Hoping to set an industry standard for electronic transmission of prescriptions and to reduce prescribing errors, the nation's three largest pharmacy benefits managers will invest $20 million each in a new venture to link pharmacies with PBMs, insurance companies and physicians. Medical interests support the effort in general, but some worry that it may make it easier for drug manufacturers to learn doctors' prescribing patterns.
AdvancePCS of Irving, Texas, St. Louis-based Express Scripts and Merck-Medco of Franklin Lakes, N.J., announced plans Feb. 22 to form RxHub, an electronic exchange for prescription management. The three firms expect to have the joint venture operational by early next year.
They have invited other PBMs to join the venture or at least sign on to RxHub's standards, a move cheered by medical safety advocates.
"From a safety standpoint, I hope more people get involved in this," says Matt Grissinger, a fellow at the Huntington Valley, Pa.-based Institute of Safe Medication Practices.
"There's no single way for docs to write prescriptions electronically for all patients," Express Scripts Chairman and CEO Barrett Toan says. "What we're doing is creating a universal standard to connect the (data transmission) devices in physician offices with the PBMs."
The PBMs estimate that prescription errors cost patients $1 billion a year. And because more than 95% of all prescriptions were written by hand last year, pharmacists had to make more than 150 million calls to physicians to verify information, according to the ISMP.
RxHub intends to transmit clean prescriptions directly from a doctor to the patient's pharmacy of choice and let the pharmacy know exactly what the patient's PBM will cover.
The partners say that their system will conform to the National Council for Prescription Drug Programs' telecommunication standards picked by HHS for compliance with the Health Insurance Portability and Accountability Act.
The PBMs say RxHub will meet all HIPAA privacy requirements.
"Certainly everything that is a protected data element today around both patient confidentiality and information that isn't directly relevant to the prescription itself would be continued to be treated as proprietary and confidential," says Steven Cohan, Merck-Medco's senior vice president for business development.
Still, the current NCPDP protocol for electronic medical records includes an optional database field reserved for ICD-9 diagnostic codes.
Physicians rarely indicate a diagnosis on a paper prescription, but the presence of an ICD-9 code on an electronic prescription could open up a Pandora's box.
Drug companies covet ICD-9 coding as a way to track prescribing patterns and off-label usage of medications, and the PBMs involved all have ties to pharmaceutical interests; for example, Merck-Medco is a wholly owned subsidiary of pharmaceutical giant Merck & Co.
The PBMs insist that RxHub will not compromise the data. "The hub will not store information," says Agnes Rey-Giraud, vice president and general manager of Express Scripts' e-business division. "Each of the different constituents will have a commitment to their clients and the people they contract with in terms of privacy. And we hope we will not influence in any way these different commitments."
So far, others are willing to give the PBMs the benefit of the doubt. "Overall the concept is good, and it's going to be beneficial to healthcare," says Mitch Gold, vice president of business development for Data Critical Corp., a Seattle-based medical information technology firm.
But Gold cautions: "This isn't a short-term trek. This is going to be a long-term journey."