Financial Risk Relationships and Adoption of Management Strategies in Physician Groups for Self-Administered Injectable Drugs

OBJECTIVE: To consider the extent, nature, and range of risk arrangements between physician groups and health maintenance organizations (HMOs) for self-administered injectable (SAI) drugs; to examine types and frequencies of SAI drug-use management strategies adopted by physician groups; and to explore the relationship between locus and level of financial risk for SAIs and physician group strategy adoption. METHODS: We used a multiple case-study design to select physician groups and their health maintenance organization (HMO) contractual partners in 4 markets in the United States (Northwest, Northeast, Midwest, Southwest). Physician groups in these markets were chosen based on size (e50 physicians) and experience with drug risk (e1 year). Physician groups were asked to identify their 3 major HMO contractual partners in each market. Telephone interviews were conducted from January 2000 to June 2001, with the resulting purposive sample of 37 individuals representing 20 physician groups. RESULTS: We found that the level and locus of SAI financial risk were related to the adoption of management strategies. Physician groups with higher financial risk for SAIs adopted more strategies than lower-risk groups. Groups with SAI financial risk in the medical services capitation (MSC) adopted 9.2 strategies per group. In contrast, groups with SAI financial risk in the pharmacy-risk budget (PRB) averaged 1.5 strategies per group. Groups with SAI financial risk in both the MSC and PRB fell in-between, averaging 4.5 strategies per group. The most frequently adopted strategy was designing evidenced-based therapeutic guidelines, i.e., protocols based on evidence from the peer-reviewed literature used to guide physicians in the treatment of typically chronic conditions (9 groups, 45% of sample). The second most common strategy involved adapting the existing utilization management system to process SAIs (7 groups, 35%) and the establishment of office procedures for internal authorization (5 groups, 25%). The least frequently used strategies were determining amount paid to out-of-group physician providers (1 group, 5%) and hiring personnel (e.g., pharmacists) in claims or utilization management departments to implement and manage SAI programs (1 group, 5%). We also identified potential factors that increased the likelihood of strategy adoption and that could slow the rate of SAI cost increases. CONCLUSION: Our findings suggest that adoption of SAI drug-use management strategies may be more likely to occur when there is a minimum level of risk for SAI drug costs. Likewise, both the adoption of strategies and the opportunity to slow the rate of SAI cost increases may be more likely to occur when 3 additional factors are present: a contractual environment conducive to controlling SAI drug costs, the ability to implement SAI drug-use management strategies, and power in negotiations with drug manufacturers to reduce SAI prices. A sustainable and affordable SAI financial risk management program maximizing these factors while minimizing the financial burden for patients will require collaboration among all stakeholders, payers, providers, drug manufacturers, and patients.

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