Your browser doesn't support JavaScript. Please upgrade to a modern browser or enable JavaScript in your existing browser.
Skip Navigation U.S. Department of Health and Human Services
Agency for Healthcare Research Quality
Archive print banner

This information is for reference purposes only. It was current when produced and may now be outdated. Archive material is no longer maintained, and some links may not work. Persons with disabilities having difficulty accessing this information should contact us at: Let us know the nature of the problem, the Web address of what you want, and your contact information.

Please go to for current information.

Appropriate Drug Use and Prescription Drug Programs: Adding Value by Improving Quality

A Workshop Brief for State and Local Policymakers

The goal of this workshop was to provide State and local officials in the legislative and executive branches of government with a forum for discussing issues and strategies addressing appropriate use of prescription drugs. The workshop was co-sponsored by AHRQ's User Liaison Program (ULP), the U.S. Pharmacopeia Public Policy Center, and the Centers for Medicare and Medicaid Services (CMS) of the U.S. Department of Health and Human Services (HHS). It was held in Denver, Colorado, November 5-7, 2001.

About the Workshop Sponsor.


At the completion of this workshop, participants were expected to be better able to understand:

  • Current trends related to prescription drugs and how they may contribute to future policy decisions.
  • Research on prescription drugs related to quality, costs, effectiveness, and patient safety.
  • General components of a prescription drug benefit program and how these programs have traditionally been administered in the public and private sectors.
  • How tools, systems, or practices that public purchasers and providers use can ensure the appropriate use of prescription drugs and improve patient safety (e.g., drug utilization review; prior authorization; formularies; computerized prescribing systems; etc.).
  • The current evidence and promising practices related to utilizing these tools and systems.

Session Summaries

Trends and Implications

To make informed policy decisions related to the problem of inappropriate drug use it is important for policymakers to understand the current trends in the pharmaceutical market and the major factors that are contributing to rising drug expenditures. A complex set of factors drive rising drug spending, including increased use, the invention of new drugs, rising drug prices, and even drug advertising. This session discussed current trends in the pharmaceutical market and their relevance for policymakers.

Value of Appropriate Use

Appropriate use of pharmaceuticals encompasses more than preventing medication errors and adverse drug reactions. This session began to answer the question, "What is the appropriate use of pharmaceuticals?" by examining the terms "appropriate" or "rational" drug use. It also highlighted key research that attempts to quantify both the medical and financial impacts of inappropriate use of pharmaceuticals.

Anatomy of Benefit Programs

The design of a prescription drug program can dramatically impact how patients receive drugs, what drugs they and their physicians choose, how the drugs are paid for, and ultimately, whether drugs are selected and used appropriately. This session explored the basic elements of a prescription drug insurance benefit. It also explored the differences in how public and private insurers have traditionally administered prescription drug benefits and explained the basic roles of physicians/prescribers, pharmacists, patients, health plans, and drug manufacturers. It also explained the unique rules Medicaid programs must follow in administering prescription drug benefits.

Perspectives and Strategies

Prescription drug programs in the public and private sectors have used varying strategies and mechanisms for managing pharmacy benefits to ensure the appropriate use of pharmaceuticals. This session featured experienced experts from a State Medicaid program, a public employee benefits program, a State pharmacy assistance program, and a private pharmacy benefits management company (PBM). It highlighted the commonalities and differences in the mix of approaches and policy levers that these programs have used to ensure that drugs are used appropriately in their patient populations.

Tools for Appropriate Use

A considerable body of research exists that evaluates the impact of several prominent tools used to promote the appropriate use of pharmaceuticals. The purpose of this session was to describe the research-based strengths and weaknesses of various tools for improving appropriate prescription drug use, such as drug utilization review (DUR), disease management, formularies, prior authorization, and pharmacy benefit managers. In discussing the use of these various tools, panelists also addressed ways in which State officials might use these research findings to improve the efficiency and impact of their own prescription drug benefit programs.

Using Information Technologies

Advancements in computers and information technologies are revolutionizing the delivery of health care services, especially the use of prescription drugs, by presenting health care providers and payers a range of options for encouraging the appropriate use of pharmaceuticals while containing costs. This session described some of the latest computer technology applications and implications for government prescription drug programs. It also described recent advancements such as computerized physician order entry (CPOE) systems and automated dispensing devices. Key issues related to the cost of financing such technologies and the policy implications of supporting them were also discussed.

Program Design

This session presented examples of how purchasers can design drug benefits programs that incorporate the latest tools for promoting the appropriate use of pharmaceuticals. It highlighted North Carolina's AccessCare Inc. Network to demonstrate how appropriate-use strategies can be used to meet the needs of the elderly and children with special needs in public programs. It also highlighted relevant research that demonstrates how quality indicators can be used effectively in program design. In addition, the session addressed the roles of various stakeholders of the program and explained how policymakers can apply research findings toward designing prescription drug benefit programs.

Evaluation of Benefit Programs

Evaluating pharmacy programs can be a complex undertaking. To effectively evaluate a program's effectiveness, it is important to determine the most appropriate design for a given intervention and to collect the relevant data in the process. Different types of evaluative studies, such as time-trend analyses and longitudinal models, have different strengths and yield different results. It is important to use the correct design to gain an accurate assessment of the impact of an intervention. An effective evaluation design can help a State assess whether or not an intervention was successful in terms of decreasing costs and improving quality.

AHRQ's User Liaison Program (ULP) disseminates health services research findings in easily understandable and usable formats through interactive workshops. Workshops and other support are planned to meet the needs of Federal, State, and local policymakers, and other health services research users, such as purchasers, administrators, and health plans.

Top of Page

                  Contents         Next Section Next Section

The information on this page is archived and provided for reference purposes only.

AHRQ Advancing Excellence in Health Care