Patricia L. Hale, MD, PhD, FACP Deputy Director Office of Health Information Technology Transformation New York State Department of Health www.pathalemd.com E-Prescribing Overview: What Works; What Doesn't and How Do We Implement It? HIMSS 09 Physicians' IT Symposium: Closing the Gap: From Implementation to Safety & Quality Saturday, April 4, 3:00 PM - 4:00 PM

E-Prescribing Overview Objectives: Review the positive and negative points of e-Prescribing Discuss implementation of e-Prescribing Examine the challenges of implementation

A Public Health Crisis More than7,000 Americans Die Annually From Preventable Medication Errors Key Points: Back in 2000, the Institute of Medicine came out with a report that astonished everyone. Nearly 100,000 people die each year from medical errors of all kinds, including medication errors. Six years later, the IOM released a report specifically on medication errors and again astonished everyone: According to the IOM, 1.5 million Americans are injured each year and 7,000 die from medication errors. This is simply unacceptable. More than 1.5 Million Americans are Injured Annually by Preventable Medication Errors Source: The Institute of Medicine of the National Academies of Science (IOM). Slide used by permission from SureScripts

The Challenge On Paper! Physicians write as many as The Challenge of “Prescription Hand-offs” Illegible Handwriting Unclear Abbreviations and Doses Verbal Communication Among Physicians, Patients and Pharmacists Physicians write as many as 4 billion prescriptions each year. . . . On Paper! Pastor PN et. al. Chartbook on trends in the health of Americans. Health, United States, 2002. National Center for Health Statistics. 2002. The chain pharmacy industry profile. National Association of Chain Drug Stores. 2001. Agency for Healthcare Research and Quality. MEPS Highlights #11: distribution of health care expenses, 1999. NACDS estimates. 4 out of 5 patients who visit a physician leave with at least one prescription 65% of the US population use a prescription medication each year

The Technology is Available Today…But Not Used Less than 1 in 5 of Physicians Use ePrescribing Only 20% of prescriptions are electronically prescribed with 80% still handwritten Most electronic prescriptions are still sent by FAX Key Points: So it have been six years since the IOM’s first report and the question is have we made any progress? Unfortunately, not enough. With over 3 billion prescriptions written every year; even though we have the technology to make this problem go away, less than 1 in 5 of the nation’s practicing physicians regularly use electronic prescribing While many of the large academic medical groups like our own group at Texas A&M have already adopted electronic prescribing via an electronic health record, 50% of physicians are in small groups with 1 to 10 physicians lack the resources and the time to adopt a standard e-prescribing solution. National savings from universal adoption of electronic prescribing systems could be more than $27 billion Sources: eHealth Initiative, 2004 and: Center for Information Technology Leadership, “The Value of Computerized Provider Order Entry in Ambulatory Settings,” 2003.

Current Challenges Rx Patient safety Between 1.5%-4.0% prescriptions are in error with serious patient risk Adverse drug events occur in 5%-18% of ambulatory patients Cost of errors: >$2 billion / year Quality of care - Compliance 20% of scripts are never filled Patient satisfaction is declining Impact on productivity: Physician practice: 3 hours per day Pharmacy: 4 hours per day (up to 1 call per Rx) Inefficient delivery with paper, fax and phone Rx Illegible handwriting Phone tag and fax tag Patient waiting in the pharmacy

Potential Impact of E-Prescribing on Preventable Adverse Drug Events (ADEs) Pen Print 6% Fax 37% EDI + Decision Support 61% Source: CITL Slide used by permission from SureScripts

What is e-Prescribing ? Ability to create a prescription electronically Ability to receive automated decision support during script creation Medication lists and information Eligibility determination Formulary coverage from insurer including co-pay information Prior authorization clinical decision support including Drug interactions, drug-allergy, etc. Ability to send script electronically to pharmacy using standard transmission messaging (NCPDP SCRIPT, ASC12) Ability to receive/authorize pharmacy initiated-renewals electronically Ability to determine “fill status” as a measure of compliance (medication history) Ability for pharmacy to process electronic script in their system Slide used by permission from SureScripts

Intermediaries for Data Transfer New Rx, refills, renewals, authorizations, change Rx, Prescription history from pharmacies Prescriber eRx Software Pharmacy and PBM eRx Software Eligibility, Formularies, medication claims histories

>150,000 Certified EMR Users Electronic prescribing is under-utilized: Purchasing software does not equal adoption or effective use Practice Size Best estimates for ePrescibing or EMR adoption based on high quality surveys (%) All 24 Small 7-16 Large* 39 Rx InterOp >150,000 Certified EMR Users *”Large” is defined as > 20 physician FTEs in one study with 39% adoption and >50 in two another studies with 47% and 57% adoption respectively. Certified version typically a simple upgrade away Extremely low awareness among install base Sources: Jha et al, Health Affairs, 10/11/06; MGMA, 2005; CDC/NCHS Nat’l Ambulatory Medical Care Survey, 2005; HSC Community Tracking Study, 2006; Forrester, 2003; SureScripts estimates, 2006 10

The Technology is Available Today… But Not Used Less than 1 in 5 of Physicians Use ePrescribing Only 20% of prescriptions are electronically prescribed with 80% still handwritten Most “electronic” prescriptions are still sent by FAX National savings from universal adoption of e-prescribing systems could be more than $27 billion

Market where incentives are most effective Where are we? Tipping Point?? We remain at the tipping point of adoption of clinical systems at the point of care Early adopters are now on board and EMRs are becoming mainstream in large practices Mandates to reach non-adopters Enthusiasts And Early Adoptees Mainstream Market where incentives are most effective eHIT 2.5% 13.5% 34% 34% 16%

So Why Aren’t We All e-Prescribing?

Everyone Benefits – But Not Equally >80% Payors/PBMs: Increased generic/formulary usage, efficiency, Rx compliance and prevention of ADEs (reduced costs) Patients: Increased safety, efficiency and compliance Lower co-pays >20% Providers: Increased efficiency, improved care, patient satisfaction and potential short and long term incentives (pay-for-performance) Pharmacies: Increased efficiency, improved care, improved patient satisfaction

Benefits Include: Discovery of potentially significant drug-drug, drug-allergy or drug-lab interactions; Reduced adverse drug events (ADE), Reduced avoidable emergency department visits or hospital admissions; Eliminated transcription or legibility errors; Availability of a more complete, up-to-date medication list for each patient; Increased practice efficiency (particularly med renewal requests); Increased prescriber efficiency (e.g., fewer call-backs from pharmacies); More effective medication reconciliation across multiple settings of care; Increased patient satisfaction. MGMA 2008 survey:

Proprietary and Confidential E-Prescribing Pilots 16 © RxHub LLC, 2008 Proprietary and Confidential 16

But… Providers are concerned about… Cost of buying, installing and supporting a systemand Return on Investment (ROI) Financial Cost Change Management and Workflow Lack of reimbursement for costs and resources Increased time to use the system = reduced productivity (initially) while struggling to create efficient workflows Challenges of creating a complete, accurate patient medication history from multiple sources Time required to review medications, warnings, alerts and recommendations

But… Providers are concerned about… Limitations preventing use for all prescriptions due DEA restriction from use for controlled medications and other Federal and State rules and regulations Hardware and Software Selection and support Limitations on E-Prescribing System Remote Access Pharmacy, Payer/PBM and Mail Order Connectivity Medication History and Medication Reconciliation System Functionality Gaps Prescribing from Multiple Office Sites or remotely …..Still not considered a routine standard of practice

What are the key elements influencing the business case for clinicians? Business case varies according to: Size of practice Type of practice (primary care vs specialty, mostly new patients, mostly recurrent complex patients, etc) Participation of health plans Participation of local pharmacies Practice setting (large/small, urban/rural) Availability of IT infrastructure and support Stand alone e-prescribing vs EHR Availability of incentives and ability to take advantage of them

Cost: Initial costs include software licensing fees, hardware, network and Internet access and training and technical support Complete cost will also include Temporary decreases in productivity resulting from training and workflow redesign (averaging 2-6months) Practice management, lab and other interfaces Customization for practice specialty and other factors Maintenance of system Upgrades Data conversation (from different PMS or from stand alone e-prescribing system to EHR)

Cost: Stand alone e-Prescribing start up and ongoing cost estimated at $1000 - $3500 per physician per year for software plus hardware etc EMR costs estimated at $20-25,000 initial and $3000 per year per physician for software plus hardware etc Costs are less in urban areas where Internet and IT services are more readily available Large practices can save significantly through cost sharing and increased efficiency of implementation and support by being able to afford dedicated staff

Potential Savings Both stand alone e-prescribing systems and EHRs Increased practice efficiency handling med renewal requests Increased prescriber accuracy resulting in fewer call-backs from pharmacies for legibility issues, drug incompatibility or ineligibility EHRs Decreased chart pulls resulting in less staff time Decreased transcription costs

So – “bottom line”….What is the business case for a large urban practice? Advantages: Financial investment capability Dedicated staff opportunity Leverage with health plans and pharmacies, etc for connectivity Often can leverage other incentive opportunities with health plans, P4P, PQRI etc. Disadvantages: Organizational “buy in” with large potentially diverse physician staff often resulting in “hold outs” and partial implementations Major changes in workflow can be disruptive decreasing productivity making clinician payment strategies etc in need of temporary modifications Significant Initial cost

So – “bottom line”….What is the business case for a small rural practice? Advantages: Organizational “buy in” less of an issue Less total initial investment Disadvantages Difficult to absorb cost including system cost and decreased productivity Can have connectivity issues and difficulty obtaining skilled IT support No leverage with health plans or pharmacies resulting in decreased opportunity for optimum data flow No opportunity for dedicated staff to maximize success or take advantage of other incentives like P4P and PQRI

“Bottom Line” Rural Small 1-5 Docs Primary Care 40/60 3-5+years “ Practice Setting Practice type Prescriptions and Refills/day/ prescriber Stand Alone e-Prescribing* length of time to achieve +ROI*** EMR** approximate length of time to achieve +ROI**** Rural Small 1-5 Docs Primary Care 40/60 3-5+years “ Specialty 20/40 2-5+ years Rural Large 10+ 2-3+ years 2-4+ years 1-3+ years Urban Small 1-5 Primary care Urban Large 10+ 1-2+ years Multispecialty 0.5-2+ years *Stand alone e-Prescribing start up and ongoing cost estimated at $1000 - $3500 per physician per year for software plus hardware etc **EMR initial and ongoing yearly costs estimated at $20-25,000 initial and $3000 per year per physician for software plus hardware etc *** Stand alone e-Prescribing ROI calculated using savings estimates for time savings due to automated refill requests and decreased phone calls resulting in decreased staff time **** EHR ROI calculated using savings estimates from e-Prescribing plus decrease chart pulls (staff time) and decreased transcription costs References: MGMA survey 2007, 2008; Medical Group Management Association, “The cost of administrative complexity,” MGMA Connexion, November/December 2004; “Evidence on the Costs and Benefits of Health Information Technology”. May 2008. Congressional Budget Office

Incentives and Implementation Support Services Where do they fit in?

Overview of Current and Potential Programs to Promote e-Prescribing Economic Incentives Reimbursement for Utilization Incentive programs  disincentive programs MIPPA ARRA Other programs sponsored by Medicaid, private health plans, employers and others Grants, Loans and other funding programs Pay for Performance Malpractice Insurance Premium Reductions Healthcare IT Suppliers discounts, group buying programs, etc Policy Incentives and Programs for Implementation Support Accreditation (JCAHO 2005 Hospitals’ National Patient Safety Goals, others in development) Relaxed STARK regulations CMS DOQ-IT CCHIT certification of “free standing” E-prescribing and ambulatory EHR products …and eventually…Mandates?? CMS has provided over $100 million in funding to state Medicaid programs to help them encourage prescribers to adopt e-prescribing. STARK - At the federal level, regulations released in 2006 now allow free donation of e-prescribing hardware, software, and related services to prescribers by hospitals (to members of their medical staff), by a group practice (to their physician members), and by Medicare Advantage and Medicare Part D Prescription Drug Plans.

Medicare e-Prescribing Incentive Program (MIPPA) Beginning January 1, 2009, Medicare offers physician payment incentives of 2% for using e-prescribing in 2009 and 2010, with this amount declining slightly over the following three years. Those physicians who do not adopt e-prescribing for Medicare by 2012 will start seeing their Medicare payments incrementally reduced, up to 2% annually beginning in 2014. The Secretary of Health and Human Services may make an exemption on a case-by case basis if significant hardship can be demonstrated. Health plans offering Medicare Part D drug programs must begin supporting e-prescribing by May, 2009. The Secretary has the authority to update the codes of the electronic prescribing measure in the future. The legislation refers specifically to the electronic prescribing measure currently in the 2008 Physician Quality Reporting Initiative (PQRI) (measure #125) CCHIT certification is required for both “free standing” e-prescribing and EHR products

E-Prescribing and ARRA The stimulus package includes $36B in health IT funding from the federal government through Appropriations and Incentives Appropriations for Health IT & HIE New Incentives for Adoption New Medicare and Medicaid payment incentives to providers for EHR adoption $20 billion in expected payments through Medicare $14 billion in expected payments through Medicaid ~$34 billion in gross expected outlays, 2011-2016 $2 billion for loans, grants & technical assistance: HIE Planning & Implementation Grants EHR State Loan Fund National Health IT Research Center & Regional Extension Centers Workforce Training New Technology R&D Broadband and Telehealth $4.3 billion for broadband & $2.5 billion for distance learning/ telehealth grants Directs ONC to invest in telehealth infrastructure and tools Directs the new FACA Policy Committee to consider telehealth recommendations Comparative Effectiveness $1.1 billion to HHS for CER Establishes Federal Coordinating Council to assist offices and agencies of the federal government to coordinate the conduct or support of CER and related health services

MIPPA and ARRA Timeline State grant monies begin flowing from HHS to develop technical, privacy, governance and financing frameworks necessary for HIE to take shape...likely 09/10 Medicare and Medicaid ARRA incentive payments begin, presuming HIEs have come online Medicare and Medicaid ARRA incentive payments give way to penalties on providers for failing to adopt HIT MIPPA e-prescribing incentives begins 2009 2010 2011 2012 2013 2014 2015 2016 MIPPA e-Prescribing incentive payments give away to penalties HHS to establish interoperability standards by the end of 2009 to guide HIE development Setting of standards enables the building of HIE infrastructure to practically and usefully implement standards to achieve interoperability to comply with Medicare and Medicaid incentive payment requirements for HIE interoperability

Existing Statutory Definition of “Meaningful Use” of EHRs Three Components Uses EHR in a meaningful manner, which includes electronic prescribing as determined to be appropriate by the HHS Secretary Uses EHR that is “connected in a manner” that provides for the electronic exchange of health information to improve the quality of health care, such as promoting care coordination (in accordance with law and standards applicable to the exchange of information) Submits information on clinical quality measures and other measures as selected and in a form and manner specified by the Secretary

Medicare Health IT Physician Payment Incentives 2011 is first year 2012 is first year 2013 is first year 2014 is first year 2015 is first year 2011 $18,000 2012 $12,000 2013 $8,000 $15,000 2014 $4,000 2015 $2,000 2016 $0 TOTAL $44,000 $42,000 $35,000

>30% of patient population are “needy individuals” Physicians receiving Health IT incentive payments under Medicaid are eligible for up to approximately $64,000 over a five year period if they can demonstrate “meaningful use” of EHRs in their practice. Eligible Provider Percent Match/ Limit Medicaid Share Limit Amount Independent physician 85% net average allowable costs >30% $25,000 for purchase $10,000 for operations/maintenance Max of $64,000 in 5 years Pediatrician >20% $16,667 for purchase, $6,667 for operations/maintenance Max of $51,200 in 5 years Nurse mid-wife Physician Assistant if is lead clinician at RQHC or FQHC >30% of patient population are “needy individuals” By determination of the Secretary Nurse practitioner Hospital owned clinician practice >10% FQHC or RQHC-based practicing physician Third-party sponsoring entity supporting EHR implementation 85% of net allowable costs; third-party entity can keep 5% of funds as pass-through

Predictions and Expectations for ARRA Will nearly double e-Prescribing adoption over MIPPA levels by 2014 and four fold over current levels Saving of over $22 billion in federal costs will offset $19 billion investment Savings of over $56 billion for all payors Will help prevent more than 3.5 million serious medication errors (ADEs) Visante Report 2009

E-prescribing Increases Use of Generics and More Affordable Brands 1-4% reduction in drug spending Pharmacy costs decrease 3-3.5% (Mass eRx Collaborative 2006) 3.3% increase in tier 1 prescribing (Archives Internal Medicine 2008) Generic use increased 4.8% (Sierra/SW Medical 2006) 5.3% reduction drug costs (JMCP 2005) Increased generic use from 65.7-67.6 (HAP/HFMG 2006) 3.7% increased generic prescribing and 10.1% decrease in cost (WellPoint/Wellinx 2005) 11% decrease drug costs and $4.99 decrease per prescription (Ann Fam Med 2004) Increased use of mail in service pharmacy 10% (Drug Benefit Trends 2003) Increased formulary compliance by more than 5% and increased generic use by 7% (Aetna 2008) Visante Report 2009

Increased Medication Adherence Decreased Errors and Hospitalizations Increased adherence, disease management and coordination of care Prevention of ADE related hospitalization, ER and physician visits 0.25% reduction in ER and hospital costs 1% increase use of target drugs for chronic disease and DM management saves 15% in costs (HealthPartners 2007) Hyperlipidemia treatment compliance increased from 50%-90% of benchmark (Project ImPACT 2000) Increased use of ACE-inhibitors for DM+HTN (CITL 2003) 35% decrease preventable ambulatory ADEs with 0.05% decrease hospital, ER and physician costs 30-50% decrease of 8 million ambulatory ADEs (RAND 2005) 9.5% of new prescriptions changed or cancelled due to drug/drug interaction warnings (HAP/HFMG 2006) Visante Report 2009

What You Should Do Consider starting e-prescribing this year to take best advantage of Medicare incentives as they will decrease starting in 2011 and Medicare reimbursement will decrease in 2012 if you are not e-prescribing. Evaluate your patient population to see which of the programs you may qualify for Evaluate your practice setting for decision on what type of product to implement and potential resources for support Be sure any potential vendors for either e-prescribing stand alone products (Medicare MIPPA e-prescribing program only) or EHR products are current year CCHIT certified. Carefully evaluate any potential vendor to be sure they meet other restrictions. For ARRA incentives it will be critical to be sure your vendor is prepared for potential further requirements by HHS and ONC for capabilities to meet the “meaningful use” criteria. Be sure your billing system will be prepared to handle Medicare electronic prescribing specific codes and possible new codes required for ARRA incentives.

Resources for Implementation Support

Resources for Implementation Support Medical Informatics Organizations HIMSS, eHI, AMIA etc Vendor and vendor user groups Surescripts/RxHub Medical Societies State or regional medical societies Medical specialty society chapters IPA or other regional physician groups Hospital or Medical Center State Department of Health or other state agencies Health Plans or Employer groups sponsoring projects Pharmacies and Pharmacist organizations Consultants

References and Resources: Electronic Prescribing for the Medical Practice: Everything You Wanted to Know But Were Afraid to Ask, Patricia L. Hale, PhD, MD, FACP, Editor www.himss.org/bookstore and also the e-Prescribing resource center on the HIMSS web site at: http://www.himss.org/ASP/topics_eprescribing.asp E-Prescribing - A Clinicians Guide - e-Health Initiative 2008 http://www.ehealthinitiative.org/assets/Documents/e-Prescribing_Clinicians_Guide_Final.pdf E-Prescribing and health information technology. Davis, Ronald, 2008. American Medical Association. http://www.ama-assn.org/ama/pub/category/18579.html. National Progress Report on E-Prescribing. 2007. SureScripts. http://www.surescripts.com/pdf/National-Progress-Report-on-EPrescribing-1.pdf. For more information on the Medicare incentive program: PQRI Toolkit - http://www.cms.hhs.gov/PQRI/31_PQRIToolKit.asp and for MIPPA- http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=3200 Evidence on the Costs and Benefits of Health Information Technology. May 2008. Congressional Budget Office, page 17. http://cbo.gov/ftpdocs/91xx/doc9168/05-20-HealthIT.pdf Physicians' Experiences Using Commercial E-Prescribing Systems - Physicians are optimistic about e-prescribing systems but face barriers to their adoption. - by Joy M. Grossman, Anneliese Gerland, Marie C. Reed, and Cheryl Fahlman - Health Affairs April 6, 2008 Free e-prescribing readiness assessment online - http://www.getrxconnected.com/ E-Prescribing: Why the Fuss? Kenneth G. Adler, MD, MMM FAMILY PRACTICE MANAGEMENT Preprint | www.aafp.org/fpm - Surescripts/RxHub - http://www.surescripts.com/get-connected.aspx?ptype=physician Electronic Prescribing: Building, Deploying and Using E-prescribing to Save Lives and Save Money – Center for Health Transformation 2008 HIMSS e-Prescribing Wiki: www.himsseprescribingwiki.pbwiki.com

HIMSS Resources and Initiatives for e-Prescribing The HIMSS E-Prescribing Task Force will continue to develop: “tip sheets” for providers on how to incorporate E-Prescribing solutions into the medical practice HIMSS E-Prescribing interactive Wiki www.himsseprescribingwiki.pbwiki.com Comments and recommendations on e-Prescribing issues such as CCHIT certification, definition of “meaningful use” criteria, etc. HIMSS will leverage Virtual Conference and Exhibition programs to highlight E-Prescribing and provide education updates. Join us!

Web site with further information and links: www.pathalemd.com “We tried dedicating this computer to deciphering our doctors' handwriting." Cartoon by Dave Harbaugh QUESTIONS? pathale@pathalemd.com Web site with further information and links: www.pathalemd.com