Formulary Management And Decision Making
Expert-defined terms from the Certificate in Pharmacy Benefit Management course at London School of Planning and Management. Free to read, free to share, paired with a professional course.
Academic Detailing #
Academic detailing is a process where pharmacists or other healthcare professionals provide educational sessions to prescribers to promote rational use of medications and adherence to formulary decisions. This process involves face-to-face interactions, webinars, or other educational materials to influence prescribing behaviors. Related terms include counter-detailing and academic detailing programs.
Active Ingredient #
The active ingredient is the component of a medication that produces the desired therapeutic effect. It is the chemical entity responsible for the medication's mechanism of action. In formulary management, the active ingredient is a crucial factor in evaluating the efficacy and safety of a medication. For example, acetaminophen is the active ingredient in Tylenol, which is used to treat pain and reduce fever.
Adherence #
Adherence refers to the extent to which a patient takes their medications as prescribed by their healthcare provider. Adherence is a critical factor in achieving optimal health outcomes and minimizing adverse effects. Formulary decisions can influence adherence by limiting or restricting access to certain medications. For instance, a formulary that excludes a particular brand-name medication may reduce adherence if patients are required to switch to a generic or alternative medication.
Adverse Event #
An adverse event is an unintended or harmful effect of a medication or medical intervention. Adverse events can be serious or non-serious and may require medical attention. In formulary management, adverse events are a critical factor in evaluating the safety of a medication and making informed decisions about its inclusion or exclusion from a formulary. For example, a medication with a high risk of serious adverse events, such as bleeding or allergic reactions, may be excluded from a formulary or restricted to use in specific clinical situations.
Alternative Medication #
An alternative medication is a medication that can be used as a substitute for another medication. In formulary management, alternative medications are evaluated based on their efficacy, safety, and cost-effectiveness compared to the original medication. For instance, a formulary may include a generic version of a medication as an alternative to a brand-name medication.
Benefit Design #
Benefit design refers to the structure and organization of a health insurance plan or pharmacy benefit program. It includes the scope of coverage, copayments, coinsurance, and deductibles. In formulary management, benefit design is a critical factor in determining the accessibility and affordability of medications for patients. For example, a benefit design that includes a high copayment for non-preferred medications may discourage patients from using those medications.
Biologic Medication #
A biologic medication is a type of medication that is derived from living organisms, such as proteins, antibodies, or genes. Biologic medications are often used to treat complex or chronic conditions, such as cancer, rheumatoid arthritis, or multiple sclerosis. In formulary management, biologic medications are evaluated based on their efficacy, safety, and cost-effectiveness compared to other treatment options.
Biosimilar Medication #
A biosimilar medication is a type of biologic medication that is highly similar to an existing biologic medication. Biosimilar medications are approved by regulatory agencies based on their comparability to the reference product in terms of quality, safety, and efficacy. In formulary management, biosimilar medications are evaluated as potential alternatives to brand-name biologic medications.
Brand #
Name Medication: A brand-name medication is a medication that is marketed and sold under a proprietary name by a pharmaceutical company. Brand-name medications are often more expensive than generic medications and may have patent protection that prevents other companies from manufacturing or selling the same medication. In formulary management, brand-name medications are evaluated based on their efficacy, safety, and cost-effectiveness compared to other treatment options.
Clinical Decision Support #
Clinical decision support refers to the use of technology or other tools to assist healthcare providers in making informed decisions about patient care. In formulary management, clinical decision support systems can help identify appropriate medication options and detect potential adverse events or interactions. For example, a clinical decision support system may alert a prescriber to a potential interaction between two medications or suggest alternative medications based on a patient's medical history and current medications.
Co #
Payment: A co-payment is a fixed amount that a patient pays for a medication or medical service. In formulary management, co-payments are used to influence patient behavior and encourage the use of preferred medications. For example, a formulary may have a lower co-payment for generic medications compared to brand-name medications.
Coinsurance #
Coinsurance is a percentage of the cost of a medication or medical service that a patient pays. In formulary management, coinsurance is used to influence patient behavior and encourage the use of cost-effective medications. For example, a formulary may have a higher coinsurance rate for non-preferred medications compared to preferred medications.
Comorbidities #
Comorbidities refer to the presence of one or more additional health conditions in a patient with a primary condition. In formulary management, comorbidities are a critical factor in evaluating the efficacy and safety of a medication and making informed decisions about its inclusion or exclusion from a formulary. For example, a medication that is effective for treating diabetes may not be appropriate for patients with kidney disease due to the potential for adverse events.
Contracting #
Contracting refers to the process of negotiating and agreeing to terms and conditions with pharmaceutical manufacturers, wholesalers, or other stakeholders to purchase or provide medications or services. In formulary management, contracting is used to secure discounts or rebates on medications and to ensure the availability of medications at a reasonable cost.
Cost #
Effectiveness: Cost-effectiveness refers to the relationship between the cost of a medication or intervention and its effectiveness in achieving a particular health outcome. In formulary management, cost-effectiveness is a critical factor in evaluating the
Cost #
Sharing: Cost-sharing refers to the practice of requiring patients to pay a portion of the cost of a medication or medical service. In formulary management, cost-sharing is used to influence patient behavior and encourage the use of cost-effective medications. For example, a formulary may have a higher co-payment or coinsurance rate for non-preferred medications compared to preferred medications.
Decision Support #
Decision support refers to the use of tools or systems to assist healthcare providers in making informed decisions about patient care. In formulary management, decision support systems can help identify appropriate medication options and detect potential adverse events or interactions. For example, a decision support system may alert a prescriber to a potential interaction between two medications or suggest alternative medications based on a patient's medical history and current medications.
Deductible #
A deductible is the amount that a patient must pay out-of-pocket before their health insurance plan begins to pay for medications or medical services. In formulary management, deductibles are used to influence patient behavior and encourage the use of cost-effective medications. For example, a formulary may have a higher deductible for non-preferred medications compared to preferred medications.
Disease Management #
Disease management refers to the process of coordinating and managing care for patients with chronic or complex conditions. In formulary management, disease management is a critical factor in evaluating the efficacy and safety of a medication and making informed decisions about its inclusion or exclusion from a formulary. For example, a medication that is effective for treating diabetes may be included in a formulary as part of a disease management program for diabetes.
Drug #
Drug Interaction: A drug-drug interaction occurs when two or more medications are taken together and interact in a way that can affect the efficacy or safety of one or both medications. In formulary management, drug-drug interactions are a critical factor in evaluating the safety of a medication and making informed decisions about its inclusion or exclusion from a formulary. For example, a medication that is known to interact with other medications may be excluded from a formulary or restricted to use in specific clinical situations.
Drug #
Use Evaluation: Drug-use evaluation refers to the process of reviewing and assessing the use of medications in a particular population or setting. In formulary management, drug-use evaluation is used to identify areas for improvement in medication use and to inform decisions about formulary composition and management. For example, a drug-use evaluation may identify opportunities to reduce adverse events or improve patient outcomes by optimizing medication use.
Efficacy #
Efficacy refers to the ability of a medication or intervention to produce the desired therapeutic effect. In formulary management, efficacy is a critical factor in evaluating the value of a medication and making informed decisions about its inclusion or exclusion from a formulary. For example, a medication that is highly effective for treating a particular condition may be included in a formulary as a preferred option.
Exclusion #
Exclusion refers to the process of removing a medication from a formulary or restricting its use to specific clinical situations. In formulary management, exclusion is used to eliminate medications that are no longer necessary or that have been replaced by newer or better alternatives. For example, a medication that is no longer effective or that has a high risk of adverse events may be excluded from a formulary.
Formulary #
A formulary is a list of medications that are approved for use in a particular health system or insurance plan. In formulary management, the formulary is used to guide prescribing decisions and ensure that patients have access to safe and effective medications. For example, a formulary may include a list of preferred medications for treating a particular condition.
Formulary Management #
Formulary management refers to the process of developing, implementing, and maintaining a formulary. In formulary management, the goal is to ensure that patients have access to safe and effective medications while also managing costs and improving health outcomes. For example, a formulary management program may include activities such as medication use evaluation, drug-use review, and therapeutic interchange.
Generic Medication #
A generic medication is a medication that is equivalent to a brand-name medication but is manufactured and marketed by a different company. In formulary management, generic medications are often preferred over brand-name medications due to their lower cost. For example, a formulary may include a generic version of a medication as a preferred option.
Health Insurance #
Health insurance refers to a type of insurance that covers the cost of medical care, including medications, hospital stays, and other health services. In formulary management, health insurance is a critical factor in determining the accessibility and affordability of medications for patients. For example, a health insurance plan may cover a particular medication but require a high co-payment or coinsurance rate.
Inclusion #
Inclusion refers to the process of adding a medication to a formulary. In formulary management, inclusion is used to expand the range of medication options available to patients and to ensure that patients have access to safe and effective medications. For example, a new medication that is approved by a regulatory agency may be included in a formulary as a preferred option.
Ingredient #
An ingredient is a component of a medication that is responsible for its therapeutic effect. In formulary management, the ingredient is a critical factor in evaluating the efficacy and safety of a medication and making informed decisions about its inclusion or exclusion from a formulary. For example, a medication that contains a particular ingredient may be excluded from a formulary due to concerns about its safety or efficacy.
Labeling #
Labeling refers to the information that is provided on the label of a medication, including its indications, dosage, and warnings. In formulary management, labeling is a critical factor in evaluating the safety and efficacy of a medication and making informed decisions about its inclusion or exclusion from a formulary. For example, a medication with a label that includes a black box warning may be excluded from a formulary due to concerns about its safety.
Managed Care #
Managed care refers to a type of health care delivery system that emphasizes cost-containment and quality improvement. In formulary management, managed care is a critical factor in determining the accessibility and affordability of medications for patients. For example, a managed care organization may use a formulary to guide prescribing decisions and ensure that patients have access to safe and effective medications.
Medication Therapy Management #
Medication therapy management refers to the process of reviewing and optimizing a patient's medication regimen to ensure that it is safe, effective, and cost-effective. In formulary management, medication therapy management is a critical factor in evaluating the efficacy and safety of a medication and making informed decisions about its inclusion or exclusion from a formulary. For example, a medication therapy management program may identify opportunities to reduce adverse events or improve patient outcomes by optimizing medication use.
Medication Use Evaluation #
Medication use evaluation refers to the process of reviewing and assessing the use of medications in a particular population or setting. In formulary management, medication use evaluation is used to identify areas for improvement in medication use and to inform decisions about formulary composition and management. For example, a medication use evaluation may identify opportunities to reduce adverse events or improve patient outcomes by optimizing medication use.
Non #
Formulary Medication: A non-formulary medication is a medication that is not included on a formulary. In formulary management, non-formulary medications may be restricted or require special approval for use.