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Electronic Rx program helps cut health care costs at General Motors

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DAYTON, Ohio—A joint insurer-employer initiative is providing incentives to physicians in two Ohio areas to use electronic prescribing technology.

The project by Detroit-based General Motors Corp. and Indianapolis-based Anthem Blue Cross & Blue Shield is an extension of a pilot program GM conducted last year in southeast Michigan with Blue Cross & Blue Shield of Michigan.

E-prescribing reduced GM's health care costs by about $3 million in 2006 by boosting generic drug use from 56.7% to 67.6% among its Detroit-area plan members, said Marsha Manning, manager of GM's Southeast Michigan Community Health Care Initiatives project, which promotes greater use of health information technology.

The savings resulted from changing more than 70,000 of the 1.7 million prescriptions written for GM employees in southeast Michigan after providers received formulary warnings through their e-prescribing equipment about lower cost generic equivalents, Ms. Manning said.

In addition, the pilot also improved patient care by lowering adverse drug reactions and hospitalizations that may occur when patients are prescribed drugs that interact negatively, Ms. Manning added.

Though "it's hard to calculate the cost avoidance of someone having an adverse drug event," she said doctors with access to the e-prescribing technology changed about 150,000 prescriptions due to drug-to-drug interactions and more than 11,000 prescriptions due to allergy warnings.

GM expects to achieve similar results in Dayton as well as the Warren/Youngstown area, Ms. Manning said.

Other employers where the Ohio pilot is taking place also stand to benefit since participating doctors will be allowed use the e-prescribing technology with all patients--not just GM employees or Anthem plan participants, said Sam Shalaby, director of GM Community Health Care Initiatives in Dayton.

"We believe that if we improve the quality of care and reduce the cost of care, it will improve the value to the entire community," Mr. Shalaby said.

"Our mission is to improve the health of communities we are in. All boats will rise with the tide," agreed Rich Gunza, executive director of Anthem in Dayton.

Under the program, Anthem initially will supply 100 doctors--200 more will be added later this year--with e-prescribing equipment from St. Paul, Minn.-based vendor RxHub L.L.C. Doctors will decide what type of hardware to use with software connecting them online with pharmacies and other patient data, including formularies.

Anthem also will pay each physician's $40 monthly online connection fee for 12 months. Doctors who positively alter their prescribing habits will be eligible for increases in their scheduled fees of up to 12% in the Dayton market and up to 5% in northeast Ohio, Mr. Gunza said.

Other health information technology advocates praised GM's and Anthem's efforts.

"It is a fabulous idea. If ineffective processes are also re-engineered, quality will be improved, errors will be reduced, and all will save time, money and demoralizing hassle," said Helen Darling, president of the Washington-based National Business Group on Health.