Month: March 2020

Recently I received a call from a person who had a walker they received from the Veterans Hospital. The walker had a broken cable, and they wanted to know if I could repair it. Having done a fair amount of work on bikes over the years, I agreed to take a look.

The next day he presented to the pharmacy with his walker. After taking a quick look at it, I determined that the manufacturer went out of its way to prevent simple cable replacements. It was designed to require a new hand brake set from the manufacturer: there was not a way to anchor a standard cable to the brake mechanism.

I am not one to shy away from a challenge. I had a cable and a casing in my toolbox so I went ahead and started the repair knowing that I was going to have to improvise. I spent a lot longer making the repair (30 minutes) than I would normally budget, but in the end I did manage cobble together a solution. The brakes worked and I was confident that they would hold.

I took the walker back out the waiting area and presented it to its owner. He was not one of my patients. Because he was a veteran, he receives his medications and other needs from the VA Hospital. He was very happy to see his walker functional again. I spent some time chatting with him. After a bit, he informed me that he was one day shy of his 99th birthday.

After a bit, he asked me what he owed me for the walker repair. I have always maintained that pharmacies should always charge for their service. To give service away minimizes the pharmacy’s contributions to health care. But in this case I made an exception. I thanked him for is service, helped him out of his chair, and sent him on his way. Today, he made HIS encounter count. I was proud to just have met and talked with him.

Back when my father-in-law first went to work as a pharmacy student, there were no fewer than 4 different independent pharmacies in downtown Iowa City, Iowa. There were numerous other independent pharmacies in the area, as well as a few different local and national chain pharmacies. Pharmacies were local businesses. Each pharmacy primarily serviced its immediate area in town. If you lived in one part of town, you were very likely to utilize one of the apothecaries nearest to your home or work.

Today, we are one of the only remaining independent pharmacies in the area, and chain pharmacies are on most every major intersection. More importantly, we have entered a very different era in pharmacy. While there are still a significant number of pharmacies in Iowa City, we also have a large number of other pharmacy competitors: mail order and internet pharmacies have proliferated wildly in the past few years. None of these competitors reside in our area.

This very fundamental change in our competitive landscape makes it important to ask ourselves an important question: are we, as an independent pharmacy, ready to compete with pharmacies that do not even have a local presence? Or, to put it another way — does an independent local pharmacy want to compete, and how does it do this?

These are not easy questions, and there is no one right answer. Because many of these newcomer pharmacies offer services like compliance packaging, something that we have used as a competitive advantage for years, we must compete. We must have a plan.

We decided awhile back that we could not let zip code define our pharmacy. In today’s market, our reach has to be far broader than it has ever been. Before we serviced patients in a 5 mile radius. If we are to compete today, our service area needed to grow at least by a factor of 10.

To accomplish this, we expanded our delivery service. We went from one vehicle and a part-time driver, to having two vehicles and multiple drivers available. Before, a long delivery was 10 miles round trip. Today, we routinely will make deliveries 50 miles away or 100 miles round-trip. We also still leverage mail and parcel services for less time-sensitive needs, or where it makes more economic sense.

This increase in service area has, of course, increased our delivery and postage expenses. For delivery, if you use a rough approximation of delivery costs at $0.58/mile (the standard IRS mileage rate for 2019) and add in salary plus fringe, our per-delivery cost works out to $5-7. This may seem high, but in fact it is a value if you compare it to postal or parcel services. USPS Priority Mail Flat Rate pricing starts at $7.50 and goes up from there. Local delivery has the additional advantage of being more prompt: same day service beats even Amazon’s best delivery options in my area of the country.

One note on our delivery service: we offer free delivery. For this reason, we have to put some reasonable restrictions on delivery so that we are not delivering one item to a location 5 different days each week. We delivery at no charge to a given patient once a week. Additional deliveries are billed at $5 each unless the reason for our repeat delivery is due to issues on our side. This has been a nice compromise for our patients, and it helps optimize our deliveries as well.

There are two main upsides to expanding your zone of influence your pharmacy maintains. First, you can more easily maintain your current customers as you can meet or exceed expectations of the new competitors. Second, it opens doors to new customers that were previously outside your zone of influence.

Additionally, delivery has an additional and significant potential bonus for a pharmacy. Our drivers are our employees, and they are directed to be observant. When they deal with a patient, they are to assess if there has been any notable changes since their last visit. This allows us to become alerted to social determinants of health issues, or other health changes in these patients and potentially refer the patient to help if needed.

In our case, our willingness to expand our zone of influence has gained us many new patients we previously would never have seen. Each patient has not only potential prescription revenue, but they are also a new target for our other services and offerings, many of which are more profitable to our business than prescriptions alone.

All of this has happened without us actually advertising our extended service area. Admittedly, a lot of this is because we are well known regionally for some of our unique service offerings as well as our overall customer service. In fact, this has actually created a few problems, as we are now receiving solicitations to service customers that are outside of our state. If we wish to service these customers, we will need to license our pharmacy into additional jurisdictions.

Expanding your pharmacy’s zone of influence outside of your zip-code is something all independent pharmacies need to consider. It is an opportunity to pick up profitable new opportunities. It is just another way to Make Every Encounter Count!

Back in February, Managed Care Contributing Editor Joseph Burns wrote an article about Express Scripts (ESI) and their attempt to branch out behind its traditional Pharmacy Benefit Manager role and foray into managing overall health for a select group of companies. This appears to be a response to ever increasing pressure for transparent PBM contacts, and the idea has merit.

The companies trying this approach with Express Scripts are trying to remove some of the financial incentives that have traditionally been hidden in PBM contracts by negotiating a more transparent contract. They have, however, taken it a step further, looking to manage not only drug spend, but also to decrease overall health spend.

Express Scripts has spent the last year working with these companies trying to improve outcomes in disease states like diabetes and asthma, as well as some more specific areas desired by the employers. This is a significant change to how they have traditionally done business. This, of course, required that they make some changes.

Under the contract, Express Scripts hired population health managers to do daily monitoring of employees to identify gaps in care such as screenings or tests that are recommended for patients based on their age and gender. It also has hired academic detailers to educate prescribing physicians about the evidence of the clinical effectiveness of the most appropriate medications for each patient

Snezana Mahon, Express Scripts vice president of clinical programs

The project appears includes more traditional financial performance guarantees designed to decrease per-member-per-month drug dispensing in addition the new features included in a per-member-per-month administrative fee to implement the clinical program. This is an at-risk model. If the PBM fails to meet the metrics for either program, the company forfeits some or all of the additional fees. If they succeed, the are rewarded with a bonus.

The inclusion of clinical programs targeting things like Hemoglobin A1c levels for diabetic patients, and blood pressure for hypertensive patients is a good start. The savings potential on drug spend continues to diminish. Pharmacies are being paid rock-bottom for the drug product and the PBMs, while they unquestionably mark this up, have precious little room to further reduce drug spend. The potential savings on the medical spend is both a much larger, and a more productive target.

What is being attempted, however, is not a new or novel concept. These types of programs are have been, and are currently being implemented by community-based pharmacists around the country. Engaging community-based pharmacists who, not only have therapeutic relationships with patients (pharmacist-patient relationship), but also a collaborative working relationships with physicians and other providers, has positively affected patient care and health outcomes. It is through these relationships, and a team approach, that patients become engaged participants in their own health care leading to improved health and overall reduction in health care spend.

Additionally, community-based pharmacists are accessible to patients and can assess them for social determinants of health (SDoH) issues that may be affecting their access to medications. If an SDoH issue is identified, community-based pharmacists are integrated within their communities and can connect patients to the appropriate community-based organization (CBO) or social services department.

Utilizing pharmacists out in the community to manage and optimize drug therapy has been shown to significantly decrease overall health spend measured per-member-per-month. Using pharmacists in call-centers, as a PBM would do, may help move the needle some, but the real force in healthcare is in the trenches: with the pharmacists and pharmacies that already have a relationship with the patient.

Community-based pharmacists are better potential partners to accomplish the type of savings in health spend mentioned in the article. Local and national high-performing networks of pharmacies already exist around the country. These networks have already proven that they can move the needle to save on health spend. These networks have significant advantages over a PBM administered program because they use highly trained, local pharmacists who already have relationships with the patients and local providers. Pharmacists that are able to work personally, face-to-face with the patient.

This project mentioned in the article is exciting. It means that pharmacy’s attempt to transform the profession is working. We need to continue to push forward. We have an opportunity to remove pharmacy from the grips of the PBM industry if we can continue this movement. It is time to Flip the Pharmacy (FtP). Flip your pharmacy and Make every encounter count with your patients!

During the last part of 2019, like every year in the last decade, I spent many hours each week working with patients to determine the best Medicare Part D plan for them in the upcoming year. Open enrollment is an important event for the those eligible of Medicare Part D, but it also has significant implications on the pharmacy as well. For this reason, we actually leave signs up all year long letting people that we can help them navigate this yearly task.

Medicare Part D is very complicated. I hear my patients lament its complexity constantly. It is no wonder that many regularly seek help with this process. A successful open enrollment for a Medicare Part D participant typically is a balancing act between ensuring that they are getting the best total out of pocket costs for their medications and ensuring that they continue to have access to the pharmacies that they want to use.

There are a number of resources available for Medicare Part D enrollee to use during open enrollment. The most obvious is the Medicare.gov website. This site aggregates the data from all of the plans and allows one to compare available options. Unfortunately for everyone, while the site has done a good job making the process as smooth as possible, there are still a number of challenges: the complexity of the task cannot be fully masked by a good user interface. Something as simple as searching for your specific medications on the site, for example, is often confusing to someone without a detailed knowledge of medications.

These difficulties are further compounded by the occasional inaccuracies in the data being loaded by the plans. Several times in the last few years we have found incorrect copays on drugs, or pharmacies listed incorrectly as participating or non-participating on the Medicare.gov site. The data the tool uses is provided by the plans, not Medicare.

It is important to point out that even a savvy enrollee with a good understanding of Medicare Part D and their medications may not be fully comfortable working with this fairly complex web tool. Even these consumers will seek outside help. Family members, insurance agents, and volunteers regularly assist enrollees every year. But all help is not created equal: there can be significant differences in the experience and expertise.

This might be self-serving, but the in my opinion, the best resource for help with Medicare Part D is a pharmacist or pharmacy technician. They have daily experience with the complexities of these plans and have the dded advantage of understanding drug therapy and medications. Pharmacy employees can help patients pick plans as long as they follow the guidelines set up by CMS: they cannot direct a patient to a plan based upon financial benefit to the pharmacy. In other words, we have to be completely transparent when we do this.

When I help an enrollee, I first establish the patient’s choice of pharmacy. My motto has always been to choose the pharmacy first, the plan second. This will limit which plans they see listed, but before we finish we will compare other pharmacies. Because I work with the medications every day, correctly selecting the patient’s medications is not a problem. If they are a current patient, I have access to their medication list. If not, I spend a few minutes collecting a medication history (just like if I were doing a clinical review).

This gives the enrollee their first look at the best plans available for them. The plans that save them the most money are typically plans in which the patient’s choice of pharmacy is a preferred provider. After looking at the best options for their choice of pharmacy, we then go back and use a different pharmacy to perform the same search again. The second pharmacy is chosen explicitly because it has one or more preferred contracts that the patient’s first choice of pharmacy does not have. Alternatively, the search can simply omit pharmacy choice altogether. The result of this search allows the patient to see other plan options, albeit options that would necessitate them changing pharmacies.

This second search also demonstrates a general trait of Medicare Part D plans: out of pocket costs for a given patient and plan are very similar when using a preferred pharmacy. Stated another way, if a pharmacy is a preferred provider for one or more plans, using another pharmacy and a different plan does not impact total out of pocket expense significantly.

It should be apparent that the analysis I do with may patients enrolling in a Part D plan is meticulous. We discuss the plans they are considering, including looking at star ratings and plan policies like mail order. They are shown all of the options, including a look to see if switching pharmacies would save money. Fortunately for me, because we have a few preferred plans each year and we have not lost a customer for this reason. Even more satisfying is the fact that almost every customer I work with is adamant that their number one concern is maintaining their choice in pharmacy providers.

Fallout

Every year I have upset patients calling me. For whatever reason, they used someone else to help them pick their plan. Inevitably, they are surprised by a higher than expected copay, a non-covered medication, or the fact that their preferred pharmacy is NOT a preferred pharmacy under the plan in which they enrolled. They are stuck, even if they were given bad information from the Medicare.gov website!

Unfortunately, there is not an easy fix for these errors. Open enrollment happens only once a year. Changing plans between companies is not currently possible. Even changing plans within a given company is not possible. Every year I lose a few patients to these errors. Every year I also gain back some patients that learned their lesson the previous year. The end result is frustration for both the patient and the pharmacy.

There may eventually be some recourse. According to this report, there is a push from several US Senators to create a “special enrollment period” for Part D for just these types of problems. I know that if this happens, I will have fewer unhappy patients when January arrives.