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Appropriate Drug Use and Prescription Drug Programs

Using Information Technologies


Dan Mendelson, Managing Director, Health Strategies Consultancy, LLC, Washington DC.

New technologies present a wide range of options for health care providers and payers to both encourage appropriate use of pharmaceuticals and contain costs. Mendelson explained how new information technologies can improve the ability of program administrators and practitioners to get the right information to the right people at the right time, both prospectively and retrospectively.

He also described recent advancements such as computerized physician order entry (CPOE) systems and handheld devices for physicians, while identifying key issues related to the cost of financing such technologies and the policy implications of supporting them.

Mendelson explained the "value proposition" for implementing automated prescribing systems. He emphasized that the complexity of the health care delivery system lends itself to creating medical errors, and that adverse drug events (ADEs) occur for a variety of reasons such as:

  • Poor drug nomenclature.
  • Poor drug packaging.
  • Volume of prescriptions.
  • Misinterpreted handwritten prescriptions.
  • Stressed medical staffs and budgets.

As a result, the Institute of Medicine claims that information technology must play a central role in the redesign of a safe health care system. Mendelson explained that currently the variety of pharmacy benefit management firms and their formularies that providers regularly contend with can create inefficient lines of communication and lead to tremendous administrative costs. These problems might be alleviated with the implementation of new technologies that include the capabilities to:

  • Deal with more than one formulary quickly and easily.
  • Check instantaneously for drug-drug interactions.
  • Simplify the channel between doctors and physicians.
  • Raise physicians' awareness of the costs of certain prescriptions during the prescribing process.

One such automated technology is a computerized physician order entry (CPOE) system, an electronic prescribing system that intercepts errors by providing:

  • Prompts to warn against drug interactions, allergies, and overdose.
  • Current information about new drugs.
  • Drug-specific information to eliminate confusion over similarly named drugs.
  • Automated locks that prevent the administration of wrong drugs.

CPOE applications can also be tailored to check dosages against age, height, and body surface area, barcode utilization for administering correct orders, and automate dispensing. Mendelson pointed out that currently less than 5 percent of civilian hospitals have CPOE systems and less than 1 percent of physicians write prescriptions electronically. However, due to the increasing complexity and fragmentation of the health system, the need to implement such systems is growing.

Mendelson used Boston's Brigham and Women's Hospital (BWH) to illustrate an example of an inpatient CPOE system with proven success. A study by David Bates revealed that at BWH:

  • CPOE reduced overall error rates by 55 percent (10.7 to 4.9 per 1,000 patient days).
  • Serious medical errors fell by 88 percent.
  • Preventable ADEs increased stays by 4.6 days.
  • Estimated savings per year ranged from $5-10 million.
  • Unnecessary variation in care was reduced and resulted in a 94-percent compliance rate when a change in drug of choice was made using computerized decision support.

However, BWH's CPOE implementation met challenges that may be prohibitive for other institutions in terms of cost, organization, and cultural barriers. BWH's initial investment cost $1.9 million and requires $500,000 per year for maintenance. In addition, BWH realized that CPOE implementation is more than just an information technology project, and requires organizational change with great commitment and a cultural shift.

Outpatient applications for CPOE are also effective yet differ slightly from the inpatient applications. While capable of similar functionality, outpatient applications have significant adoption challenges related to determining who pays for both the hardware and the software to interface effectively with other providers, hospitals, insurers, and pharmacies and to provide accurate patient history and formulary information.

Policy obstacles exist because the transmission of prescriptions from physicians to pharmacies is regulated differently in different States. Currently it is a challenge for outpatient CPOE vendors to obtain adequate funding because the clientele comprising their market is still an undefined group. Despite these challenges, Mendelson highlighted the Connecticare Health Pilot that gave handheld devices to 100 physicians. Of those surveyed, 80 percent of physicians said the program was valuable or very valuable, however the question remains as to how to quantify the program's worth.

Mendelson also discussed the use and application of automated medication dispensing systems. In pharmacies these systems function by automating manual dispensing of drugs. They interface with the pharmacy computer system and can deliver filled and labeled vials at the rate of 100 per hour. The system can also print and apply prescription and auxiliary labels, or deliver uncapped vials for final inspection and on-screen drug image verification. In personal homes, such systems lock medications and are programmed to release specific drugs at specific times. Automating dispensing systems are particularly relevant to nursing homes, as generally nursing home residents receive seven or eight drugs (The Merck Manual), and every dollar spent on drugs in skilled nursing facilities equates to $1.33 consumed in the treatment of adverse drug events, or $3.6 billion in avoidable ADEs. (Bootman, 1997).

Mendelson concluded by saying that medical errors create a quality imperative in hospitals and other settings to look at ways to incorporate automated systems to make the system safer. Also, automated systems have many benefits in that some have the potential to counterbalance physician concerns about workflow and initial costs by substantially reducing administrative burdens and costs.


Bates DW, et al. Effect of computerized physician order entry and a team intervention on prevention of serious medication errors. JAMA 1998;280(15):1311-6.

Beers MH , Berkow R. Drug therapy in the elderly. The Merck Manual. Whitehouse Station, NJ: Merck Research Laboratories. 1999.

Bootman JL, Harrison DL, Cox E. The health care cost of drug-related morbidity and mortality in nursing facilities. Arch Intern Med 1997;157(18):2089-96.

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