Mr. Chairman and Members of the Committee. Good afternoon. Thank you for the opportunity to present to this panel from the pharmacy provider’s perspective implementation issues related to the final rule to the Health Insurance Portability and Accountability Act of 1996. I am Gary Levine, Executive Vice President of Marketing for Medicine Shoppe International, the nation’s largest franchisor of professional community pharmacies with over 1100 pharmacies in 46 states, as well as, over 200 locations in ten international countries. Medicine Shoppe International is based in St. Louis, Missouri and we are a subsidiary of Cardinal Health, a diversified health care company located in Dublin, Ohio.
I am a pharmacist and have been active in the standardization process of pharmacy information over the last ten years through my involvement in the National Council for Prescription Drug Programs (NCPDP), as a previous member of the NCPDP Board of Trustees and as having served as the Chairman of the Drug Utilization Review (DUR) Work Group. This Work Group created the on-line, real-time DUR component of the NCPDP 3.2 Telecommunication Standard, which is in use today throughout the industry. I would like to add that the formation of this DUR Work Group was in response to another very important legislative directive as set forth by the Standards for Drug Utilization Review, outlined in the Omnibus Budget Reconciliation Act of 1990 (OBRA 1990).
The pharmacy community has benefited from NCPDP’s leadership efforts at creating telecommunication standards for interactive on-line prescription related processing between providers, clearing houses/switches, and third party administrators. The adoption of their standards by provider pharmacies and claims processors has resulted in significant efficiencies and cost reductions for all parties involved. The standards developed by NCPDP have facilitated and provided great efficiencies from both a business and health care delivery perspective supporting communications among a large and diverse number of parties within the third party prescription environment. NCPDP’s EDI standards are used and account for upwards of 70% of an average pharmacy’s business transactions and annually amount to billions of on-line prescription health care transactions throughout our industry.
It is my belief that NCPDP’s Telecommunication Standard satisfies the necessary requirements mentioned under HIPAA legislation for pharmacy including:
I feel I can offer a unique vantage point to the committee due to the fact that our pharmacists utilize many different pharmacy computer hardware/software platforms, which mirrors what is seen in the industry at-large. Lack of standardization within our industry would place undue burden on pharmacy providers making it difficult for our software vendors to develop a product that would support our business needs. It would be extremely difficult to develop any type of operational efficiencies and providers and payers alike would not realize the savings.
Adopting a national EDI standard, like NCPDP’s, would greatly decrease the burden on health care providers by eliminating the need for us to continually reprogram our pharmacy computer systems to support multiple formats.
From a patient care standpoint, the benefits of standardization are enormous. Standardization within the industry will enable pertinent patient and medication usage information to be exchanged and captured. It will allow for the screening of potentially dangerous drug conflicts, drug therapy compliance and delivery of disease management. EDI standardization will result in timely and accurate health information supporting the delivery of superior levels of patient care, better interaction among health care providers, and improved health outcomes. Conversely, "uncaptured" or unknown data may create a situation where the patient may be vulnerable to therapeutic conflicts, or omissions without detection.
Additionally, standardization will enable health care providers to document the services and value they contribute to the healthcare system and provide the basis for compensation for our professional services.
With the intent of the HIPPA legislation and work of this committee aimed at improving the Medicare and Medicaid programs by encouraging establishment of standards and requirements to facilitate electronic transmissions of certain health information, the pharmacy community will be prepared to meet this challenge using the NCPDP’s 3.2 Telecommunication Standard which we as an industry already support and have made the investment of time and money to utilize. This approach would also support the administration’s desire to work closer with the private sector in managing public sector programs. Furthermore, this would insure citizens served under the public sector’s programs would receive the same level of care as seen in the private sector.
I would like to share with you a number of the issues and concerns that are being discussed in the pharmacy industry should we be required to move to a new version of telecommunication standard such as going from NCPDP’s version 3.2 to 5.0.
Some of the current and future benefits and advantages of the pharmacy industry moving to the NCPDP’s version 5.0 telecommunication standard are:
In conclusion, I commend the efforts and work of this committee and hope that you have found the information I have provided you with is of value and you will take it into consideration as you assist the Secretary in publishing recommendations and adopting standards. Thank you.