How Is It Pharmacy Automation Drives Budget Savings and Sustainability? Community Pharmacies

Category: Pharmacy Advances Written by Dr. Charles Shively / November 10, 2014

All Pharmacies Face Budget Cuts


As offered in Part 1 of this series on pharmacy automation and its impact on budget savings and promoting sustainability in the hospital sector, budget management in the community pharmacy sector diverges from the efforts for hospitals. The major difference?

Community pharmacies (particularly independent pharmacies) are focused on maximizing their profitability (net profit) through integrated workflow processes, prescription volume increase and products or services that support their patient's healthcare. Hospitals and their pharmacies look to maximize profitability through budget savings...prescription volume is already established...in contrast to most independent pharmacies which maximize workflow processes to create more time for patient engagement. How are these independent and other community pharmacies achieving successful budget management to increase profitability? For those who have read the first article in this series, the answer should be obvious: Pharmacy Automation.


Today's Challenges for Community Pharmacies


Pharmacies are improving their net profit through pharmacy workflow evaluation and implementation of technologies which support reduction of previous approach duplicative efforts by either pharmacists or technicians and the necessary time to complete many elements of the approval, dispensing and filling process. The ultra-challenge in many pharmacies is to reduce these time-demanding events which conflict with net profit opportunities...while improving patient engagement. What are these time-demanding events?


Any pharmacist today will offer (past the traditional "counting-by-fives"), that the enhanced efforts for MTM (medication therapy management), medication adherence programs and tracking (supports the 5-star ratings now demanded by PBM's (pharmacy benefit management systems), medication synchronization (efforts to provide all medications for a patient once monthly) and in some cases compliance packaging/counseling all add to the stress associated with needing "more time". Many pharmacy owners who have consulted with this author recall an earlier article about time needs..."Another Eight Hours Please"...and now would like another 12 hours per day!


Select independent pharmacies who have purchase automated dispensing systems and paired the system with integrated pharmacy management software to optimize pharmacy workflow have reduced the SWB (salaries, wages and benefits) impact on net profit by reducing pharmacist overlap hours and early arrival/late leaving hours of additional overtime to "stay even" with filling/dispensing volumes. These SWB savings are occurring while allowing pharmacists and technicians to meet the time consuming demands of improved patient engagement activities.

Yet Other Time Demanding Activities


A new area of time effort that has appeared during the past 4-6 months for pharmacy owners is the surprising effort demanded by daily "grocery-shopping" for best price for the generics they dispense. Working to find a balance between generic medication price increases and slowness by insurance payors to adjust patient co-payment and pharmacy filling fee reimbursement has today caused many pharmacies to dedicate a senior pharmacy technician to spending upwards of four (4) hours a day evaluating all needed medication purchases...generic or brand. Oddly, in many cases with the increased generic medication cost, brand prices for the same brand medication is cheaper for the patient/customer with the manufacturer sponsored discounts. A recent article in the Wall Street Journal (August 17, 2014) indicated over ½ of all generic drugs had a price increase with some reflecting a 1000% increase. One large pharmacy organization recently revised its expected annual earnings by 25% (a reduction of $1.2 Billion) due to prior contractural arrangements to provide generic medication to its Medicare and Medicare Advantage customers at specified prices (Wall Street Journal, August 20, 2014).


What's the Ultimate Scenario to Drive Net Profitability and Sustainability?


In recent consultations with new PharmD graduates who anticipate opening their own pharmacies, this author has offered several areas that must be included to improve patient customer service and engagement...and advance profitability and sustainability: They are:

- Fully integrated pharmacy management workflow software
- Automated pharmacy dispensing systems
- IVR
- Medication adherence tracking software
- Medication synchronization software
- ePA (electronic prescription prior authorization)
- Compliance packaging for their skilled and long term care accounts
- Mobile apps (preferably with two-way video)
- Text messaging to both cellphones and home e-mail for pickup readiness
- Telepharmacy efforts
- Patient portals which connect the pharmacy with area hospitals and physicians

Success today in community pharmacy is...I propose...a technology based endeavor. My... how times have changed.

SPECIAL THANKS to Tom Modeen, Senior Automation Specialist at RxMedic for his comments and insights into today's pharmacy issues.

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