharmacists, which is expected to reach
40% over the next five years. Since the existing system will be
unable to meet the market demand for prescription drugs, something
has to be done to address that problem.”
Furthermore, in-office dispensing offers several enhancements to
quality of care. The first enhancement relates to fewer medication
errors.
“By using a system that is bar code-driven, there is virtually
no chance of error,” Moseley says. “For example, the
drugs distributed by some of the best companies in this business
are repackaged in a manufacturing environment where there is zero
tolerance for error. The bar code is applied in that environment
and the drugs are sealed in child-proof containers. There is virtually
no chance of error due to incorrect drug identification or counts.
In contrast, statistics reveal that medication dispensing errors
occur in about 5% of all prescriptions coming out of a pharmacy.”
Second, patients who are unable to go to a pharmacy easily can
get their medication directly from their physician, a factor that
can help increase patients’ compliance with medication orders.
About 21% of patients never get their prescriptions filled, according
to AARP, in Washington, D.C., and 30% fail to get their medications
refilled, according to The Internist.
Recognizing these statistics, proponents of office dispensing say
that compliance soars when patients leave the office with their
medications in hand. Also, getting a medication from the physician
is more convenient for patients, since they don’t have to
travel to a pharmacy and wait while a pharmacist fills the prescription.
“Compliance with drug therapy is 60% to 70% better when
medications are delivered at the point of care than when patients
are handed a written prescription,” Moseley says. “For
each dollar invested in compliance, $200 to $800 worth of long-term
health care costs are saved. Basically, that means people are taking
their medicine and getting well. In contrast, one third of written
prescriptions are not filled; therefore, patients are going to
the doctor to get all of that fine advice and then they don’t
apply it. Dispensing at the point of care overcomes a good portion
of that noncompliance. Going to the pharmacy is inconvenient.”
Compliance also may be enhanced when a physician can offer a lower
cost medication if a patient is unable or unwilling to pay for
a more expensive prescription. A single mother with two young children
and two prescriptions for an expensive medication might be inclined
to forgo the medication if she is trying to save money, explains
Moseley. “But if the physician knows she is not going to
buy the drugs, he or she may offer lower cost alternative medications,” he
adds.
Increased Awareness
Third, doctors who use an office dispensing system become more
knowledgeable about the costs of medication and of therapeutic
alternatives. As a result, these physicians become more selective
about the medications they prescribe, Moseley says. “They
can track the effect of various antibiotics, for example, to
make sure they are getting the results they want to achieve,” he
explains.
In addition, when doctors dispense medications, they begin to
gain more knowledge about each drug, Moseley states. “When
purchasing the medications for their inventory, physicians learn
about what they are buying,” he points out. “In particular,
they learn more about the therapeutic alternatives and the different
costs of all prescription drugs. Consequently, they are better
able to advise patients because they can select appropriate, cost-effective
medications.”
Fourth, office dispensing ends the risk of errors that result
from illegible handwriting or from mistakes that occur because
the names of so many medications are similar. In most states, however,
in-office dispensing does not obviate the need for a written prescription
form.
Even so, medical errors can still be reduced through in-office
dispensing, Moseley adds. “The office staff is familiar with
the doctor’s handwriting, or can ask the doctor for clarification
if necessary,” he explains. “The doctor always remains
responsible for supervising such activities.”
In his experience with physicians using in-office dispensing systems,
Moseley has found that these systems return to physicians control
over the quality of care they deliver.
Cutting Costs
“
The business of insurance companies is to collect premiums and
minimize claims, which is a legitimate purpose,” Moseley
continues. “But the process of minimizing claims has resulted
in an adversarial relationship among doctors, pharmacy benefit
managers, and insurers. The companies that offer software for physician
dispensing align the purposes of the insurer and the patient with
those of the physician. In other words, doctors are encouraged
to offer the best care in a cost-effective manner, while the patient
gets higher quality, lower cost health care. Office dispensing
helps everyone by making prescriptions more profitable at a lower
cost.”
Office dispensing is an example of a growing trend called point-of-care
medicine. Proponents of this type of care say that many available
systems can help physicians while they are treating patients. For
example, many systems can help physicians offer disease management
or other educational information to patients, allow physicians
to access clinical information via the Internet or other sources
during an office visit, and document the care provided during an
office visit.
“There is no doubt that point-of-care medicine is the new
model for medical excellence and lower health care costs,” Moseley
asserts. “Point-of-care medicine makes sense because the
patient-physician relationship is the backbone of the health system.
It always has been. But the importance of that relationship has
been obscured by the fact that typically someone besides the patient
is paying for the patient’s health care coverage and these
third parties have made decisions on the patient’s behalf.”
Patient Data Needed
To implement these systems, software vendors have to gather insurance
information about the physician’s patients, so the physician
must be willing to make an investment in time and effort to provide
the background information necessary to put the system in place,
Moseley says.
“After that, the physician will need a two-week inventory
of drugs,” Moseley explains. “That’s when physicians
start to look seriously at therapeutic alternatives in terms of
relative cost. Before this, they never looked at their prescribing
habits in this way. Using such systems, virtually all physicians
cut the total medication costs of their patients in half from what
they were before the system was installed.”
In addition, office dispensing requires a moderate initial investment. “Our
licensing fee is $4,000 (plus sales tax) per practice site,” Moseley
explains. “Doctors generally make $4 to $6 per prescription,
and write 40 to 60 prescriptions per day, so cost recovery is rapid.”
For physicians using these systems, the initial cost would be
for a two-week supply of medications, which generally costs about
$2,000 to $4,000 per physician. Other costs would be for a printer
and a bar code reader, which together may cost several hundred
dollars, Moseley explains. Of course, a physician and staff members
will need to be trained to operate these systems, and the training
requires a few hours for each user.
The best companies in the field of providing in-office dispensing
systems will offer telephone and other support while the system
is being set up in the physician’s office.
In addition to Physicians Total Care Inc., other companies in
this field include Allscripts Healthcare Solutions and MedVantx.
One obstacle to the dispensing of drugs by physicians is that
laws in some states prohibit it. Seven states—Massachusetts,
Montana, New Hampshire, New Jersey, New York, Texas, and Utah—either
ban or make it difficult to dispense drugs in the office. The Federal
Trade Commission, however, has said that it regards laws against
physician dispensing as an illegal restraint of trade.
Allocation Issues
“
The New Jersey law, for example, allows doctors to dispense a 72-hour
supply of medications and to make no more than 10% profit from
doing so,” Moseley explains. “Therefore, the issue
in New Jersey is not whether doctors can dispense with competence,
but rather where the profit from dispensing is going. In Texas,
doctors cannot dispense if there is a pharmacy within 35 miles.
Again, the issue is the allocation of profit. Allocation-of-profit
laws are an illegal restraint of trade.” Those laws, if challenged,
should fall, he adds.
Another obstacle is the charge that physician dispensing for a
profit is unethical and leads to overutilization. But Moseley counters
that physician dispensing is not unethical as long it as it does
not exploit the patient for the doctor’s profit.
The issue of making a profit is true for all services provided
by professionals, Moseley explains. Obviously, physicians need
to make a profit from office visits and other services simply to
stay in business, he adds. “A professional license gives
a person the right to do for other people something those people
want to have done for them for their own good and to charge them
for having it done,” he explains. “Everything professionals
do presents ethical dilemmas; the issue is how those dilemmas are
resolved.”
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Edited by Deborah J. Neveleff, in North Potomac, Md.
Companies Offer Dispensing Systems
In addition to Physicians Total Care Inc., in Tulsa, Okla. (at
www.physicianstotalcare.com), other companies offer dispensing
systems for physicians, such as Allscripts Healthcare Solutions
in Libertyville, Ill. (at www.allscripts.com), and MedVantx in
San Diego (at www.medvantx.com).
Allscripts offers a program called FirstFill, which enables physicians
to fill a patient’s first prescription for a commonly prescribed
medication. Rather than give a patient a sample of a medication,
a physician can provide patients with a complete prescription.
This saves them a trip to the pharmacy, which can improve patient
care and increase patient satisfaction. FirstFill helps to improve
patient outcomes, increases compliance with prescriptions, and
allows physicians to demonstrate how to use the medication directly
to the patient, Allscripts says.
MedVantx offers the writeSTART dispensing system that makes medications
available in the physician’s office. It integrates with existing
practice information systems and helps physicians generate ancillary
income, MedVantx says. The program helps to reduce patients’ out-of-pocket
costs and provides data that physicians can use to negotiate with
insurers for higher reimbursement and capitation rates, the company
says.
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