Retail Pharmacies and Largest Pharmacy Benefit Managers Announce Merger of E-prescribing Networks — Improving Safety, Accuracy, Efficiency of Prescription Medicines for Patients Nationwide
Tuesday, July 1, 2008
CVS Caremark, Express Scripts, Medco Health Solutions
Join with U.S. Chain and Independent Pharmacies to Accelerate
Transition
from Paper-Based to Paperless Prescribing
ALEXANDRIA, Va. and ST. PAUL, Minn. - July 1, 2008
- In the single most significant advance to the accuracy,
efficiency and quality of information associated with the 4 billion
prescriptions written annually in the United States, the nation's
retail pharmacies and leading pharmacy benefit managers (PBMs)
today announced an unprecedented collaboration to unite the
country's two leading
health information networks.
The groups have merged two organizations: RxHub, founded in 2001 by
the nation's three largest PBMs - CVS Caremark Corporation, Express
Scripts, Inc. and Medco Health Solutions, Inc.; and Surescripts,
also formed in 2001 by the National
Association of Chain Drug Stores (NACDS) and the National Community
Pharmacists Association (NCPA). The organizations will consolidate
their operations, forming a single, secure, nationwide network for
e-prescriptions and the exchange of health
information.
RxHub's expertise in patient identification and delivering drug
benefit information to the physician at the point of care
complements Surescripts' focus on electronic prescription routing
from the physician's office to the pharmacy. The merger combines
these strengths with a shared focus on more access to patient
medication history to form a single suite of comprehensive
services. The new organization will enable physicians to securely
access vital health information when caring for their patients
through a fast and efficient health information exchange. This will
allow them to transmit electronic prescriptions and renewal
requests to both retail
and mail-order pharmacies.
In 2008, the combined organization expects to transmit 100 million
electronic prescription transactions and respond to more than 70
million requests by physicians confirming information about their
patients' drug coverages and medication histories. With appropriate
patient consent, the combined organization will extend this
information to clinicians caring for more than 200 million
patients across the United States.
Easy, Efficient, Accurate, Safe and Secure
With this information more readily available, the process of
prescribing medications is measurably improved by:
providing physicians with added knowledge of their patients;
enabling a more informed choice of therapy;
ensuring that the medicine intended by the physician is actually
and accurately communicated to the pharmacy;
allowing patients to weigh important economic considerations within
a range of appropriate clinical options before a prescription is
written;
and adding convenience to the overall process.
"I can think of 4 billion reasons this merger makes sense," said
John Driscoll, president, New Markets, Medco Health Solutions, Inc.
"Prescribing medications for patients is one of the most
fundamental acts in healthcare. If we, as an industry and as a
nation, are serious about improving the quality of care and making
it more cost-effective, then immediate and sweeping measures are
required. This merger sets aside historic economic and political
differences to do what is necessary to advance paperless
prescribing and the secure exchange of critical information between
providers - instantly elevating the quality of care."
"This merger represents a collaboration between industries that are
equally committed to improving healthcare," said Bruce Roberts,
executive vice president and CEO, NCPA. "The combined strengths of
the two organizations will enable the delivery of a single suite of
services that will dramatically improve the safety, efficiency and
quality of one of the largest segments in healthcare. We remain
committed to maintaining the guiding principles that have driven
the success of Surescripts and RxHub to date. We will continue to
protect patient choice of pharmacy and physician choice of
therapy."
Today, there are hundreds of technology vendors developing
electronic medical records - as well as other clinical software
that includes e-prescribing functionality - used by physician
practices across the United States. For these vendors, the merger
of RxHub and Surescripts will offer a single, unified process for
testing and certifying their products' connection to a single
network
and the services it provides. Streamlining these processes will
save the industry time and money and will offer physicians more of
the information they need to provide quality care to their
patients.
The new organization will remain committed to proactively
supporting the standards that have been defined for electronic
prescribing and health information exchange and will continue to
collaborate with leading standards and accrediting
organizations.
Merger Details
The boards of directors of both organizations approved the cashless
merger of equals. Surescripts' owners (NACDS and NCPA) will retain
50 percent ownership as will RxHub's owners (CVS Caremark, Express
Scripts and Medco Health Solutions). The new organization will
remain privately owned and continue to operate under a
cost-recovery model as a low-cost health information utility.
Initially, the new organization will be jointly managed by the
acting CEO of RxHub, J.P. Little, and the acting CEO of
Surescripts, Rick Ratliff. The new board has begun a process to
select a CEO and has retained Spencer Stuart to conduct a
nationwide search. Driscoll and Roberts will serve as co-chairmen
of the board of directors through 2009. The co-chairmen will rotate
on an annual basis to include one co-chair representing PBMs and
the other representing retail pharmacies. The new six-member board
includes a single director each from CVS Caremark, Express Scripts,
Medco Health Solutions, NACDS and NCPA. The sixth member of the
board is designated by NACDS and NCPA. The combined company will
have more than 75 employees and will maintain its existing office
locations in St. Paul and Alexandria.
The new organization is undertaking a rebranding initiative. In the
interim, the company will be referred to as Surescripts-RxHub. For
more information regarding this merger, please visit www.SurescriptsRxHub.com.
E-Prescribing's Unprecedented Momentum
We expect this transaction to add momentum to the rapidly
developing nationwide support for e-prescribing. Some recent
developments include:
In December of 2007, U.S. Sen. John Kerry joined with former
Speaker and founder of the Center for Health Transformation Newt
Gingrich and a number of Senate colleagues to announce the
introduction of the Medicare Electronic Medication and Safety
Protection Act ("E-MEDS"). The E-MEDS bill proposes to offer
physicians reimbursements for investing in e-prescribing technology
as well as incentive payments each time a prescription is
transmitted electronically and the claim is submitted through
Medicare.
During that same week in December, U.S. Sen. Sheldon Whitehouse
chaired a Senate Judiciary Committee hearing on the Drug
Enforcement Administration's policy prohibiting e-prescribing of
controlled substances. This policy requires physician practices to
maintain two separate processes for prescribing: one that is
paper-based for controlled substances and another that is
electronically based for all other medications. In the view of many
physicians and pharmacists, the administrative burden of
maintaining two separate processes is a significant barrier to
adoption and use of e-prescribing. If the DEA were to permit
e-prescribing of controlled substances, it would represent another
potential boost to e-prescribing adoption and use.
Beginning on March 4, 2008, the American Academy of Family
Physicians (AAFP), the American Academy of Pediatrics (AAP), the
American Academy of Nurse Practitioners, the American Academy of
Physician Assistants, the American College of Cardiology (ACC), the
American College of Obstetricians and Gynecologists (ACOG), the
American Osteopathic Association (AOA) and the Medical Group
Management Association (MGMA) took the unprecedented action of not
only announcing their support for e-prescribing, but also launching
a nationwide program and an online portal - www.GetRxConnected.com - where
physicians can follow a step-by-step process designed to help them
transition from paper-based prescribing to e-prescribing.
GetRxConnected.com was created under the auspices of The Center
for Improving Medication Management (founded by the AAFP, Humana
Inc., Intel Corporation, the MGMA and Surescripts).
On April 2, 2008, the Centers for Medicare and Medicaid Services
issued final standards for e-prescribing under the Part D Medicare
drug program.
As of April 14, 2008, the following organizations have formally
voiced support for e-prescribing: AARP; AFL-CIO; American
Federation of State, County, and Municipal Employees; Center for
Medical Consumers; Childbirth Connection; Consumers Union; Health
Care For All; National Consumers League; National Family Caregivers
Association; National Partnership for Women & Families; and
SEIU.
On June 27, 2008, the DEA proposed regulations that would provide
physicians and other authorized prescribers with the option of
issuing electronic prescriptions for controlled substances. These
regulations would also permit pharmacies to receive, dispense, and
archive these electronic prescriptions. The agency is seeking
public comment on the proposed regulations through September 25,
2008.
The timing of today's merger is, therefore, no coincidence. It
reflects the view by all board members that the merger will combine
with recent events to greatly accelerate the nation's move toward
paperless prescribing and the secure, electronic exchange of health
information.
