Butler pharmacists develop tool to guide insurers on drug formularies

Butler University has trained thousands of pharmacists since the program began in 1945 as a merger between the university and the Indianapolis College of Pharmacy. During that time, it has walked students through the basics of biopharmaceuticals, medicinal dosages, clinical assessments and pharmacy practice.

Now, it’s sharing its know-how with insurance companies around Indiana to make sure they are covering the right drugs.

The university has developed a tool to help insurers as they develop their formularies, or list of medicines, that will fulfill federal laws of not discriminating against patients with certain diseases.

Butler said it was approached by the Indiana Department of Insurance to draw up detailed lists of medicines that insurance companies should cover for 17 disease areas that are health priorities in the state.

“They said, ‘You’re pharmacists. You know what these drugs are and how they work. So, can you give us more insight, more information?’” said Carriann Smith, Butler professor of pharmacy practice.

The 17 diseases are attention-deficit/hyperactivity disorder, asthma, bipolar disorder, chronic obstructive pulmonary disease, depression, diabetes, dyslipidemia, epilepsy, hepatitis C, human immunodeficiency virus (or HIV), multiple sclerosis, rheumatoid arthritis, schizophrenia, sleep disorder, opioid-use disorder, alcohol-use disorder, and post-traumatic stress disorder.

Insurance companies have broad latitude to decide which treatments and medicines to cover. But the state wanted a more rigorous approach, and to make sure insurance carriers were covering an adequate amount of prescription drugs.

Butler used funds from an in-house innovations grant and assembled a group of faculty, students and alumni to study the issue.

The challenge was formidable. All insurance companies had been sending their formularies to the Indiana Department of Insurance in the form of a numbering system. So the state didn’t have an easy way to determine if the formularies were clinically appropriate.

The Indiana Department of Insurance began using the tool last year, Butler said. The insurance department confirmed that it reached out to Butler.

So the Butler team began building a database tool—which doesn’t have a formal name, but is referred to as a “clinical appropriateness tool”—that took into account the latest research, published literature, federal regulatory approvals and clinical experience.

The goal was to bridge the gap between the regulators, the insurance companies and the clinicians. Another goal: reduce the paperwork, prior authorizations and delays on drugs that should be part of the front-line regimen for certain diseases.

Like good pharmacists, they weighed the benefits and potential side effects for patients, to make sure the right medicine would be available for the right people. At the same time, they wanted to give insurance companies and state regulators some discretion, especially for diseases and treatments that are still evolving.

“The last thing we wanted to do is create a statewide formulary that requires everybody to cover the same thing,” Smith said.