[Med-privacy] electronic prescribing

[peter marshall]

  Medication managers, drug stores merge networks

By MATTHEW PERRONE, AP Business WriterTue Jul 1

The drug store and pharmacy benefit management industries on Tuesday=20
will announce a combination of their information systems in order to=20
boost electronic prescribing by physicians.

The merger combines the RxHub network, operated by CVS Caremark Corp.,=20=

Express Scripts Inc. and MedcoHealth Solutions Inc., with Surescripts,=20=

which is run by the drug store industry's two main trade groups.

Executives for the two industries said the transaction, which closed=20
Monday, will make electronic prescribing more convenient and efficient=20=

for physicians.

"This merger sets aside historic economic and political differences to=20=

do what is necessary to advance paperless prescribing and the secure=20
exchange of critical information," said John Driscoll, president for=20
new markets with MedcoHealth Solutions.

The effort comes as both Washington politicians and the corporate=20
executives ramp up efforts to encourage electronic prescribing, which=20
takes the place of handwritten notes. The technology has been touted as=20=

a way to avoid medication errors and reduce health care costs, but has=20=

not been embraced by many doctors.

Younger doctors, who shop and socialize online, already use the=20
technology in medical school. But older physicians have yet to embrace=20=

it, arguing that the upfront costs of going paperless fall on their=20
shoulders, while the immediate savings go to pharmacy benefits managers=20=

that are paid to keep prescription costs low.

Only about 2 percent of all medicines dispensed last year were=20
prescribed electronically, according to Surescripts.

RxHub and Surescripts were founded separately in 2001. RxHub stores=20
data on more than 200 million insured patients and provides physicians=20=

with information on which medicines are covered by their insurance.=20
Surescripts is an electronic exchange that lets doctors see patients'=20
medication history and send prescriptions to pharmacies nationwide.

The new company is a novel combination since pharmacy benefit managers=20=

and retail pharmacies have traditionally been competitors, said Dr.=20
John Halamka, chief information officer at Harvard Medical School.=20
Whereas pharmacy benefit managers often encourage patients to order=20
prescriptions through the mail, retailers do their business by=20
dispensing medications directly to patients.

"By coming together like this I think they realized they could reduce=20
costs for everyone," said Halamka. "If you get more electronic=20
prescribing then there is less paper, less manual costs =97 everyone=20
wins."

The combined company, named Surescripts-RxHub, will be managed by a=20
six-person board of directors which includes executives from Walgreen=20
Co., CVS Caremark and Express Scripts, among others. Under the deal,=20
Surescripts and RxHub each retain a 50 percent share of the company,=20
which is not publicly traded.

Improving the information technology supporting the nation's health=20
care system has become a rallying cry on Capitol Hill and the campaign=20=

trail in recent years, but with few concrete results. Analysts say=20
electronic prescribing may be able to break that trend thanks to its=20
broad appeal within the Bush administration, Democrats in Congress and=20=

the private sector.

Congress is expected to approve a Medicare bill in coming weeks that=20
will include incentives and penalties to encourage doctors to prescribe=20=

electronically. Under the legislation, doctors in the government's=20
Medicare program would receive a 2 percent payment bonus next year if=20
they use the technology. Those who don't adopt it by 2011 would see=20
their pay cut 1 percent, growing to 2 percent by 2013.

With 86 percent of U.S. doctors participating in Medicare, pressure=20
from the government program for seniors could go a long way in=20
persuading doctors to stop handwriting prescriptions.

Unions including the AFL-CIO and large employers like Wal-Mart Stores=20
Inc. have all lobbied in support of electronic prescribing due to its=20
potential to reduce health care costs.

The software used for online prescribing allows doctors to see detailed=20=

lists of medication options, including cheaper, generic drugs. When=20
doctors switch to less-expensive medications, both patients and=20
employers save money.

Copyright =A9 2008 The Associated Press.=20=