The VA National Formulary generated controversy, which motivated congressional scrutiny and a directive to the VA to commission this report reviewing the experience with the National Formulary and formulary system. This Institute of Medicine committee was pleased to assist the Congress with this review, in part because the committee saw in the VHA example an opportunity to understand and anticipate problems that all publicly funded programs are likely to encounter in this new age of pharmaceuticals. The Congress asked the committee to review the restrictiveness of the National Formulary, its impact on the costs and quality of care in the VHA, and how it compared to formularies and drug management practices in the private sector and in other public programs, especially Medicaid. Detailed in the pages that follow, the committee's findings and conclusions on these questions are, the committee believes, highly instructive, though not always in the ways that we anticipated.
- DESCRIPTION AND ANALYSIS OF THE VA National Formulary
- Copyright
- Preface
- REVIEWERS
- Contents
- Executive Summary
- SUMMARY AND CONCLUSIONS
- Restrictiveness
- Cost
- Quality
- Comparisons
- Recommendations
- 1 Introduction
- LEGISLATIVE AND EXECUTIVE BRANCH HISTORY
- History of the IOM Study
- The IOM Committee
- FORMULARIES AND FORMULARY SYSTEMS: HISTORY AND DEFINITIONS
- Modern Formularies and Formulary Systems
- Economic Focus of Formularies
- Types of Formularies and Their Restrictiveness
- Formulary Control
- GENERIC SUBSTITUTION
- THERAPEUTIC INTERCHANGE
- LOCAL VA FACILITY AND VISN FORMULARIES AND THE NATIONAL FORMULARY
- History of VA Formulary Management Prior to the National Formulary
- Reorganization of the VA
- Impact of the VA Fixed Budget
- Establishing the VA National Formulary
- Evolution of the National Formulary
- Medical Staff Input
- National Formulary Classes
- Formulary Relationship to Pharmaceutical Companies
- REPORT OUTLINE
- 2 Is the VA National Formulary Overly Restrictive and Does It Prevent Physicians from Meeting the Health Care Needs of…
- BACKGROUND
- Elements of Restrictiveness
- SIZE AND COVERAGE OF THE NATIONAL FORMULARY
- Adequacy of the VA National Formulary
- Closed and Preferred Drug Classes in the VA
- Restrictiveness of Class Closure
- Excluded Drugs and Other Limits
- National Formulary Effects on Drug Use
- ADDITION OF NEW DRUGS AND FORMULARY REAPPRAISAL
- National Policy Regarding New Drugs
- VISN Addition of New FDA Approvals
- Evaluation of the VA Process for Adding New FDA-Approved Priority Drugs
- Addition of Existing Drugs by the VA
- Addition of Newly Approved or Existing Drugs in Other Health Care Systems
- THE NONFORMULARY PROCESS
- THERAPEUTIC INTERCHANGE
- OTC DRUG COVERAGE, GENERIC SUBSTITUTION, AND PHYSICIAN SATISFACTION
- Generic Substitution
- Veterans' Complaints
- VA Physician Satisfaction
- SUMMARY
- 3 What Are the Potential Costs to VA Health Care Associated with the National Formulary for Drugs?
- INTRODUCTION
- THE VHA NATIONAL FORMULARY AS IT AFFECTS COSTS
- Background
- Basic Economics of the VA National Formulary
- Features of the National Formulary
- VISN Implementation Issues
- Other Influences on VHA Pharmaceutical Spending
- ANALYTICAL FRAMEWORK
- DATA
- EMPIRICAL METHODS
- RESULTS OF THE IOM COMMITTEE ANALYSIS OF COST EFFECTS
- How Have the VHA and the Veteran User Population Changed During the Study Period?
- How Has the National Formulary Affected Prices for Closed and Preferred Classes?
- How Has the National Formulary Affected Prescribing Patterns Within the Closed and Preferred Classes?
- How Has the National Formulary Affected Pharmaceutical Spending per Veteran User for Closed and Preferred Classes?
- IS THERE EVIDENCE THAT CHANGES IN FORMULARY POLICY HAVE RESULTED IN INCREASED UTILIZATION ELSEWHERE IN THE VHA SYSTEM?
- Exploration of Changes in Hospital Discharges per VHA User
- COSTS ASSOCIATED WITH IMPLEMENTING AND MANAGING THE NATIONAL FORMULARY
- Estimated National Formulary Savings
- CONCLUSIONS
- 4 What Are the Effects of the National Formulary and Related Policies on Quality of Care?
- BACKGROUND INFORMATION
- QUALITY OF CARE IN THE VHA AND EFFECTS OF THE NATIONAL FORMULARY
- PHARMACY, CLINICAL, AND FORMULARY PROGRAM ELEMENTS RELEVANT TO QUALITY OF CARE
- P&T COMMITTEES
- THE VA PBM COMPLEX
- Additions to, and Quality of, the National Formulary
- POLICIES AND PROCEDURES
- Drug Class Reviews
- Clinical Guidelines and Drug Utilization Reviews
- The Nonformulary Process
- Therapeutic Interchange, Policy, and Results
- EFFECTS OF THE NATIONAL FORMULARY ON USE OF DRUGS BY THE VA
- ADVERSE DRUG EVENTS
- Changes in Inpatient Hospital Discharges Associated with the National Formulary
- PATIENT COMPLAINTS—ADVOCATE, VETERANS OF FOREIGN WARS, AND SURVEY DATA
- PHYSICIAN COMPLAINTS AND SURVEY DATA
- SUMMARY STATEMENT
- 5 How Does the VA National Formulary Compare with Private Insurance Formularies for Drugs and Devices and with Other…
- INTRODUCTION
- IMPLEMENTATION OF DRUG MANAGEMENT STRATEGIES IN MANAGED CARE
- IMPACT OF STATE LEGISLATION ON MCO PRACTICE
- PUBLIC-SECTOR PROGRAMS
- Medicaid
- Medicaid Fee for Service
- Medicaid Prescription Drug Benefit
- Medicaid Controls Prior Approval and Formulary Systems
- Comparison to the VA
- Effects of Medicaid Formularies and Formulary Systems
- Effects of Medicaid Prior Approval Systems
- Effects of Medicaid Prescription Limits
- Medicaid Managed Care: Background
- Drug Benefit in Medicaid Managed Care
- DEPARTMENT OF DEFENSE
- Health Care System and Pharmacy Benefit
- DOD Formulary and Formulary System
- GENERAL COMMENTS ON COMPARISONS
- 6 The VA National Formulary and Veterans Health Care
- INTRODUCTION
- BACKGROUND AND CONTEXT
- THE VETERANS HEALTH ADMINISTRATION
- RESTRICTIVENESS
- COSTS
- QUALITY
- COMPARISONS
- References
- Acronyms
- APPENDIX A Interim Report of the Committee on VA Pharmacy Formulary Analysis to the Department of Veterans Affairs and the…
- APPENDIX B Academy of Managed Care Pharmacy's Managed Care Formulary and Pharmacy Benefit Design Survey
- AMCP MANAGED CARE FORMULARY AND PHARMACY BENEFIT DESIGN SURVEY (JANUARY 2000)
- The P&T Committee
- Exclusion of Coverage
- Closed Formularies
- Open–Preferred Formularies
- Open–Passive Formularies
- Other Types of Formularies
- Drug Restrictions
- Generic Drugs
- Access to Nonformulary Drugs
- Cost-Containment Measures
- Addition of New FDA-Approved Drugs
- Appeals Process
- Continuation of Care
- APPENDIX C Additional Cost Information
- APPENDIX D Glossary
- APPENDIX E Drug Classes and Drug Index
- Committee Biographies
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