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Johns Hopkins Pediatric

Formulary Management Committee Saves Costs and Promotes Integration

June 30, 2016

Five hospitals. Five formularies. Five data sets to manage. Not a recipe for efficiency.

And think of physicians who practice at multiple hospitals in the health system — what if a drug they want to prescribe is not on a particular hospital’s formulary?

The Formulary Management Committee came together in fall 2014 to create a common formulary for the five adult hospitals in the health system. The formulary for each hospital currently contains up to 1,700 medications, each with different strengths and dosage forms.

Attaining a single formulary remains a couple of years away, but the benefits of the committee’s work have already been substantial, says Redonda G. Miller, president of The Johns Hopkins Hospital:

  • Johns Hopkins Medicine saves information technology costs by eliminating the need for five distinct databases while taking advantage of the Epic build and rollout. Epic houses the common formulary as it is being put together.
  • A single formulary boosts Johns Hopkins Medicine’s purchasing power with the drug manufacturers whose products remain in use.
  • When two drugs are equally effective, the committee, after careful review, will choose the less expensive alternative for the formulary, allowing resources to be devoted to other aspects of patient care.
  • And, finally, says Miller: “We’re making it easier for physicians who see patients at several hospitals in the system — they don’t have to remember differences in the formularies of the hospitals where they practice.”

Gary Roggin and Brent Petty co-chair the committee; Roggin is a gastroenterologist who practices at Suburban Hospital and chairs the Suburban Hospital Pharmacy and Therapeutics Committee, and Petty is chair of the Pharmacy and Therapeutics Committee for Johns Hopkins Medicine. Meeting once a month at Howard County General Hospital, the approximately 25-member committee consists of physicians, pharmacists and nurses from the academic and community hospitals, as well as representatives from finance and regulatory matters.

Celia Proctor, assistant director of formulary management and integration for the health system, coordinates and manages the committee’s work and the work of the four specialty panels, which perform reviews of new formulary requests and specific drug classes. One, for example, focuses on antibiotics.

“Class reviews allow us to look at clinical efficacy, safety and relative costs to determine which medications to add to the health system formulary,” says Roggin. “For instance, there were about eight ACE inhibitors in use in the system; we narrowed that down to three.”

This year, about 25 drug class reviews are to be completed. More than 230 clinicians have been involved in the committee’s efforts to date.

The committee establishes rules for the use of particularly expensive medications, such as intravenous acetaminophen, which was in wide use in the system for pain control after surgery. It was thought to reduce length of stay and opioid use. But the evidence suggested that it was not more effective than oral acetaminophen.

Some members of the committee argued it should remain on the formulary, however. After a review of the documented evidence, says Roggin, the committee decided that one use per patient would be permitted postoperatively.

That one change saved the Johns Hopkins Health System almost $2.1 million in 2015. “The annual cost for this drug is now less than $100,000,” says Daniel Ashby, chief pharmacy officer for the Johns Hopkins Health System. “The savings are significant, as such costs cannot be passed on to the insurer or patient.”

“Nonstocking” is another way the system saves money. A very expensive oncology agent may be on the formulary, but because it is never used at a hospital, that hospital does not stock it and thus saves the cost of purchasing it.

“The cooperation among the different hospitals has been superb,” says Miller.

At a Glance

  • The formulary management committee is working toward a single formulary for the five adult hospitals in the health system.
  • A single formulary will save money without compromising patient care in any way.
  • Representatives from the academic and community hospitals are on the committee, and more than 230 clinicians have been involved in the committee’s work to date.

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