Formulary Management from a Health Maintenance Organization (HMO) Perspective

Abstract

With the rise of managed care, formularies are being increasingly employed in the outpatient setting to manage use and control costs of prescription drugs. The formulary management policies of various managed care organizations are widely diverse and are largely dependent on the organizational structure of the managed care program. Although reasons for choosing certain types of formulary systems will be briefly explored, this article primarily focuses on formulary management tools used in the group model HMO setting. Various aspects of the formulary process that require ongoing management are described, including non-formulary drug usage, drug restrictions, drug use review, adverse drug reaction reporting, education of the professional staff, reporting of drug use data to physicians, and visitation by pharmaceutical sales representatives.