Moral Hazzard & Managed Care Pharmacy (Exam II)

Question 1

What is another word for moral hazard?

Answer 1

over utilization

Question 2

What is moral hazard?

Answer 2

the theory that the redistribution of risk (insurance) changes people’s behaviors

Question 3

In regard to moral hazard, when insurance increases what also increases and why?

Answer 3

health care usage because people are confident that insurance will cover them

Question 4

RAND- Health Insurance Experiment (RAND-HIE)

Answer 4

their goal is to reduce adverse selection; therefore, people will be assigned to different kinds of cost sharing

In other words, to get rid of adverse selection RAND-HIE will spread people through different options of cost sharing or increase variation of cost sharing

Question 5

Explain the free market in relation to RAND-HIE

Answer 5

patients will pay for services through premiums like a ‘pre-payment’ for using services

Question 6

What is provider indued demand?

Answer 6

individuals choose what or whether services to buy

Question 7

True or False: Health care is a negative good.

Answer 7

True

Question 8

What is utilization determined by?

Answer 8

Need

Question 9

What is utilization not determined by?

Answer 9

Price

Question 10

Health care delivery systems can create ____?

Answer 10

demand

Question 11

Managed Care Pharmacy

Answer 11

evidence-based medicine to reeducate on the appropriate use of medications which would lead to better patient outcomes while lowering the over-utilization of resources

Question 12

Who are the players in managed care? (7)

Answer 12

1. employer groups
2. Medicaid
3. Medicare
4. Physicians
5. PBM
6. Patients
7. Big Pharma

Question 13

What is PBM?

Answer 13

pharmacy benefits manager; a company that administers pharmacy benefit and design

Question 14

What are some of the resources that PBM offers? (3)

Answer 14

manage prescription drug benefits
help make sure patients have access to safe and effective and affordable medications
decision support

Question 15

Where do you see PBMs?

Answer 15

retail, mail, and specialty

Question 16

What are the specific tasks of a PBM?

Answer 16

1. manage formularies
2. contracts with pharmaceutical manufactures
3. offer medication therapy
4. health and wellness programs (smoking cessation, health risk assessment, disease management)
5. offer and design clinical programs

Question 17

Who do PBMs serve?

Answer 17

1. insurance groups
2. blue cross/blue shield
3. corporate health plans
4. government entities
5. Third Party Administrators
6. Medicare Part D individuals

Question 18

What are the focuses of managed care pharmacy?

Answer 18

1. clinical programs
2. quality
3. medication utilization review
4. evidence and data analytics to support decisions
5. formulary management

Question 19

What is a drug formulary?

Answer 19

comprehensive medication list that has been to together by physicians, pharmacists, and other health care professionals to treat and diagnose diseases

Question 20

What is the purpose of drug formularies?

Answer 20

encourages use of safe, effective, and affordable medications

Question 21

Who are the formularies used by?

Answer 21

1. Hospitals/Health Systems
2. Employer Groups
3. Managed Care Organizations
4. Pharmacy Benefit Managers
5. Government Agencies (Medicare and VA)

Question 22

What are three things that formularies accomplish?

Answer 22

1. offer one or more therapeutic recommendations per disease state
2. facilitates purchasing and prescribing
3. manages cost by reducing duplication of medication

Question 23

Drug Formularies use a _____ tool with drug manufactures so drugs can be discounted.

Answer 23

negotiation

Question 24

What are examples of organizations that provide guidance for drug formularies?

Answer 24

1. CMS
2. AMCP
3. ICER

Question 25

What are the two most important concepts about drug formulations?

Answer 25

1. medications on formulary are determined by pharmacy and therapeutics committee 2. P&T are made up of doctors, pharmacists and other professionals

Question 26

How are formularies sorted?

Answer 26

by tiers

Question 27

What is an open formulary?

Answer 27

the payer may provide coverage for all formulary and non-formulary drugs

Question 28

What is a closed formulary?

Answer 28

non-formulary drugs are not reimbursed by the payer

Question 29

True or False: Payers will not create extra tiers to gain more memberships in certain drug classes and categories.

Answer 29

False; they can

Question 30

What are examples of extra tiers?

Answer 30

1. Specialty Injectionable 2. Lifestyle Medications 3. Value Based Copay 4. High Cost Generic Teirs 5. Percentage copays

Question 31

What is used to determine quality?

Answer 31

1. Medicare Part D 2. Healthcare Effectiveness Data and Information Set 3. Drug Safety Programs 4. Medication Therapy Management

Question 32

Examples of Clinical Programs?

Answer 32

1. Disease management 2. Medication Management 3. Adherence Programs 4. SDOH programs 5. Health Disparity Initiative