Down to the wire on health care reform: stakes high for pharmaceutical industry sectors.

each year. Medicaid reimbursement to pharmacies for generic drugs, which was tightened like a vise by a 2005 law, may be loosened, but not by much. Pharmacists, as a result of providing medication therapy management (MTM) services to patients, will get new recognition and payment for their role in prescription cost containment. Yet given that only 10% to 15% or so of health care costs are prescription-related, Congress will squeeze physician and hospital costs even harder. F. Randy Vogenberg, Principal at the Institute for Integrated Healthcare in Sharon, Massachusetts, says that drug use in hospitals will be a major focus in the legislation. Congress is almost sure to endorse, at a minimum, pilot programs that provide incentives to hospitals for cutting down on the number of readmissions of patients who have a second or third bout of the same illness or who pick up an infection in the hospital and have to be rehospitalized. Related to that will be a push for “global” payments, in which “accountable care organizations”—such as the Mayo Clinic—are paid one fee for managing a patient’s illness from start to finish. Both of these concepts place hospital P&T committees in the spotlight. “They will have to rethink the value proposition of what a product will bring to the table,” Mr. Vogenberg states. Today, P&T committees in hospitals might meet 10 times per year for an hour at a time. Being a committee member is a voluntary position; no one gets paid for serving. In developing the formulary, the 20 or so committee members generally rubberstamp recommendations made by a subcommittee or the hospital pharmacy. Mr. Vogenberg adds, “In the future, the P&T committees will have more of a responsibility to look at a broader issue, not just the particular drugs on the formulary, but how those drugs are used. The utilization review component will be much more important.” It is impossible to say at this moment—in late September— whether the House and Senate will agree on a compromise health reform package. The final details, if an agreement is reached, will be hammered together in what is likely to be a fractious conference committee free-for-all that will probably take place in October or November, after the House and Senate pass their separate bills. However, there is substantial political support from many groups—some of them frequent antagonists in Washington, such as business and labor—that want a bill that can change the way in which health care is delivered in the U.S., reduce costs, improve the effectiveness of that care, and cover many of the 46 million Americans who are without insurance. Individuals whose employers don’t provide insurance will have to get insurance from state-run exchanges or cooperatives (these are different concepts), and Congress is still making deciThe author is a freelance writer based in Washington, DC, who covers issues inside the Beltway.