From July 2013 to June 2015, Genesis Health System in Davenport, Iowa, saw its pharmacy spend increase by a whopping 35 percent.
But through the work of Genesis and the Value Creation Office (VCO), the 642-bed organization reversed this trend, saving more than $710,000 in the first six months of 2016.
The savings came from reductions in the average daily cost of antimicrobials for each patient, in the length of stay for patients on an antimicrobial drug(s), some early returns on reducing in-hospital-acquired infections and better formulary management.
Overall, leaders at Genesis say their close relationship with Cerner helps the organization control costs and reach strategic goals.
Early in 2015, Genesis Health System expanded its 15-year relationship with Cerner by signing a 10-year Cerner ITWorksSM agreement, which included an on-site VCO.
“I’ve seen more positive changes in the last year than I have seen in the last five years combined,” said Kevin Cahill, director of pharmacy at Genesis Medical Center. “I feel like this a true partnership, and Cerner is embedded here at Genesis and is clearly part of the organization.”
One of the first requests that Chief Executive Officer Doug Cropper and Chief Financial Officer Mark Rogers had for the VCO, was to help Genesis get its pharmacy spend under control. By spring, an on-site Cerner team began assessing pharmacy workflows and inputs to evaluate what could be done to control costs.
The VCO found that many factors contributed to the increase, such as the amount of antimicrobials being prescribed, the increased use of higher cost antimicrobials, and patients receiving antimicrobials having a longer than average length of stay.
Importantly, the overuse of antimicrobials is known to cause higher rates of a digestive tract infection called C-Diff, which was leading to longer hospital stays for patients.
Due to gaps in the pharmacy IT infrastructure at Genesis, leaders did not have access to true medication costs or ordering patterns by physicians for specific diagnosis-related groups (DRGs). This lack of knowledge caused them to revert to deriving medication costs from charges.
With these challenges in mind, VCO leader Steve Hammer, along with his team, worked with Genesis and the ITWorks team to build a multi-step Pharmacy Spend Control program.
In January 2016, for example, the health system’s pharmacy leaders worked with the VCO to revamp Genesis’ Antimicrobial Stewardship Program, making changes to a governance committee, pharmacy staff and the health system’s electronic health record (Cerner Millennium) build.
In February, the team launched Cerner’s Infection Control solution, which helped the organization begin reducing the rate of hospital-acquired infections and the associated costs of medication needed to treat those infections.
Later in July, the VCO worked with Genesis’ Business Intelligence Center to implement a data analytics tool that flags exceptions to pharmacy best practices. This tool enables Genesis to analyze medication usage by several important variables, including ordering physician, patient-refined, diagnosis-related groups (APR-DRG), diagnosis, location, encounter type, service line and patient.
Finally, in August, the Genesis Pharmacy team implemented the Cerner Pharmacy Supply Chain solution, which will load the actual cost of medications into the electronic medical record, so leaders can track these costs in near-real time as the medications are dispensed. The supply chain solution will also update inventory counts by location after each medication is dispensed, eliminating the need for manual counts and enabling Genesis to have the right amount of drug inventory at the right time.
“Genesis will now know the current cost of their medication inventory on a daily basis,” said Hammer, director and strategic value executive with Cerner. “Genesis also will have the ability to analyze utilization patterns for antimicrobials in both the inpatient and outpatient settings.”