As reimbursements continue to shrink, profitability is a growing challenge for pharmacies across the country. Luckily, there are many opportunities for pharmacies to evolve their business to stay in line with, and lead in, a changing marketplace.
Many pharmacies are now offering differentiated products and services designed to attract new business, provide alternative sources of revenue, and most importantly, offer value to the patients they serve.
Discussing diversification of pharmacy practice and revenue streams causes many to raise eyebrows, and for good reason. We have been talking about new opportunities—from medication therapy management and direct patient care, to team-based collaboration and ambulatory care—for decades, with no substantial change.
The current challenges in the marketplace—falling reimbursement, increasing costs, and intensifying competition—paired with growing opportunities through changing state and federal laws, have escalated those discussions and primed the landscape for growth and diversification. Opportunities for change include point-of-care testing, clinical trial recruitment, and pharmacogenomic testing. Medication synchronization is another opportunity for growth and differentiation.
Opportunities for Change
1 Point-of-care testing
A pharmacy’s ability to legally complete these tests depends on some state restrictions, and the Clinical Laboratory Improvement Amendments (CLIA) waived test systems, available through the US Food and Drug Administration,1 the Centers for Medicare & Medicaid Services,2 and the Centers for Disease Control and Prevention.3 Several of these tests are also best used in conjunction with a collaborative practice agreement. These tests break down into 2 large segments: (1) rapid tests for viruses (eg, influenza A and B, and group A streptococci), and (2) more traditional laboratory tests (eg, cholesterol, blood glucose, warfarin, hormone, and vitamin levels). A new point-of-care testing certificate is being launched by the National Association of Chain Drug Stores, and may be of interest to pharmacists who hope to provide these tests.4
The point-of-care tests for influenza A and B, and group A streptococci, have existed for many years, but have only recently been studied for feasibility and effectiveness in the community pharmacy setting.5,6 Point-of-care testing for infectious diseases provides an excellent opportunity for community pharmacies to enhance revenue by expanding patient care services while improving health at patient and population levels. It allows for the screening and diagnostic process to be completed during a single encounter, thereby improving access to care, counseling, and patient outcomes. It can also improve the prevention and treatment of disease. These tests for influenza A and B, and group A streptococci, are administered via a nasal and throat swab, respectively, and both are CLIA waived tests. Each test takes just a few minutes for screening, administration, and generating results.
As a revenue stream, both of these tests can have a flat administration fee that would more than cover the costs of the tests and employees’ time. More importantly, these tests can open up more opportunities, especially within the scope of a collaborative practice agreement. Many early adopters of these tests are in states that have more liberal collaborative practice agreement regulations, such as Michigan and Nebraska. These regulations allow a collaborating physician to sign off on a protocol through which a pharmacist can evaluate a patient for eligibility of the test, administer the test to those eligible, read results, and immediately start treatment if the test is positive.7 This takes a $25 test (doubled for testing of influenzas A and B) and adds a prescription for oseltamivir (Tamiflu), and/or over-the-counter medication recommendations to reduce bothersome symptoms. The same methodology can work through a similar collaborative agreement for Streptococcus testing and other tests that have recently come along, including those for hepatitis C, human immunodeficiency virus, and Helicobacter pylori.
Pharmacies have been participating in varying levels of point-of-care laboratory testing for years; everything from blood pressure screenings, hormone levels, cholesterol screenings, and running in-house anticoagulation testing. As collaborative practice agreements become more mainstream, providers begin to be paid based on performance metrics, and patients approach healthcare as informed consumers, these opportunities will continue to grow. Offering services such as point-of-care testing on a single-stop, single-fee basis can improve patient health (because far too many patients do not get regular screenings for which they are indicated), improve health plan quality metrics (which can then be used as leverage for reimbursement), and, of course, provide a new revenue stream.
2 Clinical trial recruitment
3 Pharmacogenomic testing
Several pharmacies have started working with a laboratory, local physicians, and payers to include genomic testing in medication therapy management programs. There are no point-of-care tests available for this information, but some may be able to collect genetic samples with a cheek swab and send it to a laboratory for analysis, making it so that the patient only needs to visit the pharmacy. As the costs of genetic evaluation continue to decrease and the number of medications known to be affected grows, this opportunity becomes more and more important. President Obama’s most recent State of the Union address and accompanying budget called for the collection and study of 1 million patients’ complete DNA.8,9 This research, along with thousands of private investigations, will undoubtedly lead to more indications for genomic testing.
Rolling into Medication Synchronization
These 3 diversified revenue options may seem overwhelming, but the time is ripe for a reimagining of the pharmacy workflow system, and the revenues that support it. When community pharmacy first entered the immunization arena, the process of providing this service also seemed overwhelming. Now, it fits relatively seamlessly into workflows across the country, regardless of prescription volume. These other clinical offerings can do the same with the right systems and goals.
One way to remove workflow challenges is by instituting a medication synchronization program and appointment-based model of practice. A system that reduces patients’ visits to a store to once a month and removes a vast majority of incoming phone calls frees up time to work in other services. It also allows pharmacists to meet with patients at a preset time during which many will find they are able to add services, from immunizations to medication therapy management, and even tests such as hemoglobin A1c, cholesterol, vitamin D, and genetic screening.
These appointments are a natural place for these (and other) programs, because patients generally have set aside, or are willing to set aside, 20 to 30 minutes every few months to sit down for additional services.
A Call to Action
We are all well aware of the challenges facing pharmacy and the rest of the healthcare industry. However, by offering these differentiated services, we have an excellent opportunity to move the practice of pharmacy forward, practice at the top of our license, provide the best care for our patients, and help revolutionize the delivery of healthcare in our country.
Start today by reviewing your state law on collaborative practice agreements, and look into getting your pharmacy certified for CLIA waived tests. Then you can decide which revenue streams you would like to pursue, and begin making the connections needed to make them a reality.
- US Food and Drug Administration. Clinical laboratory improvement amendments (CLIA). www.fda.gov/Medi calDevices/DeviceRegulationandGuidance/IVDRegulatory Assistance/ucm124105.htm. Updated April 16, 2014. Accessed April 17, 2015.
- Centers for Disease Control and Prevention. Clinical laboratory improvement amendments (CLIA). http://wwwn.cdc.gov/clia/. Updated October 14, 2014. Accessed April 17, 2015.
- Centers for Medicare & Medicaid Services. Clinical laboratory improvement amendments (CLIA). www.cms.gov/Regulations-and-Guidance/Legislation/CLIA/index.html?redirect=/clia/. Updated March 5, 2015. Accessed April 17, 2015.
- National Association of Chain Drug Stores. Upcoming trainings. http://nacds.learnercommunity.com/upcom ing-trainings. Accessed April 17, 2015.
- Gubbins PO, Klepser ME, Dering-Anderson AM, et al. Point-of-care testing for infectious diseases: opportunities, barriers, and considerations in community pharmacy. J Am Pharm Assoc (2003). 2014;54:163-171.
- Fanous AM, Kier KL, Rush MJ, Terrell S. Impact of a 12-week, pharmacist-directed walking program in an established employee preventive care clinic. Am J Health Syst Pharm. 2014;71:1219-1225.
- Akinwale TP, Adams AJ, Dering-Anderson AM, Klepser ME. Pharmacy-based point-of-care testing for infectious diseases: considerations for the pharmacy curriculum. Curr Pharm Teach Learn. 2015;7:131-136.
- Obama BH. Remarks by the President in State of the Union Address. January 20, 2015. www.whitehouse.gov/the-press-office/2015/01/20/remarks-president-state-union-address-january-20-2015. Accessed April 22, 2015.
- Office of Management and Budget. Fiscal year 2016 budget of the US Government. www.whitehouse.gov/sites/default/files/omb/budget/fy2016/assets/budget.pdf. Accessed April 22, 2015.