VA Health Care:

Opportunities Still Exist for Reducing Fee-Basis Pharmacy Costs

HRD-86-66: Published: Mar 6, 1986. Publicly Released: Mar 6, 1986.

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GAO followed up on its 1983 report which recommended that the Veterans Administration (VA): (1) reduce the number and cost of prescriptions filled by private pharmacies on a VA-reimbursable, fee-for-service basis; (2) strengthen its efforts to identify prescriptions that should not have been filled by private pharmacies; and (3) deny payments if veterans fail to use VA pharmacies after being asked to do so.

GAO found that: (1) the number of prescriptions filled for VA by private pharmacies decreased by about 28 percent in fiscal year 1985; (2) at 21 of the 78 clinics it reviewed, private pharmacies still filled more than 5 percent of the fee-basis prescriptions; and (3) the clinics could have saved about $625,000 if private pharmacies had filled only 5 percent of their fee-basis prescriptions. GAO also found that: (1) most clinics are already exceeding the goal of having VA pharmacies fill 95 percent of their fee-basis prescriptions; and (2) VA management has no way to compare clinics' performance against the 95-percent goal.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: VA concurred with this recommendation and prepared a circular formulating the 95-percent goal. The circular was issued on June 16, 1987, and will be incorporated into VA manual M2, Part 7, chapter 4, by July 1988.

    Recommendation: The Chief Medical Director of Veterans Affairs should establish, as a formal goal, that clinics of jurisdiction fill at least 95 percent of fee-basis prescriptions in VA pharmacies.

    Agency Affected: Veterans Administration

  2. Status: Closed - Implemented

    Comments: VA concurred with this recommendation and prepared a quarterly report comparing the performance of each clinic of jurisdiction in meeting the 95-percent goal.

    Recommendation: The Chief Medical Director of Veterans Affairs should require VA central office officials to routinely monitor reports to determine clinics' performance compared to the 95-percent goal.

    Agency Affected: Veterans Administration

  3. Status: Closed - Implemented

    Comments: VA concurred with this recommendation and sent a quarterly report to its regions for appropriate follow-up with clinic officials.

    Recommendation: The Chief Medical Director of Veterans Affairs should discuss, with officials of clinics not meeting the goal, the extent to which nonemergency prescriptions are being filled by private pharmacies and, if appropriate, the types of actions necessary to reduce this number.

    Agency Affected: Veterans Administration

 

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