Hospital Pharmacy Regulation Report - · PDF file“That would be horrendous,”...

Medford, OR, knows all too well.Rinkle has spent the past severalmonths trying to warn the Centersfor Medicare & Medicaid Services(CMS) and her local congressmanabout the impending problem asthe January 1, 2006, deadline ap-proaches, but to no avail.

“Hospitals should anticipate benefi-ciary phone calls with patient com-plaints,” Rinkle says.

Hospital outpatient departments arein for a rude shock on the first dayof the new Medicare Part D pre-scription drug plan (PDP): patientscomplaining that their outpatientself-administered drugs aren’t cov-ered under the new benefit.

It’s a serious operational and publicrelations issue and one that ValerieRinkle, MPA, revenue cycle direc-tor for Asante Health System in

—INSIDE— Self-administered drugs may causetrouble for outpatient departmentsDespite Part D benefit, hospitals must bill outpatients

Competition a bonusIn addition to having lower premi-ums, several plans won’t chargedeductibles, which will benefit con-sumers in the long run, McClellantold reporters.

“The competition between theseorganizations has resulted in lowercosts than expected,” McClellansaid.

Other highlights include the following:

� Eight companies will offer PDPoptions in every state� Most Medicare-eligible beneficia-

ries will have eight to

Every state except Alaska will havedrug benefit plans charging premi-ums less than $20, and Medicarebeneficiaries will have a choicebetween at least 11 plans when thedrug discount program starts Jan-uary 1, 2006, the Bush administra-tion announced September 23.

Centers for Medicare & MedicaidServices (CMS) Administrator MarkMcClellan released the names ofapproved prescription drug plans(PDP) for 2006 during a confer-ence call September 23.

The plans, organized by state, areonline at www.cms.hhs.gov/map/map.asp.

OPPS troubles

Find out why hospitals struggle to pay the bills underthe Outpatient ProspectivePayment System on p. 5.

Pharmacists helping pharmacists

West Jefferson Medical Centerin Marrero, LA, put out a callfor help after HurricaneKatrina struck. Read about the relief effort on p. 6.

Bar coding help

Are you considering a barcode system at your hospital?Get implementation and training tips on p. 8.

Monitor drugs after ordering

One company offers a solutionto help hospitals check foradverse drug events in realtime. Find out how on p. 10.

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Vol. 3 No. 11

November 2005

Hospital PharmacyRegulation ReportHospital PharmacyRegulation Report

Medicare update

Medicare releases new benefit plans,provides beneficiaries with choices

Don’t miss the enclosed special report with tips

to comply with the JCAHO’smedication reconciliation

National Patient Safety Goal.

Page 2 Hospital Pharmacy Regulation Report—November 2005© 2005 HCPro, Inc.

www.hcpro.com

For permission to reproduce part or all of this newsletter for external distribution or use in educational packets, please contact the Copyright Clearance Center at www.copyright.com or 978/750-8400.

Part D < p. 1

The issue: Self-administered drugs not coveredWhen patients under the new Part D benefit go to thehospital for an emergency room visit or outpatientsurgery, they are usually not allowed to bring pre-scription drugs from home.

“It’s typically viewed as [an unsafe] practice,” Rinklesays. “The hospital doesn’t know if the drug has beenproperly stored, and a hospital cannot use a drug ifit’s not in its labeled prescription bottle.”

To offset this risk, hospitals will in most cases issuethe same medications for a patient from its own stockin response to the physician orders. Medicare doesnot cover these outpatient self-administered drugs,and CMS mandates that hospitals bill patients for themas regular hospital charges.

“We try to tell patients that these drugs are noncover-ed when they’re [outpatients], but there’s no advancebeneficiary notice or waiver requirement,” Rinkle says.“It’s a standard that [the patients are] not covered byMedicare.”

The bill patients receive is almost always a simplestatement that reads “pharmacy” or “prescriptiondrugs”—whichever description the hospital chooses toput on the statement—as well as a quantity associatedwith the number of pills and a total dollar amount.

The problem is that on January 1, patients under thenew Medicare PDP will be under the impression thattheir new drug plan will cover these medications, ex-perts say. And that’s not the case.

“Those drugs will be charged at a full hospital charge,and depending upon what the benefit structure is forthe Part D benefit, there could be a sizable coinsur-ance obligation on the part of the beneficiaries,” saysAndrew Ruskin, an attorney with Vinson and Elkinsin Washington, DC.

And patients have a right to be angry, Rinkle adds.Medicare is supposed to cover outpatient prescriptiondrugs issued by hospitals under the new Part D plan.

The January 28 Federal Register (p. 4268) says:

Part D pharmacy plans can choose to include hos-pital pharmacies in their networks. If a hospitalpharmacy is in the network, then the self-adminis-tered drugs would be covered by that plan . . .Medicare is mandating that all Part D pharmacyplans guarantee out-of-network access to coveredPart D drugs dispensed by hospital and other insti-tution-based pharmacies when [the beneficiaries arepatients].

“But that’s all we know—we don’t know how to helpthe beneficiary get that coverage from the [PDP],” saysRinkle.

Rinkle says most hospitals will assume that these drugsare an out-of-network benefit, which means that thebeneficiary pays the hospital, then takes the invoiceand sends it to the PDP to receive reimbursement.

But here’s the catch: Most hospital invoices read sim-ply “Pharmacy, unit of five, $15,” for example, andwithout detail about the drugs themselves, the PDPwon’t reimburse them.

“We’re not required to have detail,” Rinkle says. “Thatputs the beneficiary in the middle. No one at CMS hasaddressed this.”

Ruskin notes that hospitals might be tempted to waivecharges for self-administered drugs but will not beable to do so. “They don’t want to be accused of hav-ing created inducements that could cause trouble withthe [Office of Inspector General],” he says.

Potential solutions burdensomeCMS may release additional guidance for hospitalsbetween now and the January 1 start date of the new drug benefit. But Rinkle fears this forthcomingguidance may place added administrative burden on hospitals.

Possible fixes may include a requirement that hospitalpharmacies put the national drug code on all patient

Page 3Hospital Pharmacy Regulation Report—November 2005 © 2005 HCPro, Inc.

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statements. It could mean that hospitals must submit aseparate itemized bill with more specific drug detail.

Or worse yet, CMS may require that hospitals registerthe PDP and submit the claim directly to it.

“That would be horrendous,” Rinkle says. “That’sadding another layer of insurance [to] your registrationsystem.”

Packaging a simple fixRinkle says the easiest and most practical fix CMScould make is to simply copy what it does under thePart A benefit of the Inpatient Prospective PaymentSystem: Package the drugs. This would mean hospi-tals would receive no separate reimbursement for self-administered drugs, but Rinkle says it’s a small priceto pay for not creating upheaval in hospital outpatientbilling departments.

“We would rather not get separate payment and nothave to bill and go through any additional administra-tive burden than [make] us change what we do forthe sake of billing the drug plan—particularly whenthe additional reimbursement is likely to be minimaland over-the-counter drugs are still not covered,” shesays.

Most importantly, Rinkle says packaging the drugswould also avoid placing beneficiaries in the middle.

“It would mean a loss of some degree of money, butthat loss is much less than the cost of any possibleadministrative fixes,” she says.

Unfortunately, CMS does not wield the authority tomake such a change. It would have to ask Congressfor a technical amendment to the statute. Thus, aquick fix doesn’t appear to be coming.

“I’m hoping that between now and January 1, Medi-care will have some answer,” Rinkle says. “But it’s sofar down on people’s radar screens. CMS is just tryingto get the basic benefit up and running.”

Beneficiaries might be able to put the issue on theCMS radar.

“There are so many implementation issues that havenot been addressed yet, and this is one of them,”Ruskin adds. “When you get enough beneficiary out-rage, someone might step in and come up with a pol-icy for coordinating benefits.”

Tip: Develop a letter that prints out each time a Medi-care outpatient registers at your facility. Disclose inthe letter that the self-administered drugs won’t becovered.

Rinkle recommends the letter state something to theeffect of the following: “We’re excited that you mayhave elected to enroll in the new Part D MedicarePDP. Please be aware that our hospital is still obligat-ed to bill you directly for prescription and over-the-counter drugs administered to you during your visit toour hospital. You can file an out-of-network claim toyour new PDP to be reimbursed for these drugs.”

Include the toll-free telephone number for generalMedicare PDP information at the bottom for patientquestions. Be prepared to explain to patients that theamount they will be charged might be different fromthe same drugs dispensed by an in-network pharma-cy, Ruskin says.

For more information, call 800/650-6787and mention the source code for the audioconference.

Audioconferences:

November 18—Tips to Implement SBAR (Q111805)

December 8—How to Manage Problem Physicians (MS120805)

December 13—Emergency Management and the JCAHO (A121305)

December 14—Reducing Ventilator-Associated Pneumonia (Q121405)

NOV./DEC. Upcoming events


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Medicare update < p. 1

20 options� Some plans will assist patients financially during

the coverage gap� More than 40 states will offer 100% of Medicare-eli-

gible beneficiaries access to PDPs through a Medi-care Advantage organization� Medicaid recipients will be automatically enrolled

(those plans are listed in the auto-enrolled categoryunder each state)� CMS has received more than 3 million applications

for the low-income subsidy program, inching closeto actuarial projections of 4.5 million� No government fallback plans were needed

Government fallback plans would have been requiredin areas where there were not at least two competingplans available for beneficiaries.

“I don’t expect there to be fallback plans even nextyear,” said Phil Patrick, president of Flemington,NJ–based consulting firm PharmaStrat, after the an-nouncement. “My theory is that organizations havebeen approved, but only a small subset of them willbe aggressive in marketing to seniors. They’ll get thepatients they get during enrollment and maybe a yearfrom now they will have to sell the patients’ coverageto the big players.”

Drug plans could start marketing to seniors October 1,with enrollment slated to begin November 15.

Some plans were approved for multiple designs, butthey may decide to actively market only the plan thatoffers the lowest price and best chance for enrollmentin their state, Patrick said.

One concern that Aileen Harper, executive directorof the Center for Health Care Rights, has is that someMedicare beneficiaries choose not to read informationsent to them, leaving them in the dark about the drugbenefit and the choices available.

“We are pretty concerned that those people might beharder to reach and either . . . may lose the opportu-nity to enroll because they do not know much about

it or might enroll, not realizing how it fits with theirdrug options and may make wrong choices,” Harpersays.

That could place more responsibility on healthcareproviders and the government to reach out to benefi-ciaries, she says.

Costs still an issueThe federal government now estimates the cost overthe first 10 years of the program to be $720 billion,up from the nearly $400 billion price tag the Bushadministration promised when the Medicare reformspassed in December 2003, according to the Associa-ted Press.

Some members of Congress called for delaying thebenefit to help offset recovery costs in the wake ofhurricanes Katrina and Rita, but McClellan rejectedthose pleas.

“This program is going forward on schedule,” saidMcClellan. “Enrollment will begin November 15—onschedule.”

Editor’s note: Information from a September 23 break-ing news e-mail from the newsletter Medicare &Reimbursement Advisor Weekly was used in thisreport. For more information about the newsletter, callcustomer service at 800/650-6787.

The medication-reconciliation deadline looms

Are your staff ready to handle theJCAHO’s medication reconciliationrequirement? If not, HCPro offersyour best hope for meeting the dead-

line. Check out the video “MedicationReconciliation: Communication Strategies for StaffCompliance” and get the essential compliance tipsand strategies. Visit www.hcmarketplace.com formore information.


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Many hospitals already have considerable troublecharging and billing for drugs and biologicals. An anal-ysis of Outpatient Prospective Payment System (OPPS)drug charge data in 2003 revealed that hospitals report-ed drug charges that were less than their acquisitioncost of the drug, says John Carlsen, MHA, a principalat Covance Market Access Services, Inc., in Gaithers-burg, MD.

Carlsen says the reasons for this are threefold:

1. The OPPS payment system is only five years old, asopposed to the diagnosis-related group (DRG) sys-tem (almost 23 years old), which means that someproviders still might be getting used to coding andbilling under the system

2. As compared to the previous cost-based hospitaloutpatient reimbursement system, OPPS is morecomplex in terms of coding and billing, which mayresult in confusion among providers

3. “Charge compression,” in which hospitals mark uphigh-cost items (e.g., high-price drugs and biologi-cals) less than low-cost items, may distort the coststhat Medicare derives from its OPPS charge data

Most pharmacies do not cope well with the intricaciesof OPPS, and much of the blame can be traced topoor software interface and incorrect charging fromthe charge description master (CDM), says ArleneBaril, MS, RHIA, vice president of health informationmanagement and software services for UASI inCincinnati.

“When we do [CDM] review and auditing, we con-stantly find that their units of service are beingcharged incorrectly,” says Baril. “They don’t have cor-rect HCPCS [Healthcare Common Procedure CodingSystem] set up, or they’re billing pass-through drugsas general pharmacy [revenue code 0250], so they’renot getting pass-through payment.”

Most pharmacies use a separate system for dispens-ing their drugs, which is then interfaced through thevarious hospital systems. Baril says the process ofensuring that all billable and dispensed drugs are

Hospital drug billing already problematic

captured and charged appropriately is a struggle formost hospitals.

“Many times it’s an underpayment, not an overpay-ment,” Baril says.

Charging from the CDM is another common source oferror in pharmacies. For example, a CDM coordinatorwill assign a particular J HCPCS code, but the chargingor order entry staff may not realize that the J HCPCScode is per 1,000 units and the dose dispensed was5,000 units.

“You have to adjust your units of service to five, oryou’ll get four [ambulatory payment classification]underpayments if this was a pass-through drug,” Barilsays.

The inability to find good software solutions leadsmany hospitals to underreport or otherwise chargeconservatively for pharmacy, says Marion Kruse,BSN, RN, MBA, director of clinical consulting forOhioHealth Corporation in Columbus. And addingthree new C codes to the mix will make a difficult sit-uation even worse.

“Pharmacy charges are already complex and veryhard to implement, and now we’re going to have tocreate a whole new section of the CDM to accommo-date these changes [if the proposed changes are final-ized],” she says. “To ensure accurate data collection,CMS needs to give more detail to hospitals regardinghow to use the handling charges and allow a reason-able time frame for implementation.”

Contact Managing Editor Matt Bashalany

Telephone: 781/639-1872, Ext. 3726

E-mail:[email protected]

Questions? Comments? Ideas?


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Company provides relief for hurricane-stricken hospital

Basil Thoppil, MSc, PharmD, had worked at WestJefferson Medical Center in Marrero, LA, during everyhurricane since 1986, and as pharmacy director, henever needed to stock more than a 48-hour supply ofmedications to weather the storms.

Five days after Hurricane Katrina struck the Gulf Coaston August 29, his pharmacy had distributed morethan 2,000 prescriptions—not counting ones for thehospital’s 200 or so patients—and his supply wasdwindling.

“This pharmacy became the only source for medica-tion supply for almost seven days,” Thoppil says.“That was probably the most trying time that we hadas a pharmacy. We couldn’t call anyone to bring supplies.”

The lack of power, communication, and functioninghospitals and pharmacies stressed West Jefferson’scapacities, showing the importance of proper plan-ning and creativity to prepare for a potential disasterand get help from vendors and other sources duringan emergency.

Preparing for the stormOnce the power went out and the floodwaters rose,West Jefferson—located nearly 10 miles west of down-town New Orleans—was one of only three area hospi-tals to remain open, and it had the only functioningpharmacy for nearly 90 miles, Thoppil says. The hos-pital remained open because flooding was not severein the area, he says.

Residents who did not evacuate ahead of the stormand emergency workers alike flocked to the hospital,seeking prescription refills. Thoppil’s pharmacy staffmade sure patients could obtain a one-, two-, orsometimes three-day supply of critical medications,such as cardiovascular and respiratory drugs or in-sulin, he says.

Thoppil and his purchasing personnel on August 27sent out an emergency order to his supplier for med-ications such as antibiotics and vaccines. That order

arrived late in the evening on August 28, the nightbefore Katrina hit land, he says.

That was his last shipment for six days.

After the storm hit, the power and phone lines wentout, meaning Thoppil couldn’t contact his vendors,and vice versa. But quick thinking a few days afterthe storm kept the pharmacy from draining its stock.

Ingenuity pays offAll phone numbers with a 504 area code in the NewOrleans region were dead. But a hospital employeediscovered that calling cards would access an outsideline because they went through a toll-free 800 num-ber, Thoppil says.

Staff could go to pay phones at the hospital to placecalls to vendors, Thoppil says.

“I don’t know how that thing worked when all theother phones did not,” Thoppil says of the payphones. “That’s how I got my first contact out to thewholesaler.”

Thoppil was able to place an order, and the first ship-ment showed up under National Guard escort justprior to Labor Day weekend.

Making a call for helpPatients showed up at the hospital describing the pillsthey took or showing pharmacists their empty pre-scription bottles, Thoppil says. Pharmacists used theirbest discretion and judgment when giving out med-ications, and Thoppil used the term “giving” literal-ly—the hospital did not charge walk-up patients forthe drugs.

Pharmacists also provided drugs to the disaster med-ical assistance team that operated out of tents on thehospital campus, Thoppil says.

The need for drugs became so desperate that Thoppilcontacted the Louisiana Board of Pharmacy to alertofficials about the situation at West Jefferson, he says.


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Thoppil says he needed guidance from the state.

“I wanted to let them know we were doing the bestwe could to serve patient needs—not just the inpa-tients, but the community needs,” Thoppil says. “Theboard of pharmacy didn’t quite understand what wasgoing on.”

Prior to Thoppil’s call for help, Medco Health Solu-tions, a pharmacy benefits manager based in FranklinLakes, NJ, contacted the state board of pharmacy withan offer to set up a mobile field pharmacy in the af-fected regions, says Barry Boudreaux, Medco’s phar-macy practices director in Las Vegas.

Rich Palombo, RPh, a member of the National As-sociation of Boards of Pharmacy executive committeeand director of professional practice at Medco’sWillingboro, NJ, pharmacy, contacted the state phar-macy board on Labor Day weekend to see whetherthe need existed for a mobile pharmacy. Palombothen contacted Thoppil after receiving his name fromthe state, he says.

Nearly 250 Medco employees volunteered upon hear-ing about the relief effort, Boudreaux says.

When the pharmacy board told Thoppil about theMedco offer, he jumped at the chance.

“That was a godsend,” Thoppil says. “I had limitedstaff, limited supply. [Medco] basically took over ouroutpatient needs from that point on.”

Reinforcements arriveLouisiana Governor Kathleen Blanco had declared astate of emergency and signed an order allowing out-of-state licensed pharmacists and technicians to oper-ate temporarily in Louisiana, Boudreaux says, whichallowed Medco volunteers to set up shop quickly.

By the weekend of September 9, Medco opened amobile pharmacy in a doublewide trailer on the WestJefferson campus. At first, pharmacists distributed criti-cal medications, including antibiotics, heart medicine,and oral diabetic drugs, Boudreaux says.

Pharmacists were able to get a better handle on pre-

scription needs after filling several prescriptions, andthey had one drug in each pharmacological class aftera few days, Boudreaux says.

Getting to workMedco pharmacists completed health and allergyforms for patients as well as conducting counselingon medications, Palombo says. And although pharma-cists needed to obtain as much information as theycould to help patients, it wasn’t difficult.

“Most of the people [who] came up, although theyhad gone through total devastation, felt comfortablesitting down and talking to people,” Palombo says.“They told us their stories. They thanked us for fillingtheir prescriptions.”

Communication is the keyThe Medco operation at West Jefferson wrapped upon September 21, Thoppil says. Area retail pharmaciesopened, and patient needs began to subside, he says.

The trailers that served as a makeshift pharmacy andhousing for volunteers still remained through the endof September, Thoppil says, although Medco discuss-ed moving them to areas in southwestern Louisiana orTexas that were devastated by Hurricane Rita.

Through everything, Thoppil learned that communica-tion is one of the most critical aspects of disaster plan-ning and receiving help.

“Unless you can communicate your needs, none ofthis is going to happen,” Thoppil says.

Compliance with CMS regulations is just as

important as JCAHO standards.

Quickly and easily navigate The CMS HospitalConditions of Participation and The CMS’

Interpretive Guidelines for the Hospital Conditionsof Participation with easy-to-read hard copies ofthese critical documents. For more information,

call 800/650-6787 and mention source codeMB31560A.


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Case study: Bar code system cuts medication errorsPoints to ponder before going live at your hospital

Although a multidisciplinary team at St. MarysHospital Medical Center in Madison, WI, had beentrying to reduce the organization’s medication errorrate for years, nothing it tried seemed to make muchdifference. More than 60% of the hospital’s medicationerrors occurred at the point of administration.

“We knew if [we] influenced the administration phase,we could definitely impact our medication error rate,”says Wendy Wittwer, RN, BSN, coordinator of thehospital’s bar-code system initiative.

Installing a bar code system looked like the naturalnext step, so in 1999, St. Marys signed on to test andimplement Bridge Medical’s nascent “MedPoint” soft-ware. By fall 2000, the hospital’s pilot units were upand running. Now five adult inpatient units, includingmedical/surgical, intermediate care, and neuro-inten-sive care units use the system—and the hospital isworking to expand it to the rest of the facility.

Benefits have been well worth the effort. Within sixmonths of implementing the software on the firstnursing unit, medication errors had decreased by 59%,says Wittwer.

The American Society of Health-System Pharmacistsnoted that only 4.4% of hospitals use machine-read-able coding to verify the patient’s identity and accur-acy of the drugs administered. As with any newtechnology or system, implementation was—and stillis—a challenge.

For example, St. Marys did not initially dedicateenough staff to the project, says Wittwer. It shouldhave established a lead person from the informationsystems (IS) and pharmacy departments, as well asdedicating someone with a nursing background tocoordinate and train staff on the new system full-time,she says.

Are you considering implementing a bar code systemat your hospital in the future? Consider some of theother lessons staff learned:

� Budget plenty of pharmacy time.The hospital underestimated how much time it wouldtake pharmacists to set up and maintain a formulary,says Denae Bachmeier, RPh, a clinical pharmacist atSt. Marys and the pharmacy lead for the MedPointproject. “Initially we thought, ‘Oh, it’s just a nursingdocumentation system. It has nothing to do with us,’ ”she says. “And we’ve learned that’s not the case.”

Bachmeier estimates that maintaining the formularyalone takes her and another pharmacist about a quar-ter of a full-time position. In addition, the hospital’sapproximately 30 pharmacists must now enter allorders into the computer system and help nurses trou-

What to look for in a bar code system

Are you thinking about purchasing a bar codesystem? Wendy Wittwer, RN, BSN, coordinator ofMadison, WI–based St. Marys Hospital MedicalCenter’s bar-code initiative, suggests that you lookfor a system that

� allows you control over how many and whattype of warnings the end user will receive.

� interfaces well with your pharmacy orderentry system.

� does not require specific hardware. Youmay want to use different types on variousunits.

� processes information quickly. “I do knowhuman nature and interacting with computersystems—if they’re not fast, forget it,” saysWittwer.

� allows users to exercise their clinical judg-ment. They should have the ability to bypass awarning and justify why they are doing it.


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bleshoot interface problems (e.g., medications notappearing on the screen properly).

Tip: Facilitate troubleshooting by tracking recurringproblems. St. Marys’ MedPoint planning group nowlogs all of the calls it receives about system issues.Group members document each problem and how itwas resolved.

Pharmacists welcomed a proposed rule by the FDA in2004 that would require manufacturers to place barcodes on all drugs and blood products. Placing barcodes on medications eats up technicians’ time be-cause they must run a machine that affixes the barcodes to containers, and it is also time-consuming forthe pharmacists, who must then check the labels.

Although having bar codes on all medications wouldbe ideal, the hospital hasn’t yet been able to accom-plish this task. So if a medication doesn’t have a barcode, nurses pick the correct medication from a touchscreen.

“It still documents that [a nurse] gave it, but it doesn’tcheck that it’s the right medication, which is the numberone thing that you’re trying to [do],” Bachmeier says.

In addition, staff cut down on bar coding time by pur-chasing medication in bulk rather than unit dose, andbar coding the whole bottle at one time. They also tryto purchase more medications from manufacturersthat supply their own bar codes.

� Allocate training time.Training is no small task. Wittwer and another nursemust train not only nurses, but also respiratory thera-pists, student nurse instructors, float pool staff, house-keepers, and pharmacists and information systemsstaff. Students—about nine at a time—review a studyguide for about an hour, and then attend a three anda half hour training class.

“I try to train people within two weeks of their go-livedate so that [the information is] reasonably fresh,” saysWittwer.

Tip: Consider all of the departments that will need tobe aware of the new system when you plan your train-

ing. For example, telecommunications staff will have towire the system and maintain firewalls. Housekeeperswill have to clean the equipment. In St. Marys’ case,that means a laptop computer, mouse, and bar codescanner in each patient’s room.

� Expect staff reluctance.Many nurses at St. Marys looked forward to the barcode system, but others were skittish about using thenew technology. “It is [a] major change for them,”says Wittwer.

Although scanning every medication adds an > p. 10

How the system works

Laptops, a scanner, and a mouse in every patientroom comprise the hardware for the bar-codingsystem at Madison, WI–based St. Marys HospitalMedical Center.

Nurses preparing to administer medications scantheir own identification badge and enter a pass-word. Then they scan the patient's bracelet to iden-tify the patient and pull up the patient’s medicationprofile on the laptop. If anyone has entered a neworder into the pharmacy system for the patient,these pop up immediately, allowing nurses todecide when and how to deal with them.

Nurses then scan the bar code on the medicationthey are preparing to administer. At this point, anyother important issues may appear on the screen.

For example, the nurse might not be aware thatjust 10 minutes earlier, another person had admin-istered the same pain medication she is preparingto give a patient. In that case, the system wouldinform the nurse that the patient should not yetreceive another dose of the medication.

The system documents the administration, andstaff print a paper record every 24 hours to placein patients’ charts. Managers study the data to findout about trends in practice related to specificindividuals, units, or medications.


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Computerized order system matches lab values, medications to catch adverse events

Computerized order systems may help prescribers andpharmacists catch interactions that could lead toadverse drug events, but hours of manual labor maybe required to recognize potential errors once thepatient starts a medication.

Catching an adverse drug event after the patientreceives the medication would require a pharmacistor physician to review the patient’s chart, which istime-consuming—if hospitals even dedicate staff timefor that task.

“If you are relying on a pharmacist or doctor to no-tice anything, that could take hours to manually re-view,” says John Russillo, RPh, clinical pharmacycoordinator at Mt. Diablo Medical Center in Concord,CA.

The St. Paul, MN–based VigiLanz Corp. developed theDynamic PharmacoVigilance system to monitor a pa-tient’s lab values and compare them to the patient’smedications, which can help identify potential adversedrug events. Hospitals can develop their own rule sets

extra step to the care-giving process, nurses save timein other areas.

For example, the system automatically produces doc-umentation when nurses confirm that they haveadministered a medication.

“They don’t have to physically transcribe orders, which[also] helps with transcription errors,” says Wittwer.

Tip: Look for informal leaders among nurses. Theycan help you get everyone on the same page, identifyproblems their peers experience during implementa-tion, and communicate the information to the entirenursing staff.

Most nurses at St. Marys eventually came to like thesystem. In fact, some nurses have told Wittier thatthey now feel uncomfortable working in units thathaven’t yet installed bar coding scanners, she says.

� Prepare for the future.St. Marys chose laptops for its bar coding systemhardware, so it will be able to add additional applica-tions more easily in the future.

For example, it hopes to integrate a pharmacy order

entry system that will allow clinicians access to labsand teaching tools. It also hopes to eventually useelectronic medical records.

Tip: Even if they’re not directly affected, keep physi-cians in the loop when you implement electronic sys-tems. Some physicians at St. Marys have recentlyexpressed interest in looking at patient informationonline in real time.

Wittwer cautions other hospitals not to try to installthe system in the whole facility at once. Because it isa big change, staff need a fair amount of hand-hold-ing and support—and most facilities won’t have theresources to focus on more than one unit at a time.

Has it all been worth it? “It’s a step in the right direc-tion,” says Bachmeier. “I’ll be surprised if most hospi-tals within the next five to 10 years don’t have somesort of bedside verification.”

Editor’s note: St. Marys Hospital Medical Center inMadison, WI, is a 350-bed level two tertiary communi-ty hospital. It was awarded the Magnet Recognition forNursing Excellence in 2002 and is part of SSM HealthCare, which won the Malcolm Baldrige NationalQuality Award in 2002.

Case study < p. 9


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to identify a potential adverse reaction, and an alertwill notify the pharmacist to the problem, says Vigi-Lanz CEO David Goldsteen, MD.

Reduce adverse drug eventsVigiLanz launched the Dynamic PharmacoVigilancesystem in June during the American Society of Health-System Pharmacists Summer Meetingin Boston, says Goldsteen. Goldsteennotes that the system differs fromcomputerized physician order entry(CPOE).

“This is significantly different fromwhat’s out there,” Goldsteen says.“There is nothing monitoring the drugonce it gets through CPOE.”

The VigiLanz system interfaces with a hospital’sexisting computer system, Goldsteen says. When itcompares a patient’s pharmacy file with the lab files,it can generate alerts if necessary to recommend thatthe pharmacist or physician raise or lower the drugdose, discontinue the drug, order another lab test, ortake other actions.

With a limited set of rules outlining how to comparelab values to medications, the system can reduce ad-verse drug events by 25%, says Paul Lentz, the com-pany’s business development and sales director.

With a full set of rules, that reduction could go ashigh as 50%, he says.

Prioritize actionsFaulkner Hospital in Boston piloted Dynamic Pharm-acoVigilance for VigiLanz and has used the system fornearly 18 months, says John Poikonen, PharmD, amedication safety pharmacist at Partners HealthCare,Faulkner’s parent system.

The hospital has the ability to deter-mine which rules it should create tomonitor lab values based on thepatient population, Poikonen says.The pharmacy and physicians can setup a system to prioritize alerts, al-lowing them to determine which onesare real and which may be false posi-tives, he says.

“It helps you work through what yourpriorities are,” Poikonen says. “You can say, ‘This ishappening on this patient, so this is what I’m going todo.’ ”

Safety at a fraction of the costA CPOE system may cost a hospital between $3 millionand $8 million and take two to three years to see anybenefits, Lentz says. VigiLanz charges hospitals basedon bed size, but a 150-bed hospital would spend about$46,000 each year for Dynamic PharmacoVigilance, hesays.

Every facility must pay a one-time $47,000 installationfee. VigiLanz maintains all of the necessary hardwareand software, with the typical installation

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“The system is only asgood as the hospital’s willingness to listen to

it and use it.”

—Paul Lentz


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taking 90 days, Lentz says.

Improve JCAHO complianceThe VigiLanz system can also help hospitals withJCAHO compliance, Lentz says. Hospitals can docu-ment intervention details, showing the interventionand the outcome for the patient, he says.

Organizations can also document potential adverse drugevents, which is helpful for reporting errors, Lentz says.

Use with CPOEAlthough VigiLanz has yet to work with CPOE manu-facturers, the system could complement a CPOE tool.The hospital of the future may have room for bothtechnologies, Lentz says.

“We see the optimal hospital in the future to have aCPOE system with a [Dynamic PharmacoVigilance]system that can monitor labs,” Lentz says. “The systemis only as good as the hospital’s willingness to listento it and use it.”

But technology—CPOE or lab monitoring systems in-cluded—is only a piece of the solution, Poikonensays.

“It’s one of the many strategies to reduce adversedrug events,” Poikonen says. “You can’t just plug it inand all the adverse drug events go away. It’s notgoing to happen.”

Editor’s note: Visit www.vigilanzcorp.com for moreinformation.

Hospital Pharmacy Regulation Report

Editorial Advisory BoardDavid Benjamin, PhDClinical Pharmacologist/ToxicologistChestnut Hill, MA

Diane Cousins, RPhVice president, Center for theAdvancement of Patient SafetyU.S. PharmacopeiaRockville, MD

Michael Hoying, RPh, MSPharmacy DirectorFairview and Lutheran HospitalsCleveland, OH

James O’Donnell, PharmD, MSAssociate Professor of PharmacyRush University Medical CenterChicago, IL

William Sarraille, Esq.Sidley Austin Brown & Wood LLP Washington, DC

Donna Soflin, PharmDDirector of PharmacyTri-County HospitalLexington, NE

Douglas Wong, PharmDPharmacy Healthcare SolutionsAmerisourceBergenCorporation

Fort Washington, PA

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