VVA Testimony VVA Testimony
VVA Testimony



Vietnam Veterans of America

Presented By

Richard Weidman, Executive Director for Policy and Government Affairs

Before the

House Veterans Affairs Subcommittee on Health


Is the VA Meeting the Pharmaceutical Needs of Veterans? An Examination of the VA National Formulary, Issues of Patient Safety, and Management of the Pharmacy Benefits Program

September 22, 2009


Chairman Michaud, Ranking Member Brown and distinguished Members of the Subcommittee, on behalf of National President John Rowan, our Board of Directors and members, I thank you for giving Vietnam Veterans of America (VVA) the opportunity to testify today regarding the “ Is the VA Meeting the Pharmaceutical Needs of Veterans? An Examination of the VA National Formulary, Issues of Patient Safety, and Management of the Pharmacy Benefits Program.”

In May of this year of this year VVA wrote to Chairman Filner as part of VVA’s answer to his question about issues that need to be addressed by the House Veterans Affairs Committee VVA responded with five issues, one of which is described below:

“Pharmacy Service – the formulary is much too restrictive (and much more restrictive than either DOD or Medicare) on the theory that they are going to save a lot of money on medications. However, they often save pennies and spend big dollars because they scrimp on medications that could have prevented very costly acute care in-patient stays. The method of evaluating pharmacists needs to be dramatically changed from how much in “savings” they produce in comparison with the national average (which becomes a “race to the bottom”) to how much did what they do in cooperation with the medical staff at a given VA Medical Center to promote healing and wellness, and reduce in-patient acute care stays in the hospital, and/or to prevent secondary conditions from developing.”

The crux of this issue remains the same some five months later.

In lay terms, VVA believes that what we have at the Veterans Health Administration (VHA) of the U.S. Department of Veterans Affairs (VA) is a mentality that tries to reduce front end costs (e.g., pharmaceutical costs) which they call “cost avoidance,” without regard to overall impact either on the health of the individuals concerned or the overall cost impact on the system. In other words, they save some money by artificially limiting the number and type of pharmaceuticals that are generally available to clinicians at the VHA facilities, regardless of whether that in the medium to long-run it causes veterans to have secondary conditions. This practice is justified on the basis of “cost effectiveness” within the context of just pharmaceuticals alone, without regard for the rest of the medical setting.

It is ironic that the Research & Development section of VA is holding a conference tomorrow in Washington to look at “comparative effectiveness” in research and in other applications. While models such as evidence based medicine has a real place, and has
been of significant use especially in treating psychiatric problems, it has all too often been misapplied to practical allocation of resources, such as the way in which VHA has
Implemented the formulary at VHA. VVA would suggest that “comparative effectiveness” be applied to the overall health care system, in such a way as to focus on “comprehensive effectiveness.”

Frankly, “comparative effectiveness” has been misapplied to the VA formulary in such a way that it is a “race to the bottom.” Furthermore, when you are sick, Mr. Chairman, you are not necessarily in the majority part of the group that inexpensive “drug A” worked for just as well as the more expensive (usually copyright/patent protected) “drug B” when the two were tested for efficacy against each other. The decision of which to offer should be a clinical decision by the physician in concert with the patient, as to what is going to work the best for the individual patient. The practical tools available to a veterans’ physician should not be artificially limited by what is listed on the VA formulary.

We know if something is not on the formulary, it is very difficult, if not impossible, for most patients of that physician to get it. When we raise this issue, VA retorts that any physician can order any Food & Drug Administration (FDA) approved medication, whether it is on the formulary or not. While theoretically a physician can secure medications not on the formulary, as a practical matter it is inordinately difficult and time consuming to do so, and if a physician does it too often, they are “counseled” by their supervisor.

VVA has made the point to three of the most recent Undersecretaries for Health at VA, and to Secretary Peake when he was in office, that the VA National Formulary decision making process lacks transparency and public input that would cause them to have justify keeping something off of the formulary as opposed to putting something on the formulary. This is just not right, and no way to make public “life or death” policy decisions. This entire process needs to play out in the open, in the sunshine, where it can clearly be seen by the public and by clinicians what is being done and why it is being done. That is not the case at VHA today.

The VA formulary has just over 1,300 drugs while the average Medicare Part D formulary has more than 2,000 drugs. Only 38% of the drugs approved by the FDA in the 1990s, and 19% of the drugs approved since 2000, are on the VA National Formulary. It is clear to us that the VA has a policy bias toward generics and those drugs whose patents have expired, making them cheaper. This is despite the fact that the VA has the best price in the world on pharmacy medications.

While we do not believe that “newer” is always better, that is a clinical decision that the veteran’s individual physician should be making, and not “the green eye shade” fiscal guys in a back room somewhere.

The restrictive VA formulary could have a deleterious affect on the longevity and quality of life of veterans. Just one example of this is how slow VHA was to add the long-lasting insulin to the VHA formulary (and then only after significant pressure from VVA and from this committee), and the fact that many of the most effective treatments for diabetes, many of which have appeared on the market since 2000, are still not available on the VA formulary. The average beneficiary has better access to newer diabetes and heart disease drugs through Medicare Part D and Medicaid than does the average veteran through the VA. This is just wrong, and needs to be fixed by broadening the VA formulary, and by opening up this whole process.

The toughest things to get on the VA formulary of all are the most innovative “new molecular entities” almost all of which are still under patent, and therefore avoided by the VA decision-makers. In this instance there is apparently an evidence based process, but it can be (and often it is) vetoed by the pharmacy people strictly on the basis of the cost of the medication, and not by any part of an overall decision as to what is best for the veteran’s overall health, nor the like total cost to the medical system of NOT providing this medications to veterans who would be helped by it.

By restricting access to innovative drug therapy for chronically ill veterans, VVA believes that the overly restrictive VA formulary may result in less than optimal health outcomes. Said another way, it is our belief that many of the VA Medical Centers are not doing such a great job of controlling the measures of diabetes A1C, partly because of the restrictive policies on medications. This results in “spikes” that are what cause the secondary conditions and/or very costly inpatient hospitalization stays in some of the more than a million diabetics being treated by VA. For this reason, it also results in the veteran developing secondary conditions, which are also service connected and result in higher monthly payments. But, obviously, the key thing here is the diminishment of the quality of life for the individual veteran.

While the 2000 Institute of Medicine (IOM) study of the then newly implemented (1997) VA National Formulary … “found that the VA National Formulary is not overly restrictive, and the limited available evidence suggests that it has probably meaningfully reduced drug expenditures without demonstrable adverse effects on quality.”

However, the IOM report findings continue: “The (IOM VA Formulary Study) committee also concluded that there are manifold opportunities to improve the management of the formulary system use by the VHA. The National Formulary lacks essential systems to assure that new drugs are expeditiously reviewed for inclusion, and that a responsive process for assuring access to medically necessary exceptions to the formulary is consistently in place system-wide, that therapeutic interchange is accomplished in a flexible and consistent way, sensitive to patient risk, across the far-flung VHA system, and that views of critical constituencies of both providers and patients are represented in the management of the National Formulary…”

Perhaps most troubling, the (IOM) committee found “a dearth of information to evaluate the full impact of the National Formulary on veterans health and satisfaction, and on the VHA.” That remains the case today because the VA process takes place in the back room, out of public view.

Since the time of the IOM Study of the VA National Formulary, the VA Formulary and Formulary process has only grown more restrictive and little has been done to address the concerns expressed in the IOM study. Individual Veterans Integrated Services Network (VISN) formularies have been eliminated in favor of only a consolidated VA National Formulary.

The VA Formulary process involves internal Pharmacy and Medical expertise through its own Medical Advisory Panel (MAP) and is cross connected to the Department of Defense Pharmacoeconomic Center (DoD PEC) and Indian Health but does not have outside professional or beneficiary interest represented, such as the Veteran Service Organizations, or professional pharmacy and pharmacists organizations, or advocacy groups like the American Diabetes Association. Appropriate national level professional organizations that would best represent the patient as relates to safe and appropriate medication use, could include representation from professional organizations such as the American Pharmacists Association (APhA), American Society of Health-System Pharmacists (ASHP), Academy of Managed Care Pharmacy (AMCP), and American Society of Consultant Pharmacists (ASCP), as well as other professional medical societies.

The lack of transparency and insular nature of the VA formulary decision making process is problematic and leaves unanswered questions about access to care, chronic disease care, criteria use in reaching decisions (e.g., costs versus long-term clinical effectiveness). VA should publish specific drug decision making criteria, including the
therapeutic category review schedule, decision making process, Pharmacy and Therapeutics Committee and Medical Advisory Panel members, meeting schedules, and discussions of specific decisions. In addition, the public should have an opportunity to submit information to the VA Pharmacy and Therapeutics Committee in preparation for each decision meeting.

The VA formulary decision making process should also include a VA Pharmacy Beneficiary Advisory Committee as does the Department of Defense TRICARE Uniform Formulary process. For example, the Department of Defense/TRICARE publically
announces in advance its therapeutic class review schedule, the specific drugs for review, and the criteria for comparing different drugs.  The DoD Pharmacoeconomic Center (PEC) receives pricing and clinical data from the public including pharmaceutical companies which are considered by the DoD Pharmacy and Therapeutics (P&T) Committee.  The DoD publishes on its website ( HYPERLINK "http://www.pec.ha.osd.mil/" http://www.pec.ha.osd.mil/) the recommendation of the P&T Committee, the rationale, and summary of the data considered. 

These recommendations are then reviewed by a DoD Beneficiary Advisory Panel (BAP; HYPERLINK "http://www.tricare.mil/pharmacy/bap/" http://www.tricare.mil/pharmacy/bap/) composed of non-government beneficiary, professional and patient advocacy organization representatives, TRICARE contractors, and others. These meetings are also announced in advance, open to the public, and the results are published on the PEC website.  The P&T Committee and the BAP recommendations are then forwarded to the Director of the TRICARE Management Activity for final decision. In most cases, newly FDA-approved prescription medications are available from TRICARE network pharmacies and the mail-order pharmacy program shortly after they become commercially available. Furthermore, the public has the opportunity for input at each step in the decision making process, and it is transparent.
Conversely, the Department of Veterans Affairs National Formulary decision making process lacks transparency and opportunity for public input. This results in major disadvantages for VA patients and the quality of VA healthcare. It can be argued that the overly restrictive VA formulary as it stands today is significantly distorting the practice of medicine at the VA, to the detriment of the health of veterans who seek care there.


Optimally, the Congress will pass a law mandating an open and transparent process that is modeled on the law for DoD/TRICARE, and is at least as open and transparent a process (if not more so) than the DoD procedure. The DoD process automatically includes all medications approved by the FDA. It is up to managers to justify restricting access to a medication by removing it from the formulary, and this has to play out in a public setting with significant input from advocacy groups, medical societies, and other interested parties. VA should do no less for our veterans once they take off the uniform.

Short of this much needed comprehensive overhaul or transformation of the VA formulary, or perhaps while the Committee is working to draft and secure passage of this legislation, VVA recommends the following steps be taken immediately by Secretary Shinseki:

Change the performance evaluation criteria for Chief pharmacists to measure his or her contribution toward the overall wellness of the patients at a particular Medical Center. There are currently no such metrics in place, but they can be developed and these contributions measured, just like almost anything else. (Currently the pharmacists are rewarded by how much “cost avoidance” they can achieve in comparison with the national mean. This, of course, means that it is a “race to the bottom.” It is a testimony to the professionalism and commitment to good medicine by the pharmacists that, given the way the system is set up, with the emphasis on cost containment/cost reduction, that so many veterans do get the right medication in the right amount when they need it.)

The VA P&T Committee meeting schedule, therapeutic categories to be reviewed, and review criteria should be publically announced well in advance of P&T meetings.

The VA P&T Committee should establish a procedure to accept and consider public input for these Formulary meetings.

The VA P&T Committee should publish its recommendations made in the last decade with rationale for the conclusions and recommendations of the Committee.

The Secretary of Veterans Affairs should establish a Beneficiary Advisory Committee (BAC) of representatives from a representative sampling of major veterans, patient advocacy, and healthcare professional groups with the responsibility and authority to
make recommendations on the decisions of the VA P&T Committee including addition, deletions, clinical use criteria, and preauthorization requirements on drugs on the VA National Formulary.

Meetings of the VA Formulary Beneficiary Advisory Committee should be open to the public and the minutes and considerations of all BAC recommendations published on the VA P&T Committee website in a timely manner.

Like the DoD Beneficiary Advisory Panel, the VA Formulary Beneficiary Advisory Committee should include at least 12-15 members and have the opportunity to make
Recommendations prior to final decision on VA National Formulary changes and other
pharmaceutical issues. At least two of the following organizations should be included in the membership of the VA Beneficiary Advisory Committee, the American Pharmacists Association (APhA), American Society of Health-System Pharmacists (ASHP), Academy of Managed Care Pharmacy (AMCP), and American Society of Consultant Pharmacists (ASCP).

The VA Formulary Beneficiary Advisory Committee should have the authority to recommend to the VA drug categories and new drugs to be reviewed, changes to the criteria for use, clinical guidelines, restrictions on use, etc.

The Veterans Health Administration should be required to consider the recommendations of the VA Formulary Beneficiary Advisory Committee prior to making final decisions on VA Uniform Formulary including addition, deletions, clinical use criteria, and preauthorization requirements.


The Secretary of Veterans Affairs could do some, all, or most of the nine steps outlined here above within the scope of his authority. However, there will be stiff resistance on the part of VHA officials who like the status quo. All too often, some seemingly do not believe that they should be answerable to anyone outside of that closed system, much less individual veterans or veterans’ service organizations. These folks will have millions of reasons not to change, and perhaps so will some at the Office of Management & Budget (OMB). They also have their own constituencies around Washington who will tell the Secretary that it is “just too expensive” to provide expensive drugs to veterans. These individuals have had years of practice in “push back” to prevent any significant change being accomplished without legislation passing the Congress.

It is our belief that the time is right for this Subcommittee to take the lead in creating a statutorily directed formulary that is inclusive as a starting point, that is totally transparent, and that has to take into account input from stakeholders, both medical professionals and advocates outside of government. The VA continues to have great “bargaining power” to secure the best possible prices on each and every medication, and we believe that the private sector will be reasonable in this regard. In any case, it is impossible to say “Care Second to None” until we clean up this major problem with the VA formulary.

If we are going to assist the President to achieve transformation of the VA for the 21st Century, then there is no better place to start than ensuring full transparency in the VA formulary, and a presumption of inclusion of all FDA approved medications. And, for that, we need bi-partisan legislation and the strong leadership from this Subcommittee on this issue.

Thank you for your leadership in holding this hearing on a crucial subject, Mr. Chairman. I will be pleased to answer any questions, and look forward to working with you and your colleagues to greatly improve this vital service to veterans.




Funding Statement
September 22, 2009

The national organization Vietnam Veterans of America (VVA) is a non-profit veterans' membership organization registered as a 501(c) (19) with the Internal Revenue Service. VVA is also appropriately registered with the Secretary of the Senate and the Clerk of the House of Representatives in compliance with the Lobbying Disclosure Act of 1995.

VVA is not currently in receipt of any federal grant or contract, other than the routine allocation of office space and associated resources in VA Regional Offices for outreach and direct services through its Veterans Benefits Program (Service Representatives). This is also true of the previous two fiscal years.

For Further Information, Contact:
Executive Director of Policy and Government Affairs
Vietnam Veterans of America
(301) 585-4000, extension 127

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