Hospital executives seeking to enhance revenue may turn to pharmacy to develop new revenue streams. Though it is often thought to be a high cost center, the pharmacy can also be a great source of revenue. Executive teams should work closely with pharmacy leadership to identify and develop opportunities that will bring in additional revenue.
Here are the three ways pharmacy can enhance revenue for the hospital:
- Retail Pharmacy
A retail pharmacy is a business opportunity to explore for strategic growth of outpatient services and alignment with existing service lines and outpatient clinics. Outpatient prescription services can support HCAHPS medication education survey questions, through the deployment of a “meds to beds” program. Capturing discharge prescriptions and outpatient prescriptions from your outpatient treatment areas and clinics can keep patients within your network and improve revenues. Additionally, an outpatient pharmacy can target filling employee prescriptions and reducing your health plan prescription costs.
The American Society of Health Systems Pharmacists practice survey  showed that almost half of all health systems pharmacies have implemented an outpatient pharmacy prescription program. “Implementing a program requires a business plan to project volumes and growth strategies,” says Dana Fox, Pharm.D., Director of Patient Safety and Pharmacy Compliance for CompleteRx. Some of these growth strategies may include filling prescriptions for assisted living and nursing homes within your market area. The provision of prescription delivery services and supplying durable medical equipment are services that differentiate your outpatient pharmacy and provide more value to your patients. As part of your analysis, it is important to consider the impact that being a 340B covered entity may have on the performance of your pharmacy and the ability to expand ambulatory service lines.
- Specialty Pharmacy
Specialty medications are biologic drugs that may have cold chain requirements, require scheduled monitoring of laboratory values, have substantial upfront processes to enroll and obtain prior approval, require pharmacy benefit verification and management, and risk evaluation and management strategies. While specialty drugs make up less than 3% of total prescription volumes, they are projected to represent 65% of all new medications launched as reported by IQVIA. Nine out of the top ten selling medications are in the specialty class and analysts predict that specialty medications will be almost 50% of all prescription revenue by 2022. All of the top pharmacies in the country, and many large health systems have established specialty pharmacies to expand their outpatient prescription services.
Rheumatoid arthritis, psoriasis, cancer, inflammatory bowel disease, and hepatitis C are examples of diseases treated with specialty medications. Pharmacy leadership can assist in reviewing patient populations and assessing if there are opportunities to manage these high cost medications. As with retail pharmacy services, being a 340B covered entity is something that needs to be considered and thoroughly explored. Providing these services may give your facility more options to care for your patients and manage their disease state, while increasing your revenue.
- Compounding Pharmacy
Providing compounding pharmacy services is another opportunity to expand revenue and care in the outpatient area. A compounding pharmacy is an extension of the retail pharmacy and is a service that would be provided to patients based upon written prescriptions by physicians. These prescriptions are for therapeutic treatments that are not commercially available. The provision of these services is something to consider if you have specialties such as dermatology, endocrinology, pain specialists, gastroenterologists, dentists, pediatricians, and even veterinarians. These prescriptions are for treatments such as hormone replacement, flavoring of medications to mask taste, and preparing treatments without certain ingredients because of patient allergies. Compounded medications are special medications that can increase revenues and present a positive service image within your community. Again, a thorough assessment is needed to evaluate the opportunity and a very strong marketing plan is a requirement for this service.
It is common for hospitals seeking these revenue avenues to partner or consult with a company or hire a dedicated resource with expertise and experience. “The opportunities for growth are there, but none of these are going to be turn-key,” Fox says, “but when done right, the outcomes can be a major pay off.”
 IQVIA Institute for Human Data Science. The Global Use of Medicine in 2019 and Outlook to 2023: Forecasts and Areas to Watch. Available from: https://www.iqvia.com/insights/the-iqvia-institute/reports/the-global-use-of-medicine-in-2019-and-outlook-to-2023
by Dana Fox, CompleteRx Director of Quality & Compliance