Value-Based Care Requires Specialty Pharmacy Scale With Broad Capabilities to Deliver Enhanced Patient Services

It is not news that the specialty pharmaceutical market is growing at a rapid pace. Spending continues to shift from traditional to specialty medications and utilization of specialty drugs to treat patients with complex conditions in the areas of oncology, rheumatology, and endocrinology is rapidly increasing. According to the National Center for Biotechnology Information, specialty drugs account for 67% of the total drug spend—and that number continues to rise.

What is new is that specialty pharmacies and health care providers now have to figure out how to operate within the value-based care (VBC) environment. VBC programs, such as the oncology care model (OCM), are focused on improving access to care, driving better outcomes, and appropriate spending. VBC programs measure value by focusing on improving quality, as defined by achieving better outcomes, improving patient satisfaction, and lowering costs by decreasing the total cost of care and avoidable medical spending.

Speaking on this topic at the recent National Association of Specialty Pharmacy Annual Meeting and Educational Conference, I realized that there is a great deal of uncertainty regarding the impact of VBC. This article will focus on what you need to know about starting a specialty pharmacy or refining your existing operations to be competitive in this evolving environment.

The shift to value-based reimbursement models will have a significant impact on nearly all stakeholders. For patients, it means safe, appropriate, and effective care with enduring results at a reasonable cost. Providers must employ »  evidence-based medicine as well as proven treatments and techniques that take into account patient wishes and preferences. Manufacturers will succeed by moving beyond simply marketing an effective drug and focusing on cost-effective outcomes.

Within this environment, there is great opportunity for specialty pharmacies to help support this new payer transformation. Specialty pharmacies have the clinical knowledge and expertise in access and patient support that can help practices deliver on the promise of value. If you are looking to open your own specialty pharmacy to take advantage of this opportunity, there are a number of requirements you need to consider, including:

  • scale efficiencies
  • care coordination and access
  • expanded services and patient support
  • VBC and quality data reporting


Minimum Efficient Scale
With the tremendous growth of specialty drugs over the past several years, there are clear revenue opportunities for a competitive specialty pharmacy that can prove value to patients and providers. Because this is a high-reward, high-risk business venture, the best way to mitigate that risk is through the development of a comprehensive business plan, evaluating your ability to capture market share and generating recurring revenue.

In economics, the minimum efficient scale is the lowest amount of production a company can achieve to minimize long-term total average costs while still taking full advantage of economies of scale. In terms of starting or operating a specialty pharmacy, what level of efficiency is required to achieve the scale needed to offset the ongoing depression of reimbursement? What capital investment is needed to reach and maintain that scale and support the delivery of enhanced patient services?

Unlike a traditional retail pharmacy, the potential volume for a specialty pharmacy is less about location than it is about venue. Can you meet scale with a contract with a single large oncology group or health system? Would the business be big enough to support your minimum volume or do you need to work with multiple health systems? Do you need to work with 10, 25, or 50 health systems to aggregate enough volume?

The choice of therapeutic focus areas is also important in terms of defining your market. Can you meet volume by trying to capture a percentage of business across many therapeutic areas or is it better to focus on oncology in general or even a few specific disease states? Once you build your financial case, then you can focus on how to showcase your clinical expertise and ability to improve patient care.


Care Coordination and Access 
With the complexity of specialty pharmaceuticals, patient onboarding, prior authorizations, and other administrative tasks are important to ensure patients have timely access to needed treatments and the practice is paid properly. However, these tasks are a significant burden for oncology practices. This is a competitive advantage for specialty pharmacy partners that can provide comprehensive practice management resources that help practices run more efficiently. This is about showcasing your expertise and being able to do it with scale and efficiency.

When we look at the level of care coordination and the flow of data required to process a referral, you can begin to see that the specialty pharmacy workflow is much more than prescription fulfillment (Figure). Specialty pharmacy dispensers require heavy interaction with patients, providers, manufacturers, and payers paired with the knowledge and resources to navigate patient access.




Community practices want a specialty pharmacy partner with extensive therapeutic expertise and experience in oncology that will support their treatment plans and alleviate their administrative burden so they can focus on treating patients. They want a pharmacy provider with the skill, expertise, and resources to understand and help manage the clinical, financial, and emotional complexities associated with cancer treatment.


Enhanced Services and Access to Care
Gaining access to treatment is just the first step. Ongoing education and patient-centric support is critical to maintain adherence and improve patient outcomes. Practices must own the primary responsibility for patient care; however, specialty pharmacies can help manage clinical complexities, such as educating patients on how to properly take their medications, controlling adverse effects, helping patients deal with late-stage therapies, and other intricacies that affect this niche patient population (Table). 


Several of the enhanced care requirements are historical core services that specialty pharmacies provide today. Financial counseling, symptom management, and increased surveillance through behavioral-trained contact center agents are things that specialty pharmacies do well today. Specialty pharmacy partnerships can help oncology practices effectively and efficiently manage critical patient needs with a high-touch, high-care multidisciplinary operating model.


Value-Based Care and Quality Data Reporting
The Center for Medicare and Medicaid Innovation’s OCM is an alternative payment model designed to test whether specific changes in cancer care delivery can result in “better care, smarter spending, and healthier people.” Practices that participate in the OCM are now required to provide care with a focus on outcomes and affordability.

Although these new requirements are expected to help improve access and patient care, implementing them is a challenge for community practices not used to tracking and reporting quality data. This provides a great opportunity for specialty pharmacies to help practices meet many of these new quality and reporting requirements.

The ability to capture, track, and report accurate and timely data is very valuable to oncology practices as more payers base payments on outcomes. With the increasing need to describe the patient experience, specialty pharmacies provide critical data on important factors such as adverse events, patient-reported outcomes, compliance measures, and patient durability. These data not only translate into actionable insight to improve operational and clinical efficiencies that support high-quality care, but they also provide critical visibility for billing and reimbursement.

While the ownership and arbitration of the data and analysis of value-based contract metrics is up for debate, specialty pharmacy is well suited for that role, given its interaction with multiple payers and pharmacologic expertise that helps reduce medication abandonment and improve adherence.


Plan for Success
Specialty pharmacies have the expertise in reimbursement, access, and patient support that provides value to both patients and practices. As the industry continues to shift toward value-based care payment models, there is tremendous opportunity for specialty pharmacies to succeed and grow. Optimize your success through careful business planning and implementation of patient-centric clinical services and capabilities that help practices deliver cost-effective care and improved outcomes.



Most Popular

Related Articles

John Giannouris, vice president, Specialty Pharmacy Services, ValueCentric, discusses the data customers should be asking for from a specialty pharmacy.
Top news of the week from Specialty Pharmacy Times.
Top news of the day from across the health care landscape.
Company Profile >
Contributors >
Industry Guide >
Market News >
Peer Exchange >
Conferences >
Subscribe >
Specialty Times Resources
About Us
Advertise
Careers
Contact Us
Terms & Conditions
Privacy
MJH Associates >
Pharmacy Times
OTCGuide
American Journal of Managed Care
Cure
MD Magazine
ONCLive
Targeted Oncology
Physicians' Education Resource
Pharmacy & Healthcare Communications, LLC
2 Clarke Drive
Suite 100
Cranbury, NJ 08512
P: 609-716-7777
F: 609-716-4747

Copyright Specialty Pharmacy Times 2006-2018
Pharmacy & Healthcare Communications, LLC. All Rights Reserved.