APPENDIX A

Interim Report of the Committee on VA Pharmacy Formulary Analysis to the Department of Veterans Affairs and the Congress of the United States

JANUARY 28, 2000

This is the interim report specified in VA contract No V101(93)P-1637, Task 10, on the VA pharmacy formulary analysis between the Department of Veterans Affairs (the VA) and the Institute of Medicine (IOM) of the National Academy of Sciences (NAS), effective April 12, 1999. That contract scheduled this report 6 months after the beginning of the project. The report was to be in a form determined by the IOM committee on the VA pharmacy formulary analysis. The IOM committee, meeting in Washington, D.C., on September 30–October 1, 1999, and December 13–14, 1999, decided that the interim report should consist of this short document describing the implementation of the study, progress to date, and the anticipated schedule to completion, supplemented by a briefing by the IOM committee chairman, Dr. David Blumenthal, to the VA and to interested parties and committees of jurisdiction in the Congress. These latter include the House Committee on Appropriations (Congressman Freylinghuysen) and the Senate and House Committees on Veterans Affairs. The IOM committee discussed and approved this interim report, subject to revisions, at its December meeting.

The VA contract for this study requires the IOM to analyze and report on four major congressional concerns. House Report 105-610, which accompanied legislation providing an appropriation for the VA for fiscal year 1999, directed the VA to enter into the contract with the IOM and expressed the four concerns of the Committee on Appropriations. These were also concerns of the Senate and House Committees on Veterans Affairs, and they formed the basis of an audit of the VA National Formulary requested in October 1998 of the General Accounting Office (GAO) by Senator Rockefeller, ranking minority member of the Senate Committee on Veterans Affairs. These concerns or questions in



The National Academies | 500 Fifth St. N.W. | Washington, D.C. 20001
Copyright © National Academy of Sciences. All rights reserved.
Terms of Use and Privacy Statement



Below are the first 10 and last 10 pages of uncorrected machine-read text (when available) of this chapter, followed by the top 30 algorithmically extracted key phrases from the chapter as a whole.
Intended to provide our own search engines and external engines with highly rich, chapter-representative searchable text on the opening pages of each chapter. Because it is UNCORRECTED material, please consider the following text as a useful but insufficient proxy for the authoritative book pages.

Do not use for reproduction, copying, pasting, or reading; exclusively for search engines.

OCR for page 221
DESCRIPTION AND ANALYSIS OF THE VA National Formulary APPENDIX A Interim Report of the Committee on VA Pharmacy Formulary Analysis to the Department of Veterans Affairs and the Congress of the United States JANUARY 28, 2000 This is the interim report specified in VA contract No V101(93)P-1637, Task 10, on the VA pharmacy formulary analysis between the Department of Veterans Affairs (the VA) and the Institute of Medicine (IOM) of the National Academy of Sciences (NAS), effective April 12, 1999. That contract scheduled this report 6 months after the beginning of the project. The report was to be in a form determined by the IOM committee on the VA pharmacy formulary analysis. The IOM committee, meeting in Washington, D.C., on September 30–October 1, 1999, and December 13–14, 1999, decided that the interim report should consist of this short document describing the implementation of the study, progress to date, and the anticipated schedule to completion, supplemented by a briefing by the IOM committee chairman, Dr. David Blumenthal, to the VA and to interested parties and committees of jurisdiction in the Congress. These latter include the House Committee on Appropriations (Congressman Freylinghuysen) and the Senate and House Committees on Veterans Affairs. The IOM committee discussed and approved this interim report, subject to revisions, at its December meeting. The VA contract for this study requires the IOM to analyze and report on four major congressional concerns. House Report 105-610, which accompanied legislation providing an appropriation for the VA for fiscal year 1999, directed the VA to enter into the contract with the IOM and expressed the four concerns of the Committee on Appropriations. These were also concerns of the Senate and House Committees on Veterans Affairs, and they formed the basis of an audit of the VA National Formulary requested in October 1998 of the General Accounting Office (GAO) by Senator Rockefeller, ranking minority member of the Senate Committee on Veterans Affairs. These concerns or questions in

OCR for page 221
DESCRIPTION AND ANALYSIS OF THE VA National Formulary cluded whether the VA National Formulary is overly restrictive, what effect it has on the cost of drugs and related products to the Veterans Health Administration (VHA), what effect it has on quality of care delivered by the VHA to veterans, and how it compares with other formularies in the public and private sector. The IOM study will address and analyze these four issues. At the outset, the IOM reviewed a number of candidates for director of this project, and decided against recruiting new staff from outside the Institute. Instead, Roger Herdman, M.D., Senior Scholar at IOM, was asked to assume the position of responsible study officer. Dr. Herdman was completing a study, the Safety of Silicone Breast Implants, for the House Committee on Appropriations and the Department of Health and Human Services, which was delivered June 14, 1999. This caused some delay in the initial phases of this work. Early contacts were made and discussions held with staff of Congressman Freylinghuysen of the House Appropriations Committee and both majority and minority sides of the Senate and House Committee on Veterans Affairs, however. Follow-up contacts have provided congressional staff with additional information on the project and the study committee. Representatives from the Pharmacy Benefits Management Group of the VA, Mr. Ogden and Mr. Muniz, visited the IOM, briefed IOM staff, and provided helpful information on the National Formulary. Staff began to gather literature on the VA pharmacy benefit and formulary system and formulary systems in general. A list of literature accumulated and reviewed to date is appended to this report. In late spring and early summer of 1999, IOM staff solicited recommendations of candidates for the IOM committee on the VA pharmacy formulary analysis. Recommendations were received from the Pharmaceutical Research and Manufacturers of America, the National Pharmaceutical Council, the American Association of Health Plans, the Academy of Managed Care Pharmacy, members of the academic pharmacy community, a Washington, D.C. consultant on veterans affairs, IOM members, the President of the IOM, and, after his selection and preliminary approval, the committee chairman, Dr. Blumenthal, among others. Responding in part to these recommendations and to independent evaluations, 14 committee appointments were approved in the summer of 1999 by the President of the IOM and the President of the NAS. They represented experience and expertise in veterans affairs, veterans health care and veterans service organizations, clinical medicine and geriatrics, clinical epidemiology, pharmacy and therapeutics committees, managed care and managed care pharmacy, pharmacy benefits management, Medicaid drug benefits, drug utilization review, pharmaceutical standards, clinical pharmacology, the science and practice of pharmacy, nursing, health services research and health care policy, health care management and health economics, pharmacy law, and public health, among others. Committee members came from two veterans service organizations, U.S. medical schools and academic health centers, managed care organizations, schools of pharmacy and nursing, pharmacy benefit management companies, the United States Pharmacopoeia, academic departments of health care policy, law

OCR for page 221
DESCRIPTION AND ANALYSIS OF THE VA National Formulary and economics, and major health care systems and clinics. They were from all sections of the United States, for example, the District of Columbia and the states of Arizona, California, Maryland, Massachusetts, Minnesota, New Jersey, New York, North Carolina, Pennsylvania, and Utah. The Presidents of the IOM and NAS appointed an experienced internist actively seeing patients as chairman of the committee. This appointment and the presence of five physicians on the committee were intended to ensure that this study would focus on quality health care to veterans. The committee roster is attached to this report. During the summer of 1999, IOM staff met with staff of the General Accounting Office (GAO) responsible for the audit of the VA National Formulary to coordinate the IOM and GAO projects and avoid duplication of effort. Coordination meetings with GAO have continued periodically during the course of the IOM study. By August, the IOM recruited and retained the staff for this project, Christine Coussens, Ph.D., Research Associate, and Rita Gaskins, Project Assistant. Also during the summer of 1999, the IOM identified consultants for the VA pharmacy formulary analysis project as specified in the VA contract. After discussion with advisors and potential consultant organizations, the IOM determined that the Harvard Department of Health Care Policy met the requirements for performing the cost analysis of the National Formulary in terms of professional qualifications and experience and could carry out the necessary analyses within the amount budgeted for this subcontract. Staff assigned to this project at Harvard included Richard Frank, Ph.D., Haiden Huskamp, Ph.D., health economists, Arnold Epstein, M.D., medical consultant, and other supporting professionals. These named individuals were made official consultants to the IOM to allow full participation in this work and in meetings of the committee as economic and medical advisors as well as staff responsible for the cost assessment portion of the VA contract. The report of this group, which will comprise the chapter on costs in the final IOM report, was scheduled for completion and delivery to IOM on April 1, 2000. To prepare the separate VA contractual commissioned paper on Medicaid formularies, the IOM selected Jeffrey Brown, a Ph.D. student at Brandeis who was also made an official IOM consultant. He was identified by, and worked under the supervision of, Stephen Soumerai, Sc.D., Professor of Ambulatory Care and Prevention and Director, Drug Policy Research Group, Harvard Medical School. This paper was scheduled for delivery to IOM on February 1, 2000, and has been delivered. On August 18, 19, and 20, 1999, IOM staff, Dr. Haiden Huskamp from the Harvard group performing the cost analysis of the VA formulary, and a member of the IOM committee visited the VA Pharmacy Benefits Management Strategic Healthcare Group and the National Acquisition Center in Chicago to collect information on the management of the National Formulary and formulary system and on price negotiations, contracting and availability of price and other cost data. During this visit, staff and a committee member attended the August 19 and 20 meeting of the VA Medical Advisory Panel to observe the functioning of this VA analogue of a conventional pharmacy and therapeutics committee. During this meeting, presentations and discussions on adding drugs to the for-

OCR for page 221
DESCRIPTION AND ANALYSIS OF THE VA National Formulary mulary, drug class reviews, policies on pill splitting, pharmacogenomics, therapeutic guidelines for COX-2 inhibitors, a second RAND survey of VA physician attitudes and experience with the National Formulary, and dosing schedules, among others, were held. Staff also visited the Lakeside VA hospital in Chicago and discussed formulary matters with medical and pharmacy representatives of that hospital's staff. In September 1999, IOM staff prepared for the first meeting of the IOM committee on VA pharmacy formulary analysis. This meeting took place in the Foundry Building in Georgetown, on September 30 and October 1, 1999, with 100% of the committee in attendance for all or part of the sessions. After a “bias discussion” among committee members to identify and discuss potential biases and conflicts of interest, the meeting was open to the public from 2:30 PM to 5:30 PM on September 30th. During that time the committee heard from Ms. Kim Lipsky, staff to Senator Rockefeller of the Senate Committee on Veterans Affairs. Staff from all the known interested congressional committees had been invited to speak, but except for Ms. Lipsky, were unable to attend due to the press of congressional business. Ms. Lipsky's remarks were followed by a presentation from the VA Pharmacy Benefits Group central and Chicago offices and representatives of the VA Medical Advisory Panel. They provided the committee with information on the formulary and an opportunity to ask questions of responsible VA pharmacy benefit leaders. Thereafter, GAO staff addressed the committee, describing their study of National Formulary operations and responded to committee questions. The committee met in closed session on October 1, 1999, and discussed information on VA formulary policies and procedures, the various tasks or components of the IOM study, the plans of the Harvard Department of Health Care Policy to implement the formulary cost analysis, an outline of the Medicaid commissioned paper, and plans for the committee's continued work. The next meeting of the committee was scheduled for December 13 and 14, 1999. In the interval before the next committee meeting, staff continued to gather data from the literature and from the VA. Repeated contacts for information on policies, procedures, results, and outcomes were made to the VA central office, the Chicago office, each of the 22 regional offices (veterans integrated service networks or VISNs), and many medical centers. In these interactions IOM found VA personnel responsive to requests for data and examples of forms and policies, although IOM staff, the Harvard group, and the committee noted that some VA data that would have informed in a useful way analyses responding to the four major tasks and congressional concerns of the study were not generated by the VA system and therefore not available. VA cost data that were essential to the cost analysis of the National Formulary were not always available in a timely way or contained errors and gaps. Before the December meeting of the committee, draft material relating to several of the study tasks and supporting sections of the report were prepared, including various tables and graphs displaying data obtained from the VA. The second meeting of the committee was held in closed sessions on December 13

OCR for page 221
DESCRIPTION AND ANALYSIS OF THE VA National Formulary and 14 in the Foundry Building. All committee members attended the sessions at least in part. At this meeting the prepared drafts were reviewed and suggestions, made. The Harvard group reported on progress to date and entertained suggestions and comments. A draft of the commissioned paper on Medicaid formularies was available and was reviewed and subject to critique by the committee. Again, the various major components of the study were extensively discussed in light of accumulating data on VA policies and procedures and available draft documents. The committee reviewed data collected from the VA pharmacy benefits managers and VISNs. Data and a survey provided by Pfizer, Inc., were also reviewed and discussed. The committee considered possible conclusions and recommendations for the final report. The draft of this interim report was approved subject to suggested revisions. The third meeting of the committee was scheduled for March 8 and 9, 2000. In January 2000, the IOM and the Harvard group notified the VA that price data that had been requested for relevant years and drugs were not on hand for some of those years and drugs. The Harvard group cautioned that if these data were not available to them by early February 2000, the descriptions and analyses of cost effects of the National Formulary that had been agreed upon with the committee could not be completed in time to meet the congressionally imposed report delivery schedule. After a telephone conference mutually clarifying the needs of the IOM and Harvard and the capacity of the VA, the requisite data began to be rapidly delivered. By the day of this report, the remaining data that the VA system can generate and that the IOM and Harvard need were committed to delivery by no later than the end of January. This would allow performance of the cost subcontract in time for the final IOM report. By the time of this interim report, the committee had reviewed and amended the introduction and chapters on restrictiveness, quality, and comparisons with other formularies (which incorporated the consultant report on Medicaid). Extensive data on elements of restrictiveness current in PBMs and MCOs covering about 200 million lives were being collected nationally. Additional graphs and tables were constructed. At the third meeting of the committee, given timely delivery of the VA data as committed, the committee will discuss the preliminary findings from the Harvard Department of Health Care Policy, and comments and suggestions can then be incorporated into the Harvard preparation and delivery of the cost chapter of the final report by April 1st. At this third meeting, the committee plans to review a final draft of the report (except for the pending cost chapter), and make comments, corrections, and suggestions which will be incorporated into a draft report suitable for review by the National Academy of Sciences' report review process. Reviewers for this final report should be selected by April 1, 2000, and it is anticipated that review comments will be returned by mid-May. It is hoped that reviewer comments can be incorporated and the report approved by the IOM and the NAS sometime in June 2000, preparatory to delivering a prepublication copy of the final report to the sponsor and the Congress, with release to the public to follow. The contractual deadline

OCR for page 221
DESCRIPTION AND ANALYSIS OF THE VA National Formulary for completion of the final, full report specified in the VA contract is the 15th month of the project. Subsequent to the contract terms, the Congress in House Report 106-379 specified July 11, 2000, as the delivery date for the final report. The IOM and the committee on VA pharmacy formulary analysis have planned, scheduled, and intend to meet this delivery deadline.