Currently in healthcare, everything that you read and hear is focused on providing higher value, being paid for outcomes, and aligning incentives across away healthcare. The question is no longer, “are we going to move away from being paid for more activity” but “how far and how fast will we move?” As we manage this transition to multiple forms of payments and incentives it is important for us to select strategies that will provide value in multiple environments. These critical attributes could include strategies that improve patient outcomes, create operational improvements across acute continuum of care, decrease total cost of care, and increase cash flows. However, it is rare to see current strategies that actually accomplish all of these outcomes.
Expansion into ambulatory pharmacy management and specialty medication management is an example of a service strategy that meets all of the criteria above. Health systems have the opportunity to implement “point of care” pharmacy management that integrates pharmacy skills into the physician clinic setting to provide better specialty medication management for complex patients. These specialty medications cost $10,000 to $100,000+ annually and are growing at a fast rate. According to Drug Trend Report, these prescriptions represent less than 1% of prescriptions written, represent 25% of total prescription spending, and are growing at 17% to 19% annually. For example, in Minneapolis, and Detroit, where Fairview Pharmacy Services partners with the University Medical Center, Fairview and Henry Ford Health System, have demonstrated the ability to manage these medications quicker in alignment with physician care in an ambulatory setting. The results have shown improvement in patient outcomes, reduced total cost of care, and increased profits.
As the transition to more ambulatory care happens there will be less fees for service payments, and re will be a need for higher value CFOs. These CFOs will need to look at more services outside of the old normal to adjust to the changing industry.
What are your thoughts on current strategies on multiple forms of payments and incentives?
Jim Fox, Director & Sr. CFO Consultant