Our unique process sets us apart
Evidence-based medication selection
At Kaiser Permanente, we begin with teams of expert physicians and clinical pharmacists who collaborate to evaluate each medication’s clinical value and safety. To conduct evaluations, we look to the latest evidence from published clinical trials along with other clinical materials such as meeting abstracts, FDA reviews, and advisory committee briefing documents. At times, information from our own electronic health record system (real-world evidence) is reviewed to determine how well different medications perform among our members. Conducting these evaluations is the first step in developing cutting-edge, evidence-based formularies with a process led by clinicians.
How is Kaiser Permanente different from other health plans when it comes to prescription drugs?
Beginning with this rigorous approach ensures physicians and other clinicians can prescribe medications that work best for our patients.
Approach to drug purchasing
Once we have conducted the initial evaluations, Kaiser Permanente’s pharmacy contracting team works directly with drug manufacturers to negotiate the lowest possible drug prices. Our approach to drug purchasing is straightforward and avoids most of the complexities and opaqueness present in other traditional health plan–pharmacy benefit manager relationships, which are clouded by rebate-driven formulary decisions. Through our contracting efforts, we achieve up-front discounts when possible, providing our members the best possible value for their dollar. Our pharmacy contracting team actively seeks to negotiate contracts prior to generic drug availability to ensure optimal access for our members to new generic and biosimilar drugs.
Formulary implementation
Kaiser Permanente’s formulary (list of covered medications) is developed by our Pharmacy and Therapeutics committees, which use a team-based approach to optimize treatment, safety, and efficiency. These physicians and pharmacists meet regularly to update the formulary as new information becomes available. Kaiser Permanente’s integrated model gives us the unique ability to leverage the pharmaceutical supply chain, drug formulary management, and pharmacy benefit design to control drug costs. At Kaiser Permanente, we have a value-based, integrated model of care that combines both a health plan and a care delivery system. As a result, we have an innovative approach to prescription drug coverage and purchasing for our members.
Prescribing practices
Our clinicians consistently prescribe according to our formulary guidelines with these factors in mind:
- Trust in our evidence-driven, clinician led approach: Our prescribers trust our formularies because they know they are grounded in clinical evidence and built in partnership with their expert colleagues. The evaluation of drugs for any particular disease or condition is led by both pharmacists and specialists in our medical groups who focus on treating that disease or condition.
- Value-based integrated system: Unlike other health plans, we’re not trying to coordinate providers across a vast array of disparate systems. Our providers are members of a single community and we use a common clinical infrastructure and electronic health record system, which makes it easier to share reliable information and evidence about drugs across our system.
- Systemwide contracts: We manage many functions typically performed by pharmacy managers internally for our members, including formulary maintenance and negotiation of contracted drug prices. As a provider, a pharmacy, and a health plan rolled into one, our incentives are aligned to try to purchase drugs at the lowest possible net cost. Because we bear the entire cost of a drug within our integrated system, we are disincentivized from purchasing high-priced drugs, regardless of any rebate amount. To achieve discounts on drugs, we leverage our purchasing power and unique ability to move market share among competing therapies that results from the confidence our clinicians have in our evidence-based formularies.
- Detailing restrictions: In contrast to many other organizations, at Kaiser Permanente our medical groups have chosen to significantly restrict direct-to-clinician marketing by pharmaceutical sales representatives. Instead, pharmacist drug education coordinators actively provide our prescribers with unbiased, up-to-date information on medications. Additionally, prescribers can reach out to our pharmacists to ask specific questions about a medication.
- Pharmacy excellence: Pharmacists have access to the full patient electronic health record system as well as to the prescriber if questions or concerns arise, improving the safety of our medication use processes. Our pharmacists actively track medication adherence for patients with chronic conditions and regularly communicate with them on how to take their medications most effectively. Due in part to multi-source contracts and our integrated system’s ability to be nimble, we are in a strong position to respond to drug shortages and facilitate access for our members and the medications they need.
Continuous evaluation
Throughout this process, we remain committed to the ongoing evaluation of medication safety and efficacy. Our entire organization uses the same electronic health record system, so we have access to nationwide data regarding safety and effectiveness for all the drugs we prescribe. Access to longitudinal data provides us the ability to monitor safety, compare the effectiveness of different treatment options, and routinely update best practices for our clinicians in near real time. Because our members stay with Kaiser Permanente for longer than average, we can focus on prevention and invest in continuous evaluation practices.