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Gina Pferdehirt
Director, Public Relations & Community Relations
UPMC Health Plan

UPMC Health Plan Establishes Unprecedented Center for Value-Based Purchasing for Pharmaceuticals

The focus will address the rising cost of prescription medication

PITTSBURGH (May 31, 2017) – UPMC Health Plan has established the new Center for Value-Based Purchasing for Pharmaceuticals. By leveraging a unique set of assets and resources at UPMC Insurance Services Division, the new group aims to fundamentally change the way medications are paid for in the U.S.

Led by UPMC Health Plan’s Chief Medical Officer, William Shrank, MD, and Chief Pharmacy Officer, Chronis Manolis, RPh – both of whom are nationally-recognized experts in pharmaceutical outcomes research, pharmacy practice, progressive payment models, and managed care leadership – the Center for Value-Based Purchasing for Pharmaceuticals is supported jointly by UPMC Health Plan and a research grant from Express Scripts, the nation’s largest pharmacy benefits manager.

“We anticipate that the models and learnings from this effort should be highly scalable to other insurance providers and pharmacy benefits managers, which will give the Center for Value-Based Purchasing for Pharmaceuticals the opportunity to rapidly influence pharmaceutical purchasing nationwide and promote greater value in medication use,” said Dr. Shrank. “As the dominant payer in Western Pennsylvania, with over 3.2 million members, and the dominant health system in the region that is also affiliated with a medical school, UPMC can align policy and provider practice for a considerable proportion of the region’s population. The groomed, integrated data sources at UPMC allow for seamless access to both clinical data from electronic medical records as well as health outcomes data from insurance claims.”

As the health care system shifts reimbursement from volume to value, there has been increasing interest in new and more progressive ways for payers and pharmaceutical manufacturers to create partnership contracts that create greater alignment between both parties and help to connect a manufacturer’s reimbursement to the value that their pharmaceutical products deliver. Despite this growing interest, such contracts have been hindered by several barriers, including limited collaboration and consensus between prescribers and payers, difficulty measuring value (due to fragmented and limited data sets and lack of consensus on measures), and regulatory concerns.

Priorities for the Center for Value-Based Purchasing for Pharmaceuticals will include:

“These capabilities will allow the Center for Value-Based Purchasing for Pharmaceuticals to address the rising cost of medications and support more shared accountability and partnership with manufacturers, and greater value in pharmaceutical care,“ said Manolis.

As an initial step, UPMC Health Plan has partnered with RxAnte, Inc., to begin measuring and reporting drug performance in several therapeutic categories of interest. Results will inform the Center for Value-Based Purchasing for Pharmaceuticals as well as clinical program development at UPMC Health Plan.

The Center for Value-Based Purchasing for Pharmaceuticals will be housed within UPMC’s Center for High-Value Health Care, the Health Plan’s not-for-profit research group. The success of the Center for Value-Based Purchasing for Pharmaceuticals will be measured by its ability to develop, implement, and broadly scale new value-based payment models within UPMC, Express Scripts, and beyond.


About UPMC Insurance Services Division

The UPMC Insurance Services Division is owned by UPMC (University of Pittsburgh Medical Center) a world-renowned health care provider and insurer based in Pittsburgh, Pa. As a provider-led organization that is part of an integrated health care delivery system, the UPMC Insurance Services Division is committed to providing its members better health, more financial security and the peace of mind they deserve. The UPMC Insurance Services Division partners with UPMC and community network providers to produce a combination of knowledge and expertise that provides the highest quality care at the most affordable price. The UPMC Insurance Services Division – which includes UPMC Health Plan, WorkPartners, UPMC for Life, UPMC for You, UPMC for Kids, and Community Care Behavioral Health — offers a full range of group health insurance, Medicare, Special Needs, CHIP, Medical Assistance, behavioral health, employee assistance and workers' compensation products and services to more than 3.2 million members. For more information, visit www.upmchealthplan.com.

About the UPMC Center for High-Value Health Care

The UPMC Center for High-Value Health Care, housed within the UPMC Insurance Services Division, translates the work of the UPMC Health Plan, Community Care Behavioral Health, and the organization’s additional integrated partner organizations into evidence-based practice and policy change for improving health care quality and efficiency and the overall health of the population. Many activities are conducted in UPMC’s unique payer-provider laboratory and supported through grants and contracts carried out in partnership with community organizations and government agencies. UPMC is a global health enterprise and one of the nation’s largest integrated health care delivery and financing systems. UPMC and its Insurance Services Division recognize and embrace the value of collaboration in achieving an equitable, high-quality, and efficient health care system that meets the needs of diverse populations. For more information, visit www.upmchighvaluehealthcare.com.