Cost savings and avoidance from clinical interventions

A method that lets a pharmacy department collect data on cost savings and avoidance achieved through pharmacist interventions is described. The pharmacist intervention program at an 849-bed institution is based on the pharmacist's evaluation of the patient, the disease or condition, and the appropriateness of the drug therapy selected. The pharmacist records the recommendation, the rationale, and the intervention outcome, and the data are entered into the medication order-entry system. An assigned code indicates the potential severity of consequences had the intervention not been made. The information is forwarded to the clinical interventions and financial assessment committee (CLIFAC) for analysis of cost savings and potential cost avoidance. To calculate savings, CLIFAC determines the drug acquisition and relevant laboratory costs that would have been charged, as well as the cost of a change in therapy. A method was developed that allows CLIFAC to use hospital-specific diagnosis-related-group data to determine potential cost avoidance as a function of hospital days prevented. From July 1994 through April 1995, 4648 interventions were documented by the 50-member inpatient and ambulatory care pharmacist staff and evaluated and quantified. Of these interventions, 87% were accepted by the medical staff. The accepted interventions represent a net therapy cost saving of $487,833, as well as a cost avoidance of $158,563 achieved by prevention of a potential net 371.9 additional hospital days. A pharmacy department's financial assessment committee evaluated pharmacist interventions by determining changes in the cost of therapy and estimating potential changes in the length of stay.