We often want to pass on things we find interesting that are not worthy of a full-length blog post. For that reason, we have added a Twitter account to the Thriving Pharmacist. Follow us at @ThrivingRPh (sorry, the full name doesn’t fit twitter’s guidelines).
We will, of course, also tweet each new blog post there, too. Twitter also enables each of you the ability to forward us possible topics or articles, as well as continue any discussions or questions about previous posts found on the blog. So all of you out there that use Twitter, consider following the @ThrivingRPh. Make every tweet count!
Medication synchronization is a popular service offered by more and more pharmacies. The premise is two fold. One: create a convenience for your patients such that they only have to stop by the pharmacy once to get all of them medications. Two: allow the pharmacy to optimize its own workflow, as refills are now able to be scheduled like an appointment. This makes upcoming work load more predictable. The theory behind this would seem simple enough. In practice, however, synchronization is a little more challenging. Synchronization is more than just an auto-refill feature (offered by some pharmacy management systems). It involves actively validating all medications and quantities each sync period. This means a call to the patient and quick calculations of what the patient will need for the next sync cycle.
Medication synchronization at the very basic level is just a paperwork exercise. Simplify My Meds and other programs offer a paper based workflow to plan and execute synchronization. In our practice, after starting with a simple paper based system, it quickly became obvious that the operation could be very time intensive to the pharmacy staff. We realized that the process needed to be automated if we were going to move from a few dozen patients to a few hundred or even thousands of patients. There are a variety of vendors that now offer software services for synchronization. These allow the pharmacy staff to schedule and update each sync cycle. These software packages, however, are no better than the data that they extract from the pharmacy management system, and we have seen many problems arise with inaccurate or incomplete data being pulled by the vendor. This has resulted in our staff spending extra time verifying the data before synchronization can progress. The automated systems have the potential to save time, but until the data can be presumed accurate, we are still not optimizing our staff.
The workflow of synchronization ends on the prescription counter. On a given week, we are able to schedule the filling of sync patients during less busy times of the day because we know what prescriptions need to be filled several days in advance. Even with a reasonable barometer of pending workflow, we still end up congested on our prescription counter. The process could benefit from optimization. To do this, we need to speed our fill and check cycle, and robotics are an effective vehicle to accomplish both goals.
Rosie the Robot
Awhile back I wrote about our SuperSync program which leverages our Parata Pass robotic “unit dose” packaging robot. Our Pass-208 was named Phyllis (a play on the verb fill) was originally purchased to handle nursing home business. We have more and more patients that are electing to receive their retail medications using this method, and this has helped with our congestion issues. But as fast as the SuperSync patient base is growing, our sync program overall is growing faster. We had to make a decision: Phyllis is going to be a big sister. In the coming weeks, Max (a Parata Max) will be joining the family.
The symbiotic relationship between a robotic prescription filling robot and a med synchronization program is natural. The combination is so natural that currently Parata is offering a free year of the PrescribeWellness medication synchronization software when one purchases the machine. Using Max, our pharmacy can be actively filling med sync patients overnight, and the pharmacy tech or pharmacist can check the medications and get them to the shelf for pickup first thing in the morning.
Workflow Modifications
One of the more interesting discussions we had with respect to our workflow (working toward the upcoming installation of the robot) centered around our pharmacist’s CMM (Continuous Medication Management) program. Our normal workflow is:
[Intake] -> Data Entry -> Filling -> Final Verification* -> CMM -> Will Call
*In our practice, we are using a New Practice Model, which allows the Final Verification step for routine refills to be completed by a certified technician who has received extra training.
The CMM component for all prescriptions (regardless of the person doing final verification) must be done by the pharmacist.
In our discussions, our Medication Sync program starts with the pharmacist doing a reconciliation of the patient medications each sync period. Our workflow, therefore, could be modified to move the CMM to the beginning of the model along with the reconciliation done by the pharmacist:
CMM -> Data Entry -> Filling (overnight by robot) -> Final Verification* ->Will Call
This further decreases congestion on our counter as a significant number of prescriptions can be filled overnight and checked by a technician and moved directly to will call. The only issues are
how to segregate new prescriptions from refills at the robot level and
How to segregate Sync refills from non-sync refills
Both of these issues can probably be solved by minor modification to our clinical software system (PharmClin), which is used at the point of final verification.
Closing
While the OnePass packaging option (the Parata Pass 208) is gaining in popularity, we are also growing our regular sync customer base by leaps and bounds. Our goal is to have 30% of or customers on a sync program within the next 12 months. We have enrolled 150 new patients in the last couple of months and currently are at more than 250 sync participants. This change in our workload has lead to some issues with congestion on our prescription counter. Leveraging robotics in our workflow is one way we hope to enhance our workflow. The main goal, as always, is to be sure our pharmacists are free on the counter to perform CMM on every patient picking up prescriptions, making every encounter with the patient count.
I have heard a lot different angles (mostly negative) about certain narrow network Medicare Part D plans. These plans are somewhat exclusive, and many chains and independents were not offered, or declined contracts due to the very aggressive reimbursement offered. Some aspects of the overly complicated DIR (Direct and Indirect Renumeration) fees this plan leverages have been previously discussed on this blog here.
This specific plan is so polarizing in pharmacy circles that some pharmaceutical wholesalers even have come into our store bragging that their member pharmacies (represented by their PSAO – Pharmacy Services Administrative Organization) declined these contracts, essentially implying that stores participating in the narrow “Preferred” network were worse off having access to these lives. This is completely opposite of our feelings that access to lives is very important.
This specific plan reports DIR fees in a way that makes it very difficult to see bottom line reimbursement; the plan reports DIR fees retroactively, attaching last months DIR fees to unrelated claims on the current pharmacy remittance information. Up until recently, when our PSAO, AccessHealth, began matching the DIR fees associated with each prescription for us, analysis of profit and loss was almost impossible. With this report, pharmacies can take a closer look at how this contract impacts their bottom line.
Analysis
AccessHealth (and presumably other PSAOs that did not sign this contract) analyzed the potential profitability of this contract before deciding to sign (or not sign). The fact that AccessHealth did sign the contract indicated that it was their belief that member pharmacies would benefit overall from this contract, fully understanding the “aggressive” reimbursement and DIR fees would make it important that pharmacies maximize this access to lives by leveraging other revenue streams to make up for the lower prescription revenue. Using the data recently provided to our pharmacy, 872 claims (January thru March) for this plan were analyzed for their impact on our pharmacy. The question being addressed is this: is participation in this narrow network sustainable for a medium to large independent pharmacy.
General Statistics:
This plan represented 872 claims (Jan-March), each with an associated DIR fee
The total adjudicated amount for these claims was $66,855 before DIR fees
DIR fees were withheld from 568 of these claims totaling $14,694
“Negative” DIR fees (money returned to the pharmacy) were paid for 317 claims, totaling $2,020
Looking at these numbers, it is interesting to note that there were over 300 generic drug claims that were reimbursed at a MAC (Maximum Allowable Cost) that was BELOW the DIR’s contracted rate. This effectively gave money back to the pharmacy in the form of a NEGATIVE DIR. This “feature” of the DIR actually may help protect the pharmacy from some overly aggressive MAC prices for certain drugs. That being said, the withheld DIRs dominated these returned DIRs. The net DIR total for this plan in our pharmacy bottom line is about $4,000 per month returned to the plans in exchange for participation in the network.
Watching the Bottom Line (Profit or Loss)
Calculating profit or loss on a prescription is normally not that difficult, and it can be usually be done at the point of sale before the prescription leaves the pharmacy. The addition of DIR fees complicates this tremendously, because these DIR fees are unknown to the pharmacy until well after remittance arrives. The pharmacy may also receive a rebate on some generic products (based on the pharmacy’s purchase volume), though the pharmacy can usually estimate the rebate before it is actually received. Not every generic product, however, may be rebatable.
Once the pharmacy knows both the DIR and the rebate, a profit or loss can be calculated for each prescription. When a prescription is reimbursed by the PBM for less than it costs the pharmacy to purchase the product, is often described as “underwater.” For the 872 claims above, more than 90% of the prescriptions were generic. Other descriptive statistics for the claims include:
72 claims (8%) were “underwater” before DIR fees were applied to the claims
304 claims (35%) were “underwater” after DIR fees were applied
DIR fees averaged an additional 19% discount from the adjudicated claim amount
To a pharmacy owner, any underwater claims are unacceptable, and the large number of underwater claims for this plan is very discouraging finding. The more important statistic, however, is the gross profit or loss for these prescriptions, and applying the rebates should offset losses and have a positive impact the pharmacy bottom line. If the estimations done by the PSAO before signing the contract adequately reflected actual claims finding, the total profit for these claims should be positive.
Before generic rebates were applied to the above claims (but after the DIR fees were withheld), the pharmacy lost $6,552 on these 872 prescriptions. The amount pharmacy receives in generic rebates is variable (dependent both on the pharmacy’s purchase volume and the other contractual obligations), and for this reason, a range of rebate rates for generic drugs was calculated. For our buying group, rebates are calculated as a percentage of invoice price for qualifying items. This type of rebate application may not be representative for other buying groups outside the one which our pharmacies maintain membership.
For the purposes of this analysis, generic rebate rates of 20%, 25%, 30% and 35% were used. These calculations assume that every generic drug dispensed was eligible for a rebate. There are cases, however, where the least expensive drug (after accounting for rebates) is not a rebatable product. The assumption that all generic drugs were subject to a rebate may, thereby, overstate the effects of rebates on the pharmacy’s bottom line. The calculations below are then only estimates that should be representative of ballpark profit or loss on these prescriptions.
In the table below, the first line (Rebate Total) represents to total rebates (based on the generic rebate rate in each column) that the generic drugs included in the 872 claims should have garnered the pharmacy. The second row is the Net Profit or Loss for the 872 prescriptions based on the rebates received, and the last row represents the average profit or loss per prescription for each of the 872 claims.
Impact of rebates on the profitability of narrow network prescriptions
Several observations can be made from the table above. The most important, however, is that significant rebates are necessary in order to even break even on these prescriptions. While the disclosure of our generic rate is restricted by contractual agreement, I will state our pharmacy did not profit from these 873 prescriptions. I will further state that few if any independent pharmacies are likely to receive rebates that exceed 25-30%.
The distribution of the profitability of the claims is also enlightening. The chart below shows profit / loss ranges in $5 increments for all 873 prescriptions after subtracting the DIR fees but before rebates were applied. There are 78 prescriptions showing a loss of more than $25. On the other side of the histogram, only 48 prescriptions profited more than $25.
Profit Distribution of Claims before applying rebates.
After applying rebates, the histogram shifts to the right somewhat, but a large number of severely underwater claims remain. The histogram below represents a 25% rebate level (one that is assumed to be fairly representative for most independent pharmacies). The loss for these 78 prescriptions was between $8,500 (using a 20% generic rebate) to $6412 (using a 35% generic rebate). That is an average of more than a$95 loss per prescription. These prescriptions are not underwater, they reside at the bottom of the Mariana Trench. The total profit for the “highly profitable” prescriptions (netting more than $25) was between $2,698 (using a 20% generic rebate) and $2,720 (using a 35% generic rebate). The discrepancy between the heavily underwater prescriptions and the highly profitable prescriptions represents most of the losses recognized by the pharmacy.
Pharmacy Profit after applying rebates (25% rebate level).
The number if “highly profitable” prescriptions do not change much after rebates, with the $20-25 bin increasing only by 1 prescription. The most noticeable change is the number of marginally underwater claims (those $10 to $15 underwater). The number of claims losing more than $25 does not change significantly because these claims are obscenely negative. The group of claims losing more than $25 deserves further examination. The graphic below further describes the left-most column in the two histograms above. This one column is broken into 6 groups: losing $25-50, losing $50-75, losing $75-100, losing $100 to 200, losing $200-500 and losing more than $500. A seventh group (the far right columns below) entitled losing less than $25 was added to house any prescriptions moving OUT of the trench. Blue bars represent losses before applying generic rebates, and the green bars represent losses after applying generic rebates.
Effect of Rebates on Claims losing more than $25
The effect of rebates on these severely negative claims is small. The number claims losing more than $500 does not change after applying generic rebates. There is a small shift overall to the right in the other columns (indicating the positive effects of the rebates on these prescriptions), but only one prescription losing more than $25 before rebates actually “graduated” to a loss of less than $25. In other words, these claims are so far underwater based both on MAC and the DIR fee that even a very high 35% generic rebates cannot rescue them.
Looking closer at the drugs residing at the bottom of the Mariana Trench, several high dollar generic drugs appear to be the culprits. Looking at just one example, chlorpromazine, we see a claim for 186 tablets reimbursed at $595.18 minus a DIR fee of $336.67. Based on purchase price, the prescription started out underwater by over $1200. Because the purchase price is large, the rebate is proportional, resulting in $280 to $500 being returned to the pharmacy in the form of rebates. This still leaves the pharmacy between $650 and $900 underwater on ONE prescription. In fact, removing only 15 high priced generic medications from the analysis removes most of the 73 claims residing in “the trench”. If these claims were adjudicated in a fairly, the total of the claims would graduate from a net loss of $1791.65 to a net profit of $5161.23 (using a 25% generic rebate rate), which is a net profit of more than $6 per prescription. It would seem that the MAC and DIR calculations being used by this plan break down when generic drugs are very expensive.
Closing Remarks
It should be reiterated that the across the board application of rebates to all generics is an assumption, and that this will overestimate the effects rebates actually have on the bottom line of a pharmacy. That the bottom line is still red with this over-correction only emphasizes the need for reform.
Just breaking even on a prescription by the calculations above is not enough, either. No overhead costs were taken into consideration, and these are a significant part of a pharmacy’s expenses. It has been estimated that a pharmacy has to make an average of $9 to $12 per prescription to cover expenses (including a reasonable profit). The best case scenario (using a 35% rebate level) in the analysis above falls significantly short. This means that pharmacies need to find a way to make and additional $10-$12 for each prescription filled under this plan from OTHER services. Giving the patient a flu shot once a year, or selling the a bottle or two of over the counter vitamins 12 times a year is unlikely be enough to offset the significant losses these prescriptions currently bring to the pharmacy. I have always been a proponent of access to lives, but the above analysis shows that the pharmacy is paying the benefit manager a king’s ransom for the “privilege” of servicing these patients.
On a positive note, if the BPM were to correct their processing of a small number of medications (generic medications with very high acquisition costs) by correcting the MAC and /or and DIR components, the plan would draw considerably less ire from pharmacies and pharmacists. The concepts of MAC pricing and DIRs, if applied in a fair manner for all medications, might even be considered reasonable. The draconian manner in which it is currently being applied, however, creates significant problems. Pharmacies could address this problem by refusing to stock a small number of medications that are responsible for a majority of the losses being seen. It would be unfortunate if a shortsighted PBM’s policies resulted in a widespread loss of accessibility of certain medications to patients.
The ball is now back in the contracting organization (PSAO) to work with the PBM to address the problems outlined above. The current MAC and DIR calculation formulas appear to be broken for certain high cost generics, and this needs to be addressed immediately. Even if a pharmacy is not contracted with this specific plan, these tactics are becoming commonplace in the industry. Pharmacies need to be working closely with their contracting organizations to reform these tactics now. Normally I end each blog post by telling pharmacists everywhere to make every encounter with their patients count (a phrase so important that we even registered it as a trademark). Today I am asking every pharmacist to have an “encounter” with their PSAO. Make it count. Pharmacy is a great profession. Pharmacists bring significant value to healthcare. Reimbursement reform should be a goal every pharmacist works toward.
As a pharmacy owner, I tend to visit pharmacies (especially independent pharmacies) when I travel. There is a lot of history to be seen in some stores, and even new ideas to be hatched. While visiting an independent pharmacy in Little Havana (Miami Fl) that was right out of the 1950’s, it occurred to me that the front end (non-prescription area) of a pharmacy tells a story about the pharmacy and its philosophies. Immediately I recognized that even chain pharmacies are aware of this. Consider the recent national headlines generated as CVS announced that they would no longer sell cigarettes in their stores. Their rationale was simple: cigarettes are the polar opposite of health care. And while CVS is should applauded for this stance, the chain’s merchandise still includes many items that, while not as polarizing as cigarettes, certainly are not healthy or even related to health and healthcare.
Walking into any pharmacy tells a story. Today, the front end merchandise at many chains bears more resemblance to a grocery or convenience store than a pharmacy. I am sure that this merchandise mix helps draw customers and profits, but it has little to do with pharmacy. Save a few aisles of over-the-counter medications and health supplies, front ends of chain drug stores today are decidedly not health care oriented. Independent pharmacies are not exempt from this phenomena, either. Many smaller independent pharmacies have front end merchandise filled with gift, antiques, cards, and other sundries.
Part of this merchandise mix is tradition, part demographic, and part customer demand. Another part, though, is survival. Today, reimbursement for prescriptions is at an all time low. The pharmacy department historically was the revenue generating area of a store, with the front end almost an afterthought. Today, without strong sales and revenues from the store front end, both independent and chain pharmacies often struggle to generate acceptable profits needed to stay viable businesses.
Independent pharmacies today are at an even bigger disadvantage today than ever before. Independent pharmacies are generally smaller than chains. Their front ends are generally much smaller, too. The strategy being used by chains really does not translate to most independent pharmacies. For the independent, the story the front end tells must be different. For independents, the front end is becoming increasing health-care centered. This differentiation from chain drug stores is one part of how independent pharmacies are trying to survive in the market today.
Our pharmacies have emphasized the apothecary style store for years. Our front end is all health related, and includes the usual assortment of vitamins, wound care, laxatives and other over-the-counter remedies. Included in the merchandise mix is a healthy dose of durable medical equipment, including walkers, canes, crutches, and wheelchairs. Our philosophy is to make the pharmacist accessible, and our pharmacists are positioned on the counter in a manner that they can easily spot customers in the store needing help and quickly step into the front end to offer personalized care and answer questions. The image we want to project is a professional health center.
The next time you enter any pharmacy (chain or independent), take a look around and ask yourself: “what is the image that this store is projecting?” If you work for a pharmacy or even own one, ask your customers the same question, and they ask your self if that is the image you want to project.
Sometimes I lament that, as a pharmacy owner, I don’t get to spend as much time on the prescription counter working with patients anymore. I still enjoy the challenge of working on the counter and working with patients, and every day I spend in this capacity I see examples of how pharmacists bring real value to healthcare. I also regularly find examples demonstrating the importance of taking time with each patient to be a clinical interventionist. I wanted to share a recent encounter I had the other day, because it emphasizes one of the core tenants of the Thriving Pharmacist: making every encounter with the patient count.
Today, while doing routine CMM (Continuous Medication Monitoring), I noticed that a medication had not been filled in several months. Our clinical checking system (PharmClin) helps our pharmacists easily spot these types of problem in two ways. First, the system calculates compliance (as a PDC — percentage of days covered). When the PDC drops below a pre-set level (around 75%), the software creates an alert for the pharmacist. It is important to note that this is done for all medications each time the patient record is visited and without regard the the medication(s) being filled and checked on a given day. The second feature of PharmClin that is immensely helpful is the ability to document if problem (like compliance of a medication) has or has not already been addressed. It also allows the pharmacist to set a follow-up date for re-evaluation of the issue.
In the case today, this medication had dropped to a compliance rate of 75 percent three months ago. The PDC was low due to one late refill, the pharmacist note on that date indicated that we would continue to monitor the compliance and revisit it in 3 months. It is not uncommon compliance to rebound, and 90 days is a reasonable amount of time to observe and re-assess. Today the software once again alerted me to the compliance issue (the three months had now elapsed). Given both the worsening PDC and the previous course of action (simply to monitor), I generated an intervention and attached it to one of the prescriptions being picked up today. The note simply asked if the dosage of this medication had changed or if this medication had been discontinued. The pharmacist speaking with the patient at the register would then be able to collect any important details (why, side effects, ineffective etc.).
When the patient arrived this morning, the technician (seeing the intervention tag) called me over to the counter to speak with the patient. During the course of discussion, I was able to ascertain that while the medication was indeed working for him, he was not currently taking it due to a drug interaction. Not seeing any drug interactions noted in his profile, further inquiry was made. It turned out that the patient was receiving a mediation from the local university teaching hospital. This medication (Harvoni) did indeed have an interaction with the medication in question.
At this point, I was able to speak to the patient about the importance of a single pharmacy home, and making sure that that pharmacy home has a complete profile. As it turned out, the patient had simply assumed that we would know what the other pharmacy dispensed. If a new medication was prescribed that also interacted with Harvoni, we very likely would not have been aware of the potential for an interaction. After the patient left, I added Harvoni to his profile for inclusion in future screening during our CMM activities.
The intervention that I had with the patient today was not uncommon to pharmacy. Pharmacists around the country take the initiative to be clinical interventionists. It doesn’t take board certification, a residency, or a fellowship to be a successful interventionist. It takes a sound workflow and an desire to think and ask questions. The biggest difference for me, though, is the documentation being done by our pharmacy. Documentation, like the previous note and the alert for a follow-up, allows the pharmacist to continually refine the clinical picture for each patient and the plan of care. Software is an important part, and can enable the pharmacist perform and document meaningful CMM activities.
Recently, I spent over one hour to resolve an issue that should not have taken nearly as long as it did, nor should have been a problem from the start. It had to do with a patient who needed blood glucose strips filled. This patient uses an insulin pump, so she must check her blood sugars 7 times per day. The patient’s physician had completed the prior authorization paper work and the patient did receive a letter from the PBM indicating that the strips had been approved for coverage. And yet, when we went to fill the prescription, it got rejected because the product is an OTC. The PBM was called and their representative basically read to me the rejection that I was already seeing on the computer screen. So when I explained that the patient received a letter from them specifying that the strips are covered, the representative put me on hold and had to check her sources. After some time had passed, the PBM representative came back on the phone to tell me that they cannot provide this override as it has to come from the plan because it is an OTC (Over the Counter) reject. She then proceeded to tell me that I had to call the plan specifically as they would have to approve the override and she gave me the plan’s toll free number. WHAT?! The letter came from them (the PBM) to the patient, not from the plan! The PBM representative insisted that this type of reject has to be overridden from the plan. I repeatedly asked the PBM representative if the information on the strips could have been coded wrong, but she said, “No, it had to be overridden by the plan.” So I proceeded to call the plan.
The plan representative was confused by my call. She asked me if I had reached out to the PBM, and my answer was YES! I told her what the PBM employee told me, and this just added confusion to the plan representative who said she would have to put me on-hold. After some time she came back on the phone and she asked me to re-run the claim so she and another plan representative could see the reject. Once I ran the claim, both representatives were now perplexed on why the claim would not go through. The plan representative put me on-hold again and said she needed to do some more checking on why this claim was rejected. After some time, someone at the plan hung up on me. After some more time passed, I did get a call back from the plan representative who was very nice and helpful. The plan representative informed me that the error was on the PBM side; they had coded the information incorrectly from the start. Hmmmm!!! This is what I asked the PBM representative previously. So either the PBM representative was lazy, misinformed, or not trained properly to check or identify if the transaction was miscoded. Luckily, the plan representative was able to get into the PBMs system and make the necessary correction, and the claim did go through.
So, for those pharmacists who deal with these type of issues on a daily basis, they know exactly what I am talking about and the frustrations with these type of calls. This happens way too often and provides no value to anyone. The complexities of the system created by the PBM are even beyond the PBM’s help desk employees, and even they could not help us correct the issue they created. And who’s paying us to correct errors like this for them? Community pharmacists are being bombarded with underwater MACs, DIR fees , clawbacks, and insufficient reimbursement for many medications. And yet we are the ones who not only provide clinical services for our patients, but also resolve these claim processing errors.
If pharmacies are charged a fee by the PBM for each and every claim they submit to be processed, should not the PBM’s have to pay pharmacies for their work helping patients achieve their therapeutic outcomes–even if its to resolve processing errors made by the the PBM? Indeed, if it were generally known how much time pharmacies spend working on PBM generated problems like this, they would likely be appalled. If the federal government has rules to reduce burdensome paperwork, should not the contracts signed by pharmacies (and on their behalf by their PSAO) have language that covers time wasted by the phararmacy on the behalf of the processor. In this case, a pharmacy technician would have cost the pharmacy about $30 in time. Where should we send the bill?
This is a open call out to all contracting organizations representing pharmacies (chain and independent). As our partners, stand up for us. Emphasize the value of pharmacies in assisting patients navigate the difficult world of the pharmacy benefit. Help the PBM industry respect our time and efforts. In the past, reimbursement for product helped offset pharmacy hours spent working these types of problems. Current reimbursement no longer allows pharmacy this luxury.
Remember, from the beginning, this was a clinical issue. A patient with diabetes, with an insulin pump, requires testing above “normal” test strip usage. All of the obstacles were administrative, and in no way helped the patient. It took the pharmacist to uncover the convoluted mess created by administrative policy and clerical error. It is always about the patient–let’s not forget this, and this needs to be emphasized to payers and PBMs!
Whenever visitors tour our pharmacy, one of the most common comments has to do with the level of our staffing. We typically have a minimum of 4 pharmacists working on any given day, with as many as 7 on select days. The use of extra pharmacists (what we call our slack resources) allows the flexibility to accomplish many ventures other “stripped down model” pharmacies cannot. This article will describe our workflow and the benefits it brings to a pharmacy practice.
Technician Driven
The most important part of our workflow is freeing the pharmacist to focus on the patient. This is accomplished by leveraging excellent technicians to do all data entry and filling processes. In our case, our pharmacy is involved in a pilot project allowing technicians that have received additional training to check refill orders without a pharmacist final verification of the product.
The Pharmacist Belongs on the Counter
Another important philosophy in our workflow is that the pharmacist needs to stay in the dispensing workflow. Even if the pharmacist is not doing the final verification step (for example, in the tech check tech pilot program above) the pharmacist is still reviewing the patient’s profile and clinical record in real-time. The pharmacist is tasked with creating and documenting interventions that need to be addressed with either the patient and / or the prescriber. By being on the counter, the pharmacist is accessible to gather information directly from the patient as needed to make clinical recommendations.
The pharmacist on the counter has one of the more difficult jobs in our practice. Their responsibilities include:
Final Verification of the drug product (all prescriptions, or for new prescriptions if a tech-check-tech program is in place)
Clinical profile review. Each patient’s records are reviewed any time a prescription is filled or a patient contacts the pharmacy with a concern or question.
Identify issues that need to be addressed at the point of sale (compliance, high risk medication use etc) and flag these for follow-up with the patient
Gather patient information specific to any issues identified
Document the additional information gathered
Schedule appropriate follow-up as required
Contact the prescriber by phone or fax regarding any problem(s) identified as needed
This is a significant amount of work to put on one person, and when the pharmacy becomes busy, this pharmacist needs a resource to delegate work. This is our slack pharmacist.
The Slack Pharmacist
It is important to develop a workflow that leverages this person to maximize their impact. It would be inefficient to have this resource sitting and waiting for the hand-off from our prescription counter. Our slack pharmacist’s responsibilities also include medication reviews for our patients residing in nursing homes we service, and our assisted living community patients. They are also involved in vaccination programs and other clinical services like cholesterol screenings, site visits and our medication sync program.
Our slack pharmacists are located a few feet from our prescription counter, in semi-private cubicles. This workspace allows the slack pharmacist to work individually with a patient, and to have ready access to the clinical records system and many of the other tools they use (blood pressure cuff, Cholestec machine, immunization supplies, injection supplies, patient charts etc). This proximity means that the counter pharmacist can easily hand-off patient care activities, SOAP note completion, physician calls and faxes during a busy time on the counter.
Pharmacists Enable Care
If it isn’t obvious by now, our practice places a significant emphasis on the talents and capabilities of our pharmacists. What visitors notice immediately after they count the number of pharmacists at our practice is that every single pharmacist is quite busy. Taking care of patients is not possible if you don’t have the resources available, and simply filling prescriptions is not patient care. The pharmacist has excellent access to their patients, and they need to capture every encounter and make it count.
On a recent conference call, we learned that a significant Medicare Part D plan would NOT have any clinical opportunities for pharmacists in 2016. This is disappointing on many levels. The fact that Medicare will allow a plan to do this is troubling, especially with the increased lip service being paid by Medicare with respect to quality measures.
Pharmacists should be upset by this, but there is another facet to this that is equally troubling: Medicare Part D plans are not searchable based on clinical services offered. While the Medicare.gov plan discovery tool does display the presence of an MTM program it is not prominent and does not adequately describe the program’s context or extent (see the example below). These omission are significant, especially given the emphasis on quality being touted by Medicare. If a patient considers their local pharmacist to be an important part of their care, and desires to have clinical services (locally provided by their pharmacy) included in their drug plan, they are adrift with little guidance.
While it is possible that Medicare may eventually include clinical opportunities as a searchable term, and / or make differences in how the services are provided more obvious to the end user, it may come down to companies like iMedicare to fill this void in the near term. This company can be used by pharmacies to quickly help their patients choose a plan based on the same information used by the Medicare.gov website. If iMedicare supplemented the information already being provided by Medicare with a description of MTM and clinical opportunities for the given plan, it would allow pharmacists to explain which plans include this important feature. These details on how each plan handles MTM are very valuable, as some plans do not use local pharmacists to perform these clinical services, or severely restrict the number of patients that are eligible. Given this additional information, patients would have a more complete understating of plans and could then make better decisions about their Medicare Part D plans
The Pharmacy Benefit Manager (PBM) industry has gone from being a claims processor (simplifying paying claims for the insurance payor) to a manager of the entire pharmacy benefit for hundreds of millions of patients. Is not uncommon for a PBM to tout the savings they garner the system thru their management of the drug formulary, restrictions on expensive medications, and a variety of processes that come close, or even cross the boundary, between the PBM being a “manager” and the PBM acting as a physician or pharmacist.
The PBM industry generally takes credit for saving the health care system billions of dollars yearly. But being a pharmacist, I often have wondered how much of these “savings” are due to the PBM itself, and how much is directly attributable to the actual care providers. I find it interesting that the PBM industry is a pure middle-man in the health care industry. As an industry, they have very little on the line as they are not generally responsible for the total health spend. Manufacturing savings for the PBM may be as simple as creating downward pressure on the price paid for product and services. The PBM can effect savings in this manner without actually jeopardizing their own bottom line significantly. While the above characterization is certainly not complete, it does represent the essence of the entire industry.
Quality emphasis
CMS and others are beginning recognize that the current system places too much emphasis on product and not enough on service. Recent initiatives are starting to emphasize quality of service in the equation, and these measures are NOT something that a manager can do themselves. They require the providers (and in this case these are pharmacists) to accomplish. Pharmacists are key because they actually can see, speak to, and evaluate the patient and their medication use. Recently, some PBMs have even taken steps in the right direction and initiated programs to reward pharmacies for high quality work. While these initiatives emphasize metrics that are simplistic (mostly measuring compliance), and the actual financial rewards are not at levels that could sustain high quality performance in a pharmacy, they are steps in the right direction.
Pharmacist Impact
Pharmacists can have significant impacts on savings in healthcare. Our own pilot study that included 600 patients with a local payor is showing significant savings effected by pharmacists acting as clinical interventionists. These savings, calculated by the payor using a rigorous statistical analysis, show that a pharmacy can save the health care system several thousand dollars per patient per year.
Now the US Army is reporting similar results; using pharmacists as interventionists can create significant savings and a positive return on investment. And this type of evaluation is starting to catch the eyes of payors. In Iowa, the payor involved in our pilot is looking to create a network of high performing pharmacies by next year (2016), and that network would be paid using a different model than the one currently used in the industry.
Changing Times
The current iteration of the Star Measures are simplistic, but they are a good starting point. We fully expect that the Star measures will evolve to include actual disease state outcomes and measures that better reflect the savings in total health spend. These changes are not compatible with the current PBM centered “manager” model. A PBM cannot manage patients in this manner, only a provider with face-to-face access to the patient can do this.
Increased emphasis on outcomes means that the PBM, who does not have any skin in the game currently, will either become less important, or will need to shoulder more responsibility for the outcomes of the patient. Either way, the days of easy profit as a middle-man may be numbered. The current methods leveraged by the PBMs to create a stripped down model of pharmacy will not improve outcomes. The cheaper drug does not necessarily mean better healthcare outcomes and a lower total healthcare spend.
These changes have significant implications to pharmacists and pharmacies that have adopted the stripped down model of pharmacy. Going forward, it will not be enough to simply fill a prescription. It is what is done after the prescription is filled, that time spent with the patient, that will become important. Pharmacists need to rediscover their inner clinician. Those skills learned in pharmacy school will need to be polished and practiced once again, for many, for the first time since graduating pharmacy school. Pharmacists need to start stepping up their games now. Start making every encounter with your patients count!
The Future
Imagine a future where it is the pharmacy that has negotiating power. A payor will negotiate with a high performing pharmacy to have them included in their network. Pharmacies and pharmacists are paid for the care they provide based on real clinical outcomes. Savigs effected by pharmacy and pharmacist are shared with the pharmacy and pharmacist. A vision like this is possible, and it is a far cry from where pharmacy stands today, begging to be included in narrow networks with impossibly thin margins. In order to get there from here, pharmacists need to start now.
The other day, my business partner and I had a conference call with our wholesaler and our PSAO about the impact that DIR fees were having on our bottom line. The representative from our PSAO kept emphasizing that the reason why they signed the contracts with some preferred networks (with very low pharmacy reimbursement) is because they wanted to make sure that their network of pharmacies had access to lives. We do not disagree with this statement, but where our priorities began to diverge from our PSAO is when the PSAO representative described ways to increase revenue for those patients in the store. The emphasis was on selling them other items to make up for the losses on the drug product. The emphasis was not on clinical services, but what other products you may be able to offer patients coming to your practice.
What?! We were in disbelief! From our perspective, access to lives means that we have an opportunity to provide clinical services that impacts the care of these patients. If clinically we did our job, then patients should attain their therapeutic outcomes through safe and effective drug therapy regimens. Those patients who achieve their therapeutic outcomes should be healthier and have less health care spend than those patients who do not achieve their therapeutic outcomes. It is our contention that pharmacists SHOULD be paid a FAIR fee for high performance. Obviously, with underwater MACs, DIR fees, claw-backs, and other PBM business practices, the payment for product has rapidly become insufficient to cover the costs associated with dispensing. Product reimbursement certainly leaves nothing to pay for a pharmacist’s clinical activities and cognitive services. To add insult to injury, the performance payment from one PBM for our performance on pharmacy performance measures was extremely anemic. This is unacceptable, and as a profession we should demand more from our strategic partners, which include our wholesaler, our PSAO, our network, our buying group, and the PBMs themselves. At this point, the partnership seems to be benefiting everyone but the community pharmacist who is in the trenches taking care of patients (and who is getting paid less to do this). It makes no sense. But to have one of the strategic partners verbalize that we have to do more than just offer clinical services and look at other products that we can sale to patients as a way to enhance our revenue was enough to put us over the edge.
We want to be good community pharmacists. We offer an extensive list of clinical services. We have partnered with a local payer, who has stayed committed to us because of the outcomes we have been able to generate with their clients (our patients), and we consistently achieve a high performance on our pharmacy performance measures on the EQuiPP platform. We own two professional pharmacies that have small front ends. We only sell medical related items and we already have a flourishing DME business. So if our strategic partners are suggesting that we are suppose to sell paint and hardware or milk and eggs as a way to generate new revenue, then question if they are truly our partner. It should be about patient care. It should be about the services we provide. It should be about the outcomes we achieve. We have worked hard to change the paradigm of our practice, but now we are working just as hard to change the paradigm on how community pharmacist are paid. It seems everyone within the drug distribution system is “making their money” including the all the strategic partners that have been mentioned previously, but the community pharmacist is left to provide the care, identify and resolve drug therapy problems, take calls from patients 24/7, be responsible for patient outcomes, and not paid sufficiently for any of it. Access to lives should not be about finding new ways of selling products to improve the bottom line, but rather it should be about quality patient care, fair reimbursement for that care, and bonus incentives if expectations are met. How can anyone rationally look at the current system and say that it is fair and that pharmacist are reimbursed sufficiently? The financial viability and survivability of independent community pharmacist is on the line.
As we move forward, we will continue to fight for what we believe is fair reimbursement for services rendered. We will continue to put pressure on our strategic partners to help us in our quest for fair and equitable reimbursement. In the short term, we also will continue to put pressure on our strategic partners to make sure that we are receiving the best price for our costs of good sold, including rebates. We will continue to communicate with our legislators about fair reimbursement for pharmacists. And we will continue to support our local, state, and national professional organizations as they continue to fight for pharmacists recognition as providers. It has been a tough year, and next year looks to bring the same. We also realize that we are not alone, as other owners have expressed similar concerns. All of us can make a difference, but we have to be willing to challenge the status quo and our help strategic partners to change.
