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PHM 411 > Unit 2 review > Flashcards

Unit 2 review Flashcards

1
Q

Define the basic economic concept of demand and the relationship outlined in the law of demand.

A

-Limited resources influence consumer demand for health care
-Decrease in price=increase in quantity demanded

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2
Q

change in quantity demanded

A

Assumes price of good/service changes

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3
Q

change in demand

A

Assumes price of good/service held constant, horizontal shift on graph, represents healthcare system

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4
Q

Explain the factors that lead to a change in demand for a product or service

A

price of good, income of consumers, number of consumers in the market, attitude, tastea, and preferences of consumers, consumer expectations of future prices and income.

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5
Q

Define the basic economic concept of elasticity of demand

A

Measures how responsive is the reaction to a price change

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6
Q

factors that impact the elasticity of demand for a product or service

A

availability of substitutes(more substitutes=more elastic), price relative to income(more expensive=more elastic), necessity v. luxury, short run v. long run

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7
Q

Define the basic economic concept of supply and the relationship outlined in the law of supply.

A

-Similar to demand, but from supplier perspective
-Increase in price=increase in quantity supplied

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8
Q

True or false: a change is quantity supplied is caused by demand not a change in supply.

A

False. Caused by change in supply. Independent of demand

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9
Q

Explain the factors that lead to a change in supply for a product or service

A

techniques of production, number of sellers in market, resource costs, price of related goods, seller expectations with respect to future prices and income

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10
Q

perfect competition

A

Many buyers and sellers – no concentration of power
Freedom of entry and exit – enter/leave at will
Standardized products – many interchangeable substitutes
Full and free information – complete knowledge of prices, quality
No collusion – each organization acts independently
Standard structure

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11
Q

monopolistic competition

A

relies on product differentiation

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12
Q

monopoly

A

one seller(brand name)

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13
Q

oligopoly

A

multiple sellers of similiar products(antihistamines)

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14
Q

Explain how the economics of health care is different from the economics of other industries.

A

-Numbers of buyers and sellers
-Entry and exit (licensing, accreditation, etc.)
-Variation in products, services, and quality
-Full and free information
-Inelastic demand
-Universal demand
-Unpredictability of illness
-Health care as a “right”
-Supplier-induced demand
-Third-party insurance and -patient-induced demand

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15
Q

Describe how the economic performance of the healthcare system could be improved.

A

patients aware of costs, provider feedback about performance, reimbursement incentives/penalties, balancing cost and value

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16
Q

list price

A

estimated average price for a drug, publically disclosed, price before discounts and rebates

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17
Q

net price

A

actual price paid for drug, closely gaurded secret, price after discounts and rebates

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18
Q

Estimated price

A

payer estimate of net prices

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19
Q

drug pricing terms used by manufacturers

A

Wholesale acquisition cost(WAC), set the list price

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20
Q

the factors that influence manufacturer drug prices, and the rationale for those prices.

A

Production costs
Research and development costs
Taxes and other costs
Profits

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21
Q

factors influencing how much wholesalers pay for drugs

A

Discounts based on volume, prompt payment, sale of short dated products, performance metrics

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22
Q

associated pricing terms with wholesalers

A

average manufacturer price(AMP): WAC-X%

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23
Q

factors influencing how much pharmacies pay for drugs

A

Size of discount tied to market power
Chain v. independent pharmacy
Group purchasing organizations(GPOs)
Combined purchasing power for small pharmacies
Profit tied to buying/selling prices

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24
Q

associated pricing terms for pharmacies

A

-Average wholesale price(AWP) WAC+20%
-Actual Acquisition cost(AAC) AWP-17%

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25
Q

Describe the factors influencing how much patients pay for drugs without insurance and associated pricing terms.

A

U&C price=drug ingredient cost(product)+cost of dispensing(service)+net profit

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26
Q

Describe the ways in which PBMs interact with other parts of the healthcare system to impact drug prices

A

-PBMs interact with manufacturers: rebates and formulary placement
-Offer reimbursement to pharmacies
-Employers / health plans contract with PBMs to manage drug benefits

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27
Q

Describe the structure and goals of contracts between pharmacies and PBMs

A

Stipulate services be provided by pharmacies in exchange for specific reimbursement, Specify roles and responsibilities,
Goals: increase patient access, quality, and safety, lower costs, increase prescription volume and profits

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28
Q

Describe PBM drug reimbursement

A

Estimated acquisition cost(EAC): AWP-20%

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29
Q

PBM cost containment approaches

A

prevent overpayment for generic drugs, Federal upper limit(FUL): Medicaid, requires 3+ drugs on market, Maximum allowable cost(MAC): differs for each payer

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30
Q

payer cost

A

Payer cost=product cost+service cost-patient cost sharing

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31
Q

Ingredient cost:

A

best guess by PBM of what it cost pharmacy to acquire drug, may over/underestimate

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32
Q

total pharmacy payment

A

Total payment: product cost+cost of service+ net profit

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33
Q

Describe the “lesser of” provision in pharmacy contracts and how it impacts pharmacy reimbursement.

A

Contracts state PBM will pay the lowest of 3 approaches:EAC+dispensing fee, MAC+dispensing fee, Pharmacy’s usual and customary charge

34
Q

how pharmacies can lower cost of dispensing.

A

Automation, Fewer pharmacist and more techs, Increase Rx volume, Shorter operating hours

35
Q

Discuss how Wisconsin Medicaid reimburses pharmacies for prescription drugs.

A

-Requires all pharmacies to provide AAC
-Used to determine “National Average Drug Acquisition Cost” or NADAC
-Reimburse [NADAC or WAC+0% or MAC]+ dispensing fee

36
Q

Describe factors impacting the size of rebates, and the implications of drug rebates for manufacturers, PBMs, and employers/health plans.

A

-Ability to move market share
-Number of competitors(more competitors=more rebates)
-Preferred status on formulary
-OBRA ‘90 law-mandated Medicaid rebates

37
Q

Discuss issues associated with PBM profits and compare how spread pricing and transparent business models affect PBM profitability.

A

-Spread pricing-profits a PBM makes from buying drugs and reselling them
-Rebates are major source of profit
-Shift towards transparent business models

38
Q

Describe pharmacist roles within drug information

A

Timely and accurate research and evaluation of literature including: comprehending study designs, statistical analyses, study limitations, applicability, and clinical significance

39
Q

Describe pharmacist roles within formulary managment

A

Work on a P&T Committee made up of physicians, nurses, practitioners and pharmacists to create a formulary that benefits patients

40
Q

pharmacist role in utilization management

A

A set of techniques used in the PBM industry to encourage safe, effective, and economical medication use

41
Q

pharmacist role is client managment

A

-Management and coordination of the clinical relationship with existing clients
-Works to improve the quality of care while controlling or decreasing overall health care costs

42
Q

Industry relations and contracting

A

Responsible for establishing, maintaining, and enhancing effective relationships with pharmaceutical manufacturers and negotiating contracts with respect to rebates and discounts

43
Q

provider services

A

The development, monitoring, and maintenance of retail, mail and specialty pharmacy networks. This may include broad, limited, preferred, and/or client custom networks

44
Q

Population Health

A

Design, implement and monitor outcomes of population-based clinical programs

45
Q

Government Programs

A

Current Medicare topics of interest: medication assisted treatment (MAT), safe use of opioids,medication adherence, and compounding

46
Q

Identify PBM cost control strategies and summarize their goals.

A

pharmacy payments, generic substitution, rebate, formularies, disease management programs, mail service programs, Drug utilization review(DUR)

47
Q

Identify unique pharmacist roles within a specialty pharmacy.

A

-Quality and accreditation
-Manufacturer involvement
-Clinical programs

48
Q

Describe characteristics of a specialty pharmacy product.

A

No standard definition, cost and complex

49
Q

filling a specialty drug prescription

A

-Provider orders prescription
-Benefits investigation
-Prior authorization and appeals
-Financial assistance
-Pharmacist evaluation
-Consult rom pharmacist
-Delivery
-Pharmacist clinical management

50
Q

Describe access barriers to specialty drugs and ways to address these barriers.

A

Completion of prior authorization and appeals, Connecting patients with additional resources

51
Q

Limited distribution drug model

A

-Manufacturer sells meds directly to pharmacy and has more control over terms and prices
-Only pharmacies within limited network can even purchase drug
-Pharmacies outside of LDD network cannot access the drug

52
Q

Specialty contract distribution model

A

Medication only available through one wholesaler

53
Q

Tradition distribution model

A

-Multiple wholesalers
-Pharmacies can ‘shop’ around for best price
-No restriction on access

54
Q

Socialized medicine:

A

-Healthcare is financed and provided by the government
-Government employs healthcare practitioners and owns healthcare facilities
-UK, Cuba

55
Q

National Health Insurance Model

A

-Single-payer, government-run, universal health insurance program
-Care mostly delivered by non-profit private hospitals
-Healthcare services financed by the program with the negotiated reimbursement
-Canada, South Korea, Taiwan

56
Q

Decentralized National Health Program

A

-Required to get health insurance provided by non-profit, nongovernmental health insurance funds or private health insurance
-No direct financing/delivery of care by government
-Ex: Germany, Japan, Switzerland

57
Q

UK Health care system

A

National Health Service(NHS), financing through taxation, universal access, 10% drugs have a copay, capped at $104 pounds/year, long wait list so some get private insurance, medical tourism

58
Q

Canada Healthcare System

A

Medicare, hospitals are non-profit are reimbursed with Medicare, long wait lists, 2/3 have private insurance to supplement

59
Q

Germany healthcare

A

requires everyone to get private health insurance, funded by taxes on income, government helps set prices of services and drugs

60
Q

Compare the health care systems of other countries with the United States.

A

The US has less government involvement, Bigger role of private sector, more spending, less distribution of resources, and lots of disparities in access to care and health outcomes.

61
Q

Compare drug policies in other countries with the United States.

A

Drug policy in other countries:
Government negotiates prices for drugs on behalf of the country
Government decides coverage of drugs (national formulary)
Government determines patient cost-sharing (if any)
↑ negotiating power = ↓ prices

62
Q

Describe the differences between laws and regulations.

A

Legislative (laws): Statutes give guidance, define authority
Administrative (rules): Regulations give detail and outline enforcement within delegated authority

63
Q

Describe a medication shortage

A

a supply issue that affects how the pharmacy prepares or dispenses a drug product or influences patient care when prescribers must use an alternative agent

64
Q

common causes of shortages

A

Manufacturing issues
delays/capacity
Raw materials
Increased demand
Loss of manufacturing
Discontinuation

65
Q

proposed ways to address shortages

A

-Federal: Food and Drug Administration Safety & Innovation Act (FDASIA) requires companies to notify FDA when manufacturing changes could lead to supply disruption
-State: Price gouging prevention laws
-Professional: Mitigating Drug Product Shortages Policy Position (1905)

66
Q

Pharmacy and Medically Underserved Areas Enhancement Act

A

Pharmacist can be reimbursed for services provided in medically underserved areas

67
Q

Equitable Community Access to Pharmacy Services Act.

A

-Expands Medicare coverage to permanently include services provided by a pharmacist, including incidental services and supplies, related to testing, drug regimens, and vaccines for COVID-19, influenza, and certain other illnesses
-Reimbursement authorized for 85% (or 100% during a declared emergency) of the applicable amount

68
Q

Capitation(prospective)

A

Prepayment:fixed amount regardless of services provided, Incentive to decrease utilization costs and length of hospitalization stay

69
Q

Per diem(prospective)

A

Paid flat rate per day regardless of actual cost, Incentive to decrease utilization cost similar to capitation, no incentive to control length of stay

70
Q

Diagnosis-related groups(DRGs)(prospective

A

Paid flat fee for each diagnosis or disease state, Incentive to decrease utilization cost and length of stay, Used by Medicare A and Medicaid for hospital care

71
Q

Value-Based Purchasing (VBP) Program

A

Created by the Affordable Care Act for Medicare patients, incenticve payment program for hospitals, reward quality care

72
Q

Describe characteristics and give examples of emerging integrated, interdisciplinary care approaches

A

-Accountable Care organization (ACO)
-Patient centered Medical Home (PCMH)
-based on incentive based payments

73
Q

Describe the implications of prospective and non-prospective payment systems on the use of prescription drugs and pharmacy services.

A

prospective-pharmacy is a cost center, balance between lowest cost and patient outcomes
non-prospective: pharmacy is a revenue generator

74
Q

Describe how clinical pharmacist services are billed and reimbursed

A

Most insurance plans will not pay for clinical pharmacist services, WPQC is a group paying pharmacist for MTM and CMR/s services on FFS basis

75
Q

Describe and discuss the need for health care reform in the United States.

A

cost, access, quality

76
Q

Describe how the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) impacted the healthcare system.

A

Largest overhaul of Medicare since 1965
Created medicare part D and current Part C plans
E-perscribing
Health Savings Accounts

77
Q

health savings accounts (HSAs)

A

-Must be enrolled in a HDHP
-Funds roll over and accumulate year to year
-Good for young, healthy people

78
Q

flexible spending accounts (FSAs)

A

-Can be used with any type of insurance
-Funds lost at end of year
-Need accurate budgeting
-Plans may allow 2.5 grace period or carry over up to $640(2024)

79
Q

Describe the implications of high deductible health plans.

A

Catastrophic coverage
Low premiums, high deductibles

80
Q

Describe the major provisions in the Affordable Care Act (ACA)

A

-Affected almost every aspect of healthcare:Pre-existing conditions, Limits on coverage, Premium increases, 10 essential health benefits, Preventive care at no cost
-Modified/repealed: Insurance mandate
subsidies/expansion, Health insurance marketplace, Oral contraceptives

81
Q

Describe how the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) impacted the healthcare system.

A

changed the way medicare reimbures doctors, focus on quality and value

82
Q

Describe the prescription drug provisions in the Inflation Reduction Act of 2022.

A

impacts medicare part D, federal govn. negoitites price, rebates if price raises faster than inflation, insulin cap, cost sharing vaccines

PHM 411 (28 decks)

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