Empowering Your Pharmacy: Managing Programs and Profitability
A PSAO can provide immense value to a pharmacy needing back-office support. Most pharmacists utilize PSAO services to gain access to a large contract base, handle their contract negotiations, and manage and distribute their receivables. However, as pharmacies continue to be impacted by rising Direct and Indirect Remuneration (DIR) fees, steady changes in audit criteria, and overall lower profit margins, it is imperative that your PSAO can provide program solutions to ease these burdens.
It is easy to see why DIR fees are at the top of every pharmacist’s mind. In just a decade, the Center for Medicare & Medicaid Services (CMS) revealed that DIR fees have increased by over 90,000 percent! Pharmacies can become quickly overwhelmed with managing these fees, but a strong PSAO partner can provide you with solutions to ease these burdens. Many PSAOs partner with programs that can help decrease the back-end burden for pharmacists and make attacking DIR fees simpler. Quality monitoring programs like EQuIPP™ and OutcomesMTM allow your pharmacy to receive essential data that makes confronting DIR fees more straightforward. These services should be made available when your pharmacy would like to use them. However, they should never be forced onto your pharmacy or bundled into package pricing, as they are not for everyone. A good PSAO can not only educate your pharmacy on best practices for all platforms but also discern what programs are a good fit for your pharmacy.
The COVID pandemic has shifted how much of business is done today. Many tasks, including audits, have now become virtual. In 2020, many PBMs shifted to virtual audits, which according to PAAS National data, allowed for a 40% increase in reviewed prescriptions. It is becoming increasingly important for pharmacists to have an auditing process they are confident in. A good PSAO can provide you with in-house audit support that will help monitor your claims as well as guide you through the audit process. When it comes to audits on potentially hundreds of claims a day, automation is key, which is why a PSAO that can provide your store with Pre and Post Editing software is crucial to avoiding trivial audits.
As the frequency of audits and DIR fee hikes continue, pharmacies also continue facing challenges maintaining profitability. It was one of the most frequently discussed topics at the 2022 NCPA Annual Convention this year. A pharmacy’s profitability can no longer survive on billing medications alone. To thrive in today’s economy, a pharmacy must develop multiple revenue streams. Lectures from this year’s convention ranged from opportunities in pharmacogenomics, point-of-care testing, and hearing aids, to the cost-plus pharmacy model. Autofill programs and secondary packaging solutions such as Medicine-on-Time also have the ability to keep patients adherent to their medications. There are numerous ways your pharmacy can positively impact patient health while also generating profits and keeping the patient in the store. A good PSAO can discuss these opportunities with you and even provide you with resources to get your pharmacy started.
DIR fees regularly increase, audits are becoming more prevalent, and profit margins are lower than ever before. Owning a pharmacy can feel very difficult right now, so it is more important now than ever to ensure you are partnering with the right PSAO. Providing access to multiple programs, ensuring these programs are right for you, and strategizing while educating your team to make the most out of your additional services – this is what makes a good PSAO an excellent partner. Make sure when choosing a PSAO, that it puts your Pharmacy First.
About the Author
Dalton Thompson, PharmD, is the Senior Manager, Pharmacy Programs for Pharmacy First with almost 10 years of pharmacy experience. His experience began in retail pharmacy and his passion for helping patients within the healthcare system brought him to managed care. His past experience in the U.S. Air Force Reserves has instilled in him meticulous attention to detail when assisting patients and pharmacists alike.