EPIC, HUMANA TEAM UP TO SLASH DRUG COSTS


Photo: Luke Sharrett/Bloomberg via Getty Images

Electronic health record (EHR) system vendor Epic is integrating a real-time benefits checker, dubbed IntelligentRx, from US insurer Humana that’s designed to help health firms lower costs associated with prescription drug spending and poor medication adherence. Humana’s IntelligentRx will integrate with Epic’s e-prescribing workflow, enabling physicians to review a patient’s treatment options and cost information before prescribing medication. It’s unclear how many patients or Epic hospital clients the integration will impact, but both are big players in their respective industries: Humana covers north of 16 million customers and Epic’s system runs in 58% of large US hospitals.

The integration should help Humana scale back the resources it devotes to member drug spending:

  • Reductions in prescription drug spending could trickle down to the cost of customers’ medical claims. Physicians who use Humana’s tool prescribe a cheaper prescription 40% of the time, which could help the payer reduce a significant chunk of its expenditures: Drug spending accounted for 19% of health spending per US consumer in 2017, and spending on drugs has increased by roughly 5% or more annually between 2013 and 2017.
  • And steering members toward cheaper drugs could help ensure medication adherence — and prevent Humana from shelling out cash for more expensive hospital services later on. About 3 in 10 of all US adults report not taking their medicines as prescribed at some point in the past year because of the cost — and 29% of those consumers reported their conditions worsened as a result, per a new Kaiser Family Foundation report.

This marks Epic’s first health plan partnership of its kind, which underscores how value-based care (VBC) is forcing EHR vendors to evolve beyond their core offerings to meet the needs of their customers. VBC — a burgeoning reimbursement model that ties provider compensation to cost-effective patient outcomes rather than the number of services delivered — could account for the bulk of US healthcare payments within five years. The rise of VBC triggers a change in health systems’ and hospitals’ IT needs, as traditional EHRs were built around — and partly to facilitate — fee-for-service payments. In turn, Epic and its EHR vendor counterparts are being forced to diversify their platforms and form strategic partnerships. For example, Epic rival Cerner spent $270 million on a 10-year partnership with value-based services vendor Lumeris in July 2018 to roll out a platform that helps providers manage value-based arrangements for Medicare patients. With VBC gaining momentum, we think leading EHR vendors will continue to form outside partnerships and launch new products to keep pace with the evolving needs of US provider organizations.