News & Events

Dave Schuetz and Tim Kosty Attending NCPDP’s May Work Group Meetings and 2018 Annual Conference

PHSI President Tim Kosty and PHSI Consultant Dave Schuetz will be attending the National Council for Prescription Drug Programs (NCPDP) Joint Technical Work Group Meetings and Annual Technology & Business Conference May 6 – 9, 2018 at the Westin Kierland in Scottsdale, AZ.  The Work Group Meetings held Sunday and Monday provide a venue for NCPDP members and industry stakeholders to come together to address issues and create solutions for pharmacy and healthcare.

Contact PHSI if you would like to schedule a meeting with Tim or Dave while at the Work Group Meetings and Annual Conference.

New NCPDP Standards Up for CMS Approval

Expect Approval in 2018 or Early 2019 and Deadline for Implementation Before or During 2021

In the next couple of years, the versions of the NCPDP standards used for online claims adjudication and electronic prescriptions will be changing.  Under HIPAA, CMS has the authority to name the specific version of these two standards for use across the industry.  The version currently in use for adjudication is NCPDP Telecommunications Standard D.0, mandatory since January 1, 2012, and the version currently in use for e-prescribing is NCPDP SCRIPT Standard 10.6, mandatory since November 1, 2013.

NCPDP membership started the process to request that CMS create a new rule naming a current version of each standard for use throughout the industry.  The process has progressed further for the SCRIPT Standard for e-prescribing.  On November 28, 2017, CMS published a proposed rule in the Federal Register recommending the adoption of SCRIPT Version 2017071 to become effective on January 1, 2019, at which time SCRIPT Version 10.6 would be retired.  The industry is strongly in favor of moving to the new version, but many consider the proposed deadline to be too aggressive.  During the comment period, parties, such as Surescripts, expressed concern that the January 1, 2019 deadline does not allow participants enough time to develop new software code, test the code internally and with business partners, and implement the software in thousands of practice sites.  Most commenters recommend a deadline that is 24 months from the effective date of the final rule mandating a new version of the SCRIPT Standard.  The industry is waiting for CMS to respond to industry comments and publish the final rule.

The process for naming a new version of the Telecommunications Standard is moving much slower.  At its November 2017 Work Group Meetings, NCPDP membership approved a request proposing Telecommunications Standard F2 to be the next named standard.  NCPDP submits the request via the DSMO (Designated Standard Maintenance Organizations), which forwards the request to the NCVHS (National Committee on Vital and Health Statistics) to send to CMS.  The industry is waiting for NCVHS to hold the appropriate hearing, which is scheduled for 3/26/2018.  If the hearings result in the recommendation to adopt F2, NCVHS will send a letter to the Secretary of HHS, which could lead to CMS publishing a new proposed rule naming F2 as the new standard.  When that event occurs, the industry can offer comments prior to CMS finalizing the rule.  The process to adopt Telecommunications Standard F2 is at least six months behind the process to adopt SCRIPT Standard 2017071, which means the earliest F2 could be adopted is July 2019.

However, it is difficult to predict how long these final approval processes will take.  The industry should expect final approval sometime in 2018 or early 2019.  These developments mean the new standards could be mandatory by 2021.  Pharmacy system vendors, EMR/e-prescribing software vendors, and claims processors should be preparing for these changes.  NCPDP members have access to the documentation created by membership for both SCRIPT and Telecommunications Standards, allowing for preparation to begin now.

Even though each standard will likely follow their own timeline, the possibility exists that individual development, testing and implementation of the changes to the two standards will overlap.  Vendors will need to size up each change and make sure to allocate the proper resources to meet the deadlines CMS will define in the final rules. PHSI will provide an update once CMS acts and publishes the final rules.

 

2018 Spring Newsletter

New & Improved Medicare Cards to Arrive Starting April 2018

Welcome Kinley Ruthann Ellek

New & Improved Medicare Cards to Arrive Starting April 2018

The Centers for Medicare & Medicaid Services (CMS) is implementing a fraud prevention initiative that removes Social Security Numbers (SSNs) from Medicare cards to help combat identity theft.  Because of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), the current SSN-based Health Insurance Claim Number (HICN) identifier will be replaced by a new Medicare Beneficiary Identifier (MBI) by April 2019.  Under the new system, for each person enrolled in Medicare, a new MBI will be assigned and a new Medicare card issued.  As with the SSN-based HICN, the MBI is confidential and should be handled and protected as Personally Identifiable Information.

The unique, alpha-numeric, randomly-generated 11-character MBI will be clearly different than the HICN number, and possess “non-intelligent” make-up (i.e., void of any hidden or special meaning).  The changeover will commence April 2018, starting with the mailing of new Medicare cards.  The mailings will be completed in phases by geographic location.  A transition period for Medicare beneficiaries to use either the HICN or MBI to exchange data will begin no earlier than April 1, 2018 and run through December 31, 2019.  Starting January 1, 2020, claims are to be submitted using MBIs, with a few exceptions pertaining to specific plans and fee-for-service claims.  Beneficiaries will not need to worry about coverage changes; the MBI will not alter Medicare benefits.

Personal identity theft affects a large and increasing number of seniors.  Individuals age 65 and older are increasingly found to be victims; incidents among this population increased from 2.1 to 2.6 million between 2012 and 2014, according to the Department of Justice.  Beyond the emotional toll, identify theft is financially taxing: two/thirds of all victims reported a direct financial loss.  Further, it disrupts lives, can damage credit ratings, and result in inaccuracies in medical records and costly false claims.  A sample of the new cards is shown below.

Medicare Card Image
Additional Items to Consider:

  • The new card design was:
    • Consumer tested by Medicare beneficiaries
    • Selected among 10 possible card designs
    • Preferred due to the maintenance of a red, white and blue color palette
    • Easy to read, copy, and scan at provider offices
    • A Smaller size to match the size of a standard credit card
    • Bilingual in English/Spanish
    • Lacking a gender and signature line, which did appear on traditional Medicare cards
    • Printed on white paper for all cards, including those for Puerto Rico
  • Destroy the old Medicare card
    • Once the new Medicare card has been received, patients should destroy the old Medicare card, and start using the new card right away
  • The new card is paper
    • Paper cards are easier for many providers to use and copy, and they save taxpayers money
    • Beneficiaries can print replacement cards, if needed
  • Keep your Medicare Advantage Card
    • If a patient is a beneficiary of a Medicare Advantage Plan (HMO or PPO), their Medicare Advantage Plan ID card is their main card for Medicare, so they should keep and use it whenever care is needed

The new Medicare identification cards offer greater fraud protection for beneficiaries.  The pharmacy can assist in educating patients and caregivers to ensure a smooth transition.

 

 

2018 Spring Newsletter

New NCPDP Standards Up for CMS Approval

Welcome Kinley Ruthann Ellek

Welcome Kinley Ruthann Ellek

On behalf of the entire PHSI team, our heartfelt congratulations to Ashley and George Ellek.  They are the proud parents of a beautiful baby girl, Kinley Ruthann.  Kinley was born on Tuesday, February 20th at 12:07 am, weighing 9lbs 1 oz and 20.5 inches long.  The family is tickled pink with the birth of their first child.


Kinley photo

2018 Spring Newsletter

New NCPDP Standards Up for CMS Approval

New & Improved Medicare Cards to Arrive Starting April 2018

PHSI Attending Asembia’s 2018 Specialty Pharmacy Summit

PHSI Vice President Don Dietz and Director of Business Development Fred Hamlin will be attending Asembia’s 2018 Specialty Pharmacy Summit in Las Vegas on April 29 to May 1, 2018.  The summit welcomes thousands of attendees including senior executives and key decision makers from pharmacies, pharma/biotech manufacturers, payers, wholesalers/distributors, health systems, consultants, healthcare technology companies and other industry stakeholder organizations.

Contact PHSI to schedule a meeting with Don and Fred at the conference.

ComputerTalk for the Pharmacist January/February 2018

PHSI President Tim Kosty and Vice President Don Dietz contributed to the January/February 2018 edition of ComputerTalk for the Pharmacist. In their Viewpoints article, Tim and Don identify the expectations for 2018 including generic deflation and vertical integration through mergers and acquisitions.

Click here to read Tim and Don’s article entitled “2018 Expectations”. You can read full versions of current and past ComputerTalk issues at http://www.computertalk.com/issues-archive.

PHSI to Attend AMCP Annual Meeting

PHSI Vice President Don Dietz and Director of Business Development Fred Hamlin will be attending AMCP’s Annual Meeting on April 23-35, 2018 in Boston, MA. If you would like to schedule a meeting with Don or Fred during the conference, click here to contact PHSI.

New Revenue Streams for Pharmacy Presented at ASAP by Don Dietz

PHSI Vice President Don Dietz presented at the American Society for Automation in Pharmacy (ASAP) 2018 Annual Conference.  Don discussed new revenue streams for pharmacies. Click here to view Don’s presentation slides. You can access all of the 2018 ASAP Annual Conference presentations at http://www.asapnet.org.

2018 Winter Newsletter- $4 Generic Lists: A Declining Proposition

Although discount generic lists were the centerpiece of many retail pharmacy advertising campaigns in the early 2010s, we rarely hear pharmacies tout their existence today.  Instead of being front and center on retail pharmacy webpages, discount generic lists are now embedded deeper within the websites, if listed at all.  PHSI first looked at the changing landscape of discount generic programs three years ago in our Winter 2015 Newsletter.  Since then, PHSI has continued to track the product offerings on these lists and noted decreasing or stagnant offerings.

Although generic drug pricing is currently in a deflationary period, pharmacy chains have not increased the number of products listed on their discount generic lists.  In the past, rising generic costs made the inclusion of many products unsustainable, but for many generics, this is no longer the case.  PHSI has tracked the discount generic programs of major pharmacy chains since 2012 and found that all chains have decreased the number of medications offered.  The chart below illustrates the annual changes in the number of included drugs.

Discount Generic Lists Chart

Walgreens still has the most robust generic drug program, with approximately 537 drugs included in 2017, while CVS has essentially discontinued their discount generic list.  CVS moved to a new “Reduced Rx Savings Program”, which only includes three Novolin insulin products.  While some pharmacy discount generic lists contain niche products, 124 drugs appear on all eight pharmacy lists.  These drugs are commodity generics and include meloxicam, metformin, lisinopril, amoxicillin, benazepril, citalopram, and clonidine, among others.  At acquisition costs of pennies per unit, these products can still provide modest revenue and a positive gross margin.

With the increasing prevalence of high deductible plans, we could see a rise in the popularity of discount generic lists.  High deductible health plans are forcing patients to become more price-driven in their search for pharmaceuticals, as flat-dollar copays are replaced in the deductible stage.  Stakeholders should expect patients in plans with a prescription deductible to behave more like cash-paying patients versus traditional commercially insured patients.  Competitive cash pricing will appeal to these patients.

Despite modest attention from patients in prescription deductible plans, will we see a resurgence in $4 lists?  PHSI’s answer… probably not.  While Walmart’s $4 list is an enticement to get patients into their stores, pharmacy chains do not make enough dollar profits on these programs to expand them.  Pharmacies analyze their PBM reimbursement rates when considering new candidates for discount generic lists or for eliminating current products.  With 90+% of drugs being reimbursed via third party insurance, pharmacies do not want to change their Usual and Customary (U&C) pricing to invoke the “lower of” clause in their PBM contracts, reducing the profitability on the vast majority of their prescriptions.  PHSI will continue to monitor discount generic drug lists and publish updates identifying changing market strategies.

 

2018 Winter Newsletter- 2017 New Drug Approvals

2018 Winter Newsletter- 2017 New Drug Approvals

2017 had the most drug approvals this decade, more than double the number approved in a disappointing 2016.  The FDA approved 46 new molecular entities and many other approvals for new indications, dosage forms, and formulations.  The following chart depicts the number of new drug approvals in recent years.

Novel Drug Approvals

Trends in Approvals

Oncology

Oncology is the therapeutic category with the most drug approvals in 2017.  The FDA approved 11 new drugs for different forms of cancer:  Aliqopa, Alunbrig, Bavencio, Besponsa, Calquence, Idhifa, Imfinzi, Kisqali, Nerlynx, Verzenio, and Zejula.

Neurology

Neurology increased from four in 2016 to seven in 2017.  The new medications for neurological conditions are Ingrezza for tardive dyskinesia, Austedo for chorea associated with Huntington’s disease, Brineura for Batten disease, Emflaza for Duchenne muscular dystrophy, Ocrevus for multiple sclerosis, Radicava for ALS, and Xadago for Parkinson’s disease.

Inflammatory Conditions

Two new treatments for plaque psoriasis, Siliq and Tremfya, and one treatment for rheumatoid arthritis, Kevzara, were approved in 2017.

Diabetes

Ozempic and Steglatro were approved for patients with Type 2 diabetes in 2017, up from one new drug approval in 2016 (Adlyxin).

PHSI analyzed the FDA approvals and categorized them by approval type, indication, and other factors, as shown in the following table.  PHSI identified drugs which were considered First-in-Class, and those that are Drugs for Rare Diseases, also known as orphan drugs.  2017 was a big year for orphan drugs, representing nearly 40% of new drug approvals.

PHSI segmented approvals by timing considered by the FDA including Fast Track, Breakthrough Therapy, and Accelerated Approval.  In some cases, more than one accelerated designation was employed to help bring the drug to market.

Specific Approval Types for 2017 Approvals (Final)

This article only contains new molecular entities approved in 2017.  To see all of the over 4,000 approvals that occurred in 2017, please visit the FDA’s Drugs@FDA website.

Sources:

U.S. Food and Drug Administration.  “Novel Drug Approvals for 2017.”  Last Updated January 11, 2018.  Available https://www.fda.gov/Drugs/DevelopmentApprovalProcess/DrugInnovation/ucm537040.htm.  Accessed January 11, 2018.

U.S. Food and Drug Administration Center for Drug Evaluation and Research.  “Advancing Health through Innovation:  2017 New Drug Therapy Approvals.”  January 2018.  Available https://www.fda.gov/downloads/AboutFDA/CentersOffices/OfficeofMedicalProductsandTobacco/CDER/ReportsBudgets/UCM591976.pdf.  Accessed January 11, 2018.

 

2018 Winter Newsletter- $4 Generic Lists: A Declining Proposition