Prescriptions and Policy

April Baer- Last year, the Cleveland Clinic decided not to continue running Metrohealth's outpatient pharmacies. Can you give us some background on how decided to respond to the change?

Terry White- Well I think it was a mutual decision, because we felt that we wanted to become more directly involved in this very important program and once again maintain our own control of our own destiny around this and manage it a little bit differently than it had been. So we had some concerns about the customer relations and things, and we wanted to implement some new approaches for how we wanted to deliver the service, and one of them was to try o implement a whole new system, including a new "retail", computer-assisted approach to this, to allow us the opportunity to improve our customer service; that was by bar coding and getting into our retail system, which we purchased late in 1999. We wanted to start off the new year with a new system that, after 30 days, would probably be able to handle up to - by some estimates - 85% of our business on refills by telephone, which would really improve the customer service. So we launched into the new program January 1st knowing that there would be some challenges the first 30 days--until we could get the information in the system, recorded, so we could move on to the new system. What we did not anticipate was what - on average - we had been doing during the week. The average daily was about six to seven hundred different prescriptions. The first day we were hit with twelve hundred. And we've been doing some analysis of why the first day we were so busy. We think we have some ideas - preliminary ideas - on what that was. We've had flu season. We had a real run on antibiotics that day - probably because Friday was a holiday. When we opened up Monday there was a backlog of demand because of the flu situation, and probably also for some refills, because of the start of the new year. Wednesday the volume went down to just above the regular levels. And today we don't really know. We think that this is a short term problem. In fact we have a great hope that as we move on we will really improve the service. I guess it's a case sometimes that things have to get a little bit worse before they get better. And it was a major change in the approach. And if you know the history - we recognized a long time ago that one of the reasons hospitals have a difficult time running a pharmacy is that essentially they were trying to run them with in-patient pharmacy systems. What we chose to do that if we were going to get back into management was to invest in a retail out-patient pharmacy system to support that. And that's why we're doing it.

AB- So the computer system's on track now?

TW- It's (the new system) is working - it was just a little bit more slowly initially. The value of the computer system will not really be realized until 30 days into the system, when people start coming back for refills. This first month you have to enter the information, so then the refills can be done through the system.

AB- The Metrohealth Pharmacies are unique in that they offer prescription subsidies for people who can't pay for medicine. How much is this costing?

TW- I think the overall budget is in the area of around six million dollars a year. I think we'll have better data in terms of how much we're underwriting as we go into the year. A lot of that will relate to the demand, what level it is. And as you can see there is a great demand for subsidized pharmaceuticals. You know the national debate now over the availability of pharmaceuticals is really playing out at Metrohealth, because we are the only hospital-based outpatient pharmacy left in the city, and certainly the only one that provides - through a rating system - everything from free [prescriptions] to a portion of costs for the drugs.

AB- How d you determine who qualifies for prescription subsidies?

Dr. Melinda Estes- The pharmacy is a full service pharmacy that will serve any patient of the Metrohealth system, so our employees use it, as well as our patients. What makes this pharmacy particularly unique is the subsidized nature of some of the drugs. It goes along with the mission of Metrohealth, which is to care for any patient in Cuyahoga County - regardless of their ability to pay. So when we take care of a patient here - obviously whether you're in the outpatient setting or the inpatient setting - pharmaceuticals are often part of that care. So based on your income, you are rated - just as we have a rating system for payment of hospital bills - same thing applies to the pharmacy. Since we are the only pharmacy in town that does that, we often fill a number of prescriptions from people who see physicians outside of the Metrohealth system, but continue to qualify for subsidized pharmaceuticals because of their income status.

AB- How much of the pharmacy's business do the subsidized drugs make up?

ME- I'm not sure I can give you percentage on that. I think having seen the lengthy lines on Monday and Tuesday, and the fact that on a routine day we fill between six and seven hundred prescriptions, I think it tells you that it is not only people below the poverty line but a good number of people we might classify as working poor, who simply cannot afford the high cost of pharmaceuticals.

AB- Has the demand for the rated prescriptions increased over the past few years?

TW- If you put it in the context of the total charity demand on Metro, it looks like in 1999 we're going to do 92 ninety-two million dollars worth of charity care - largest in the state of Ohio. And that is dramatically increased. I think as recently as a few years ago we were at fifty [million dollars]. So if you look at the absolute numbers, you can measure that that our budget projections for the year 2000 we're going to approach a hundred million in charity care - pharmacy being one of those. So the Clear conclusion to that is that there's an ever increasing demand for charity care and that really should be no surprise to anyone because if you look at the number of uninsured, those are the people that will be moved toward the safety net hospitals, and will probably have an influence on our increased charity demand here.

AB- How long do you think Metrohealth will be able to continue providing low cost drugs? Can you forsee a time when you might have to say, we have to stop?

TW- Yes, I think there's that possibility. You start raising the whole issue of rationing and setting some limits to what you are capable of doing. We have not done that at this point. We would hope that there would be other public policy issues that will give enough relief before that becomes necessary. I think when you listen to the national debate about, first of all, the cost of pharmaceuticals, the escalation of that, and the availability for the new therapies, this is going to be an increasing problem. It's also a problem on the inpatient side, too, for those same patients, as to how you can do that. And obviously one of the things that will hit us, concurrently with that is: With the demand that we have, what is our capacity? Not only from a financial standpoint but just absolute physical? How many beds do we have? Right now we're running at very high occupancies, and it will almost be a self-limiting dynamic in terms of what you're be able to do because you won't have the facilities. What we found Monday is that we certainly don't have the facilities to do twelve hundred prescriptions. There's another story here: one thing I am proud of. The people there really worked hard to meet that demand despite that there were some lines. Our head pharmacists was here until eleven! He personally handled 125 phone prescriptions. So everyone is jumping in. We have people from other department answering the phone, we have nurses that are talking to patients in line, and trying to help them to communicate, so there's been a big improvement.

AB- Could you say how the pharmacy affects the quality of car you're able to give?

ME- Well, obviously, pharmacy is just one component of providing care - whether it's inpatient or outpatient. But it's a critical piece. One of the things that we strive to do is to limit hospital stays to as short a time as is medically necessary. And one of the ways we do that is with an awful lot of home therapy. Having a quality pharmacy service is an imperative for us to be able to do that. That means not only patients having access to the pharmacy but also pharmacists who can fill and dispense medicines accurately, that we can provide the patients the information that they need to take the medicines correctly, and that we're available should a problem arise. So it is entirely wrapped up with the quality of care that we provide.

TW- Our prediction is that in 30 days when our new system is fully operative, to look at it together then to see if we've achieved our goal overall of improving the system. As an organization we hold ourselves to that standard, we really want to improve that and see if our goal has been met, what we need to make sure that it has. We're confident that it will. There's a little piece of y2k in this in that we bought the new system to bring on the timing of this was to make sure that it was y2k compliant and all this. That was one aspect of this. And learning a new system as of January 1.

AB- Is it possible the pharmacy could ever consider bidding out the pharmacy again?

TW- I guess the best answer to that question is that we will continue to try to do whatever's possible to make sure that we have the level of service and the quality of service that our customers deserve - and we want them to have - and will allow us to give the care so we're going to continue to look, just like we do in the rest of the organization. If there's a better way to do what we're doing, we want to be open to look at any way that would improve our service and allow us to do our job better. We think right now that the approach we're taking will do that, given appropriate time. But if it doesn't we'll look for other ways to improve it.

ME- Just to speak to the issue of whether we maintain the service in house or whether we attempt at some point in the future to bid it out again - obviously we want to provide a level of service that we are comfortable with and which is high quality. It should be noted however that when we attempted to bid the pharmacy services in 1999 we had no takers.

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