Michael A. Valentino, R.Ph., MHSA

Mr. Chairman, Ranking Member, and members of the Committee: thank you for providing me this opportunity to discuss the Department of Veterans Affairs’ (VA) Pharmacy Benefits Management Services (PBM) program, including our National Formulary and patient safety initiatives.  I am accompanied today by Dr. Chester B. Good, Chair of the VA Medical Advisory Panel and Dr. Paul Tibbits, Deputy Chief Information Officer for Enterprise Development.

Drug therapy is an essential component to quality preventative, curative, and post-operative health care.  Each Veteran enrolled in the VA health care system is eligible to receive prescription medications, over-the-counter medications, and medical and surgical supplies under VA’s comprehensive medical benefits package.  Generally, these pharmaceuticals must be prescribed by a VA provider and are made available via the VA National Formulary process.  In 2008, VA provided approximately 126 million outpatient prescriptions to more than 4.4 million patients.  Our error rate for these prescriptions is very low; less than 1 in every 294,000.  I can confidently say that VA is meeting the pharmaceutical needs of Veterans and that we are striving every day to provide even better care to more of America’s heroes.  My testimony will describe how VA manages pharmacy benefits, the offices and procedures we have in place to ensure Veterans receive safe and quality care, and discuss VA’s National Formulary.  Before concluding, my statement will also provide information on VA’s recently initiated Medication Reconciliation program.

Pharmacy Benefits Management

VA’s Pharmacy Benefits Management (PBM) program works to enhance the clinical outcomes and improve the health of Veterans through the appropriate use of pharmaceuticals.  PBM provides leadership and governance for pharmaceutical activities and professional pharmacy practice in the Veterans Health Administration (VHA) and provides advice and support regarding pharmaceutical issues to Veterans, the Under Secretary for Health, field directors, and pharmacy staff across the system.  The PBM organization consists of six primary specialty areas: the Clinical Informatics section; the Consolidated Mail Outpatient Pharmacy (CMOP) program; Adverse Drug Event Reporting (VA ADERS); Emergency Pharmacy Services (EPS); VA National Formulary (VANF) management; and the VA Center for Medication Safety (VA MedSAFE).

Clinical Informatics

The PBM Clinical Informatics section provides operational oversight to the information systems used by PBM and all pharmacy operations nationwide.  This section plans and establishes the mechanisms by which VA meets general program goals for developing and maintaining a nationwide pharmacy information system – the Pharmacy Re-Engineering (PRE) project.  The VA PRE project being executed by the VA Office of Information and Technology will provide a system to enhance patient safety and encourage the appropriate use of pharmaceuticals by providing streamlined decision-making information to clinical staff in an integrated fashion. 

PRE will provide a flexible technical environment to adjust to and standardize future business conditions while meeting the dynamic needs of the clinical environment.  This system will improve major functionalities, including medication order checks, and will provide prescribers with access to pharmacy knowledge systems that can reduce the potential for adverse drug events, improve efficiency by streamlining order processing and dispensing, reduce inventory costs and improve inventory accountability by providing automated tools to track inventory, and improve patient outcomes through medication utilization reporting and monitoring.  Our focus, as always, is on the Veteran, and this PBM program provides robust decision support and patient safety features.

An example of how PRE will be used to improve operations is demonstrated by the finding of the Department of Veterans Affairs Office of the Inspector General (OIG) report 08-01322-114 dated June 23, 2009, that reviewed VHA’s management of non-controlled drugs.  The report states that, “VHA cannot accurately account for its non-controlled drug inventories because it lacks effective controls and reliable information to do so.”  PRE would assist VA in providing more effective controls.  Until automated inventory management tools are made available through PRE, PBM is addressing the OIG findings by educating field staff and developing guidance specific to OIG’s recommendations.  These interim measures include conducting training on existing requirements, implementing tracking requirements for a sample of high cost/high risk drugs as recommended by OIG, and establishing triggers that warrant focused reviews. 

Consolidated Mail Outpatient Pharmacy

There are seven VA CMOP facilities in the National VA CMOP system.  These facilities are located in Charleston, SC; Dallas, TX; Hines, IL; Leavenworth, KS; Murfreesboro, TN; Chelmsford, MA; and Tucson, AZ.  Together, they interactively provide pharmaceutical support services to VA health care facilities located within defined respective CMOP service areas throughout the United States.  These service areas include the 21 Veterans Integrated Service Networks (VISN) in the VA health care system, the Civilian Health and Medical Program for the Department of Veterans Affairs (CHAMPVA), and the Department of Defense’s (DoD) Naval Medical Center in San Diego, CA.  CMOPs support VA’s health care mission through advanced automated production technologies to dispense and mail prescriptions to eligible Veterans.  This ensures each Veteran receives his or her prescriptions in the most timely, accurate and cost effective manner as possible.  Three of five CMOP performance metrics currently exceed six sigma performance.

VA’s OIG Report 09-00026-143, dated June 10, 2009, reviewed CMOP contract management.  The report found that, “…the National CMOP Office generally complied with Federal and VA acquisition requirements when developing, competing, and monitoring contracts…”  In addition, the OIG auditor’s “…found no evidence of contract overpayments through (their) review of contract charges where documentation was available…”  However, opportunities for improvement exist in a number of areas. 

Until 2007, each CMOP director was responsible for acquiring the services and supplies the CMOP needed.  CMOPs obtained contracting support primarily from local VISNs or VA medical centers.  In 2007, PBM initiated significant changes in CMOP acquisition management.  The National CMOP Office added a contracting and logistics section and centralized contracting.  Each CMOP also hired a logistics manager to strengthen purchasing and inventory controls at the CMOP level.  In December 2008, under the terms of a Memorandum of Understanding (MOU) between PBM and the VA Office of Acquisition and Logistics’ National Acquisition Center (NAC), the National CMOP Office transferred the responsibility and staff for all CMOP contracting to the NAC.

The National CMOP Office has established a management review process for determining CMOP contract needs and evaluating the cost-effectiveness of procurement alternatives.  A process and policy have been issued and the PBM Associate Deputy Chief Consultant for CMOP oversees the process.  The NAC has procedures to assure compliance with the Federal Acquisitions and VA Acquisition Regulations.  The CMOP has increased the number of trained Contracting Officers Technical Representatives (COTRs) from 37 to 75 to provide better contract oversight and ensure contractor performance.  These changes will strengthen CMOP contract management and oversight functions and address findings in the OIG report.

Adverse Drug Event Reporting

Post-marketing drug surveillance is vital to reporting adverse drug events (ADEs) to the Food and Drug Administration (FDA) and VHA.  A cornerstone of this approach is collecting and evaluating reports of ADEs through voluntary reporting by health care professionals.  The safety profile of any drug or pharmaceutical evolves over time as new information is discovered when health care providers offer it to larger populations and sub-groups not previously studied during clinical trials.  Because the electronic medical record is able to link prescription data to clinical outcomes at the patient level, VA is uniquely able to identify and track drug safety issues.  VA has the only national system for electronic reporting of ADEs through its innovative VA Adverse Drug Event Reporting System (VA ADERS).  By analyzing this computerized database, VA is able to identify drug safety signals, assess significance of external drug safety issues in our own patients, and track trends of known drug safety issues almost instantaneously.

Emergency Pharmacy Services

The Emergency Pharmacy Services section is responsible for procuring, storing, and maintaining emergency pharmaceutical and medical or surgical supply items for the VA Pharmaceutical Cache Program.  This section works closely with the VA Office of Public Health and Environmental Hazards’ Emergency Management Strategic Healthcare Group to ensure activation readiness of emergency supplies at VA Medical Center storage sites nationwide.  In addition to maintaining VA’s emergency pharmaceutical capabilities, Emergency Pharmacy Services staff can deploy VA’s Mobile Pharmacies to provide local support in cases of national emergencies, such as a hurricane or other event, or in response to a pandemic disease, under the guidelines of VA’s emergency response plan to ensure continuity of care and supplies to Veterans, no matter the circumstances.

National Formulary Management

In 2009, VA consolidated all of its formularies into a single VA National Formulary (VANF).  The PBM office in Hines, Illinois, is the organizational entity responsible for coordinating the development, maintenance, and implementation of the VANF.  Two groups, the VA Medical Advisory Panel (MAP) and the VISN Pharmacist Executives (VPE) Committee actively manage the VANF.  The MAP provides clinical oversight of the formulary process and is comprised of practicing VA physicians, PBM clinical pharmacists and a physician from DoD.  The VPE Committee is comprised of senior VISN pharmacists who represent each VISN Formulary Committee, a pharmacist from the Indian Health Service, and pharmacists from DoD; it provides both clinical and operational oversight of the formulary process. 

PBM pharmacists support the MAP and VPEs by monitoring the medical literature, scientific research and VA outcomes data to identify evidence that may support adding drugs to or deleting drugs from the VANF and by drafting evidence-based prescribing guidance.  VA develops guidance on the pharmacologic management of common and high-cost diseases and collaborates with clinical experts within the Department to develop or refine guidance when necessary.  VA disseminates the guidance throughout the Department for peer-review prior to being presented to the MAP and VPEs for consideration.  PBM has also developed mechanisms for system-wide collection, analysis, trending and reporting of ADEs.

PBM is also responsible for developing strategies for including a drug class under a National Contract and monitoring trends regarding product utilization with Pharmaceutical Prime Vendor purchases.  Pharmacists from DoD, VA, the Indian Health Service, and the Bureau of Prisons discuss drug classes with potential for joint national contracting.  VA representatives meet with manufacturers for selected drug classes and develop solicitation requirements for use by VA’s NAC.  PBM reviews manufacturer incentive proposals, coordinates price and clinical information as well as contractor performance when considering renewal options for multiyear contracts, and collaborates with VA contracting officers, counsel, acquisition review, and VA field personnel regarding contract issues. 

VA’s Formulary Management Process is stipulated in VHA Handbook 1108.08, “VHA Formulary Management Process,” was last updated on February 26, 2009.  This document provides guidance to the Deputy Under Secretary for Health for Operations and Management, VA’s MAP, the PBM Chief Consultant, VISN Directors, VISN Pharmacist Executives, Facility Directors, Facility Pharmacists, and VA prescribers.

VA Center for Medication Safety (VA MedSAFE)

PBM strives to ensure that Veterans receive the right medication, in the right dose, at the right time.   VA’s efforts for safe medication use are supported by the Computerized Patient Record System (CPRS), electronic medication order entry, automated prescription fulfillment, and the Bar Code Medication Administration (BCMA) system.  The electronic health record (EHR) currently provides automated checks for allergies and possible drug interactions, further improving patient safety and care.  VA’s Center for Medication Safety (VA MedSAFE) is a national, comprehensive pharmaco-vigilance program that emphasizes the safe and appropriate use of medications.  VA MedSAFE utilizes different methods and tools, including passive and active surveillance, to continuously monitor for potential ADEs, including the use of VA ADERS as previously described.

An ADE is defined as an unintended effect of a drug that occurs secondary to drug administration.  In many instances, VA MedSAFE directly and promptly notifies providers across VA’s health care system if patients are at risk through its Risk Reduction efforts.  VA, DoD and FDA have a MOU that allows close collaboration on specific post-marketing surveillance efforts and other drug and vaccine safety projects.  These efforts are conducted through FDA’s newly established Sentinel Initiative and its Office of Surveillance and Epidemiology’s Center for Drug Safety and Epidemiology Research.  Medications and prescriptions are essential to effective health care management, but inaccuracies can have severe repercussions.

Evaluating preventable ADEs, providing interventions to decrease preventable ADEs, and educating the field on best practices reduce the likelihood of ADEs occurring.  By conducting and promoting medication safety projects at the regional and national levels, VA provides safe and effective pharmaceutical care to Veterans.  Through the national roll-up system and data analysis provided by VA MedSAFE, each facility and VISN can benchmark themselves against national trends.  We are unaware of any other health care system with as robust and well-developed a system for tracking, assessing and acting on drug-related safety issues within their patient population.

VA provides consumer medication information sheets on each new and renewed prescription.  VA is highly engaged with patient education on medications, with local medical centers developing policy for teams of clinicians to provide medication education, involving physicians, nurse practitioners, physician assistants, clinical pharmacy specialists, pharmacists, nurses, and other allied health care providers.  Clinical Pharmacy Specialists and clinical pharmacists are key members of the health care team and can assist in optimizing drug therapy and improving medication safety for outpatients.   

Medication Reconciliation, a Joint Commission National Patient Safety Goal, is a process which mitigates the risk of ADEs that occur at transitions of care.  It does this by addressing discrepancies between a patient's accounting of his or her medication use and the medication lists in the medical record every time a medication is dispensed, changed, or added to the medication regiment.  There are many barriers to implementation including interoperability, software development, staff and organization adoption, and a changing Joint Commission National Patient Safety Goal.

The VA Medication Reconciliation Initiative, launched in December 2008, is tasked with facilitating safe, high quality, effective, and above all, Veteran-centered medication reconciliation throughout the VA system.  This multidisciplinary effort includes a VA Medication Reconciliation Toolkit, Educational Video, Facility Monitor, External Peer Review Process, and patient informational Web site called "Medications: Play it Safe!" on the My HealtheVet Web site.  This initiative's workgroups continue to improve patient and staff resources and tools to improve documentation and monitoring of this process. In the coming months, we will continue to bring together VA innovators with those in DoD and the private sector to establish a world-class medication reconciliation program for Veterans and to provide guidance for this challenging endeavor.

Conclusion

Mr. Chairman, VA has developed a remarkable pharmacy benefits management system that provides Veterans safe and effective medication to improve their health care.  Our National Formulary is based on the best clinical research and leverages the size of our patient population and Department to procure medications at a low-cost.  Thank you again for the opportunity to testify.  My colleagues and I are prepared to answer your questions.