Click.Order. Save. From our warehouse to your shelf– discounts on thousands of drugs
BOOMER BUSINESS Medicare Part D in 2013
THERE’s AN APP FOR THAT A new way for patients to manage their diabetes
RxPlanGuard Are you tired of losing patients to mail order?
VOL. 1 ISS. 3 | DEC 2012 | PBAHEALTH.COM
The Magazine of PBA Health
6 | Mobile technology can help diabetic patients better manage their disease. See what your pharmacy needs to know about smartphone apps.
17 | A low-cost medication model is the 2013 Medicare Part D answer to rising healthcare costs. Find out how you can position your pharmacy for success.
departments 5 News: The latest industry updates that matter to your
22 More For Your Money: Introducting RxPlanGuard
6 Technology: There’s An App For That
26 Community: Shop Talk
8 Bricks & Mortar: 5 Niche Services For Your Pharmacy
28 Outlook: Perspective of a Soon-To-Be Pharm.D.
Connecting diabetic patients with new ways to manage their disease. Focus on these growing niche services to expand your business.
20 ACTIVE INGREDIENTS: Audit Issues
Avoid these common pharmacy audit pitfalls.
Are you tired of losing patients to mail order?
Improve how you communicate with your pharmacy’s professional partners. Q&A with PBA Health intern Kimberly Kern.
30 Notes: 10 Things You Didn’t Know About PBA Health
How much do you know about PBA Health? Find out!
features 10 Click. Order. Save.
Earn substantial discounts on both brands and generics through the no-contract, easy-to-use Negotiator ordering service.
ON THE WEB //
17 Boomer Business
How did a low-cost medication plan become the answer to Medicare Part D in 2013?
Explore exclusive online content to improve your business at www.pbahealth.com.
How To Profitably Manage Your Pharmacy’s Inventory You invest a lot of money into your pharmacy’s inventory. Discover how managing it effectively can lead to better cash flow and greater profitability. Find the article at www.pbahealth.com/pba-profitguard.aspx in the “Related News” section.
Do Your Contracts Require You To Accept PBM Discount Cards? PBM contracts often add in stipulations that require your pharmacy to accept their discount cards. See how these conditions can negatively affect your business. Find the article at www.pbahealth.com/pba-trinet-third-party-network.aspx in the “Related News” section.
Is Your Pharmacy Keeping Up With Marketing? Your pharmacy has more competition than ever today. As your competition increases, marketing your pharmacy becomes significantly more important. Find out why your business can’t afford to ignore marketing. Find the article at www.pbahealth.com/pba-marketing.aspx in the “Related News” section.
ELEMENTS is published quarterly by PBA Health. Copyright© 2012 PBA Health. All rights reserved. Neither this publication nor any part of it may be reproduced without written permission by PBA Health.
Pharmacists dedicate more time to providing alternative care for patients than they have in the past, according to a new study. Pharmacists Play An Increasingly Active Role In Patient Care, Study Finds Pharmacists are spending more of their time providing care and support for patients than they did two years ago, according to a 2012 study by Manhattan Research, a healthcare market research and advisory firm. In the study, about two-fifths of the pharmacists surveyed said they spend more time providing alternative care, such as recommending a website or app to their patients, than in the past. The study surveyed 752 U.S. pharmacists online in September and October 2012. The study found that the top conditions where retail pharmacists provide the most care and support for patients include diabetes, cardiovascular disorders, pain, respiratory diseases and psychosis/depression. PBA Health Launches Supplementary Rebate Program We’ve created a new program to drive additional savings to our customers’ bottom lines. Called RxCircuit, this premium market share rebate program enables pharmacies that order through the PBA Health warehouse to earn additional manufacturer rebates
on purchases of certain generic items while quantities last. The program is simple. PBA Health negotiates special bulk quantities and rebates on specific items with participating manufacturers. These items are sold on a ‘firstcome, first-served’ basis, and the additional rebates only apply while the specific RxCircuit quantities last. The additional rebates range from 10 to 20 percent. To use RxCircuit, customers simply order through PBA Health as they normally do. The special rebates through RxCircuit are available for easy viewing on a separate webpage after the login at www.pbahealth.com. Mark Your Calendar For The 2013 PBA Health Conference The upcoming 2013 PBA Health Conference will take place July 12-14, 2013 at the Sheraton Overland Park Hotel at the Convention Center in Overland Park, Kansas. Don’t miss this event created exclusively for community pharmacies. The conference will be packed with informative continuing education courses, knowledgeable speakers, an expansive vendor tradeshow, networking opportunities and more. Mark your calendar today! Report Highlights Importance Of Medication Adherence To Reduce Hospital Readmissions New evidence emphasizes the valuable role of medication management in improving patient outcomes and reducing hospital readmission rates. An October 2012 report released by the national health policy institute (NEHI) found that medicationrelated adverse events cause a significant amount of hospital readmissions of Medicare patients. One-third of the adverse drug events resulting in a hospital admission
were related to non-adherence, according to the report, “Thinking Outside the Pillbox: Improving Medication Adherence and Reducing Readmissions”. The report also references the lack of coordination among healthcare providers. It points to healthcare models that include multi-disciplinary healthcare teams to improve patient health and also to reduce the costs of repeat hospitalizations to the healthcare system. PBA Health Announces RxPlanGuard PBA Health is excited to announce the launch of RxPlanGuard, a new prescription benefit plan consultative service that gives employers in your community an opportunity to objectively review their pharmacy benefit spending. For more information on how you can get involved, turn to page 22. Proposed Rule for Essential Health Benefits The U.S. Department of Health and Human Services has proposed a rule detailing the standards of Essential Health Benefits under the Affordable Care Act. Beginning in 2014, “all non-grandfathered health insurance coverage in individual and small group markets, Medicaid benchmark and benchmarkequivalent plans, and Basic Health Programs (if applicable) will be required to cover essential health benefits (EHB).” This list of essential health benefits includes prescription drugs, and requires each plan to cover the same number of drugs in the benchmark plan. Get daily news updates on issues that matter to your community pharmacy by following us on Facebook at www.facebook.com/pbahealth and on Twitter at www.twitter.com/pba_health.
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There’s An App For That Connecting diabetic patients with new ways to manage their disease By Kirsten Hudson
With one device, your diabetic patients can start improving their health. Hint: It’s more of an ordinary gadget than a blood glucose monitor. Your patients likely have it in their pocket or purse right now—it’s their cell phone. Turns out smartphones are good for more than checking email on the go and sending pictures. Smartphone applications, which are also known as apps, as well as the email, online and texting capabilities of mobile phones, can help diabetic patients better manage their disease, according to a 2012 report published by the eHealth Initiative, a non-profit organization that researches and identifies ways health IT can improve healthcare. Although the report specifically looked at patients with diabetes in socially disadvantaged populations, all diabetic patients can benefit from an additional option to help them keep up with the day-to-day requirements of their health. And, they can do it all with their cell phone—a device they likely already use considering that nearly half of American adults own smartphones, according to a February 2012 report by the Pew Research Center. James Bennett, R.Ph and a certified diabetes educator, said he has noticed that text messaging has become especially useful in recent years for pharmacists and their diabetic patients, as well as for their patients in general. Text messaging capabilities that remind patients to pick up their medications and to refill their prescriptions are seeing increased use, likely because more people simply have smartphones, said Bennett, who manages the diabetes education and disease management center in the James Bennett Apothecary in Corinth, Mississippi. “Even in my small town, which is in a fairly rural area, you see a surprisingly large amount of people who use smartphones.” Going digital The unique features of mobile phones can help diabetes patients better manage their condition. Email,
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text messaging and the easy online access provided by smartphones create more opportunities for patients to communicate with their healthcare providers and to learn about their disease. As a chronic condition, diabetes requires consistent, active effort by patients to self manage their disease. Diabetic patients have to regularly check their blood glucose levels, keep track of their diet and exercise regimens and maintain any additional treatments. Fortunately, new mobile technology can help. “One of the things that mobile technology can do for diabetic patients is to keep them focused on their condition,” Bennett said. “Electronically you can stay in touch with patients easier and, with diabetes especially, staying in touch is so important.” “At our diabetes education center, if patients go more than two weeks without contact with you, then there’s a good chance they’ll get lost,” he said. “After an initial consult, you get them really enthusiastic and if they come back, you can keep that momentum going. But, if they don’t come back, you lose it. That’s where technology can help. Even if you’re not face-to-face, using mobile technology is still a viable method of follow up.” Apps for diabetes Smartphone apps are quickly becoming more widely used for diabetes management. From apps that monitor insulin levels and blood pressure to diabetes-specific weight management tools and apps to keep track of medications, if diabetic patients need help with a specific component of their treatment, they can likely find an app for it. Mobile apps for health are gaining in popularity. Already 60 diabetes-specific apps exist for the iPhone, and more than 260 apps are available over a number of other mobile platforms, according to the eHealth Initiative report. Some apps even work as a more comprehensive treatment system. Instead of monitoring just one component,
like weight management, these all-inclusive apps contain a variety of different features that give diabetic patients a better representation of their overall health. For example, some apps link to online portals that store the data that the patient inputs through the app. This online connection enables these apps to hold larger amounts of information than single-component apps can handle. They can store blood glucose levels, carbohydrate intake, medication adherence, weight data and more—instead of just one of these types of data. Patients can then share this detailed information with their physician, pharmacist and caregivers, who can then more effectively treat them. “Pharmacists need to be aware that smartphones and other devices that allow access to patient monitoring data are incredibly valuable,” Bennett said. “These devices enable instant remote communication with patients to coach them, remind them to take medicine, confirm an appointment and more.” How pharmacists can help Your diabetic patients come to your pharmacy regularly to stock up on insulin or to refill their diabetes medication. As one of their most accessible healthcare providers, your patients depend on you to help them manage their disease. Encourage your patients to look at mobile apps and new technologies to help them successfully take charge of their health. To do so, you’ll need to educate yourself on the apps available. If you own a smartphone, download and test some diabetes apps to get a feel for what’s available. Pharmacists also need to look into the ways that their patients and their community as a whole are using mobile technology. “We have to be able to know about, utilize and recommend the technologies that the health providers in our area are promoting,” Bennett said. In the future, pharmacists will also need to stay informed on the types of technology the insurance companies recommend or require for their members. Encouraging your diabetes patients to use mobile technologies can not only improve their health, it can also strengthen your business. When patients learn how they can use their smartphones to improve their health from you, they’ll view your pharmacy and your pharmacists as diabetes experts. They’ll likely want to return to your pharmacy for more information and possibly even recommend your store to others. Who knew being tech savvy could be so good for business?
Download This! 5 Apps For Diabetic Patients Calorie Counter by MyNetDiary This app makes keeping track of a diet easier. Users can record meals, water intake, exercise, and weight loss with this comprehensive app, which works with MyNetDiary online. Available on iPhone, iPod Touch, iPad, BlackBerry and Android. dLife Created by the dLife website, this app enables users to log glucose levels, find recipes and nutritional information, and more. Users can graph daily, weekly or monthly glucose levels and track trends, all of which they can e-mail to themselves or to their providers. Available on iPhone, iPod Touch and iPad. Fooducate Armed with this app, users can scan barcodes and search for healthy foods at the grocery store. Fooducate grades groceries and explains what’s really inside each product. It also gives recommendations on healthier alternatives. Available on iPhone, iPod Touch, iPad and Android. Glucose Buddy It’s easy for users to record blood glucose levels, insulin injections and diet and exercise information with Glucose Buddy. This app connects users to Glucose Buddy forums and allows them to sync the app to an online account, where they can manage their blood glucose data and review trends. Available on iPhone, iPod Touch and iPad. Workout Trainer This app helps users stay fit by featuring workouts led by personal trainers. The exercises, which don’t require any equipment, include step-by-step photos, videos, and audio. Users can track their progress through their phone or online. Available on iPhone, iPod Touch, iPad, BlackBerry and Android. List courtesy of the American Diabetes Association
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BRICKS & MORTAR
Your Physical Pharmacy
Niche Services to Offer at Your Pharmacy You know your pharmacy isn’t just any pharmacy. You have a dedicated staff and the kind of friendly, customer service that only comes at a community pharmacy. Still, as reimbursements for dispensing decrease and competition for the same patients intensifies, you need to consider what else you can offer your patients. Look beyond the traditional areas of pharmacy. Separate your pharmacy from all of the other options out there by specializing in specific services. When you focus on a certain niche, you create more value for your patients, which can translate into more pharmacy traffic— and more profits. These five growing niche services are ones to consider starting at your pharmacy.
Pet prescriptions Want to grab a booming, or maybe barking in this case, new market of patients? Look to the beloved family pet. Filling prescriptions for common animal conditions can mean extra revenue for your business. What’s even better than gaining a new patient base? Keeping all the profits. Even though Rover and Princess may be part of the family, they aren’t insured, which means that PBMs can’t take a cut of your profit for pet prescriptions. If your pharmacy already offers compounding, you should also consider adding pet compounding to your list of services. Let your patients know that you can dispense medications for cats and dogs prescribed by their veterinarian. Also, talk with your local vets to let them know that your pharmacy is happy to dispense pet meds, and will gladly work with them. Build a good relationship with local vets and they’ll likely start referring furry patients to your pharmacy.
Immunizations Every year, more of your patients are turning to you for their vaccinations. Independent pharmacies are convenient locations for patients to get their flu, pneumonia or shingles immunizations. Not only that, when you offer immunizations you create another opportunity to add dollars to your bottom line. In fact, Medicare payments now include the cost of ingredients and the administration fee, and private plans have increasingly included coverage for vaccinations as a benefit to members. Consider offering group discounts to local businesses or non-profit organizations to bring in more business.
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BRICKS & MORTAR
Durable medical equipment If you have the front end space available, supplying home medical supplies and products can be a profitable, and rewarding, addition to your pharmacy services. Positioning your pharmacy as friendly and willing to help patients with the difficult task of recovering from a surgery or dealing with a chronic condition can build your rapport with patients. Your patients will appreciate being able to purchase the home health care products and supplies they need to get healthy and stay healthy at their local pharmacy. And, you can offer them your expert advice and product recommendations to improve their lifestyle. It’s up to you what types of products you want to offer. You can supply as few or as many products as you think will fit with your patients’ needs. From glucose meters and compression hose to respiratory products to splints, supports, and even mobility devices, you can specialize in a certain area, like diabetes, or choose a range of different products and equipment to offer.
DIABETES Twenty five million children and adults in the United States have diabetes, according to the American Diabetes Association. That’s 8.3 percent of the population, and a lot of potential patients for your pharmacy. Independent pharmacists just like you are well positioned to address patients’ diabetes education and to help monitor and treat their condition. Stocking diabetic supplies in your pharmacy, such as test strips, a variety of meters to suit different patients, and control solutions, is a good start. Adding sugar-free candy, compression socks, and even diabetic cookbooks to your inventory can also increase revenue. Another option is to offer diabetic shoes and become certified to fit them. Position your pharmacy as the center for diabetes expertise in your area by teaming up with a nutritionist or the nurses in your community to host classes for patients who have been recently diagnosed with diabetes. Or, you could hold regular educational seminars for the parents of diabetic children.
Bio-identical hormone therapy This compounding service is a rapidly growing niche service that many pharmacies are adding to their repertoire with great success. The term bio-identical assures patients that the molecular structure of the bio-identical hormone is identical to a hormone that human beings make in their bodies. This highly personalized service requires an investment put toward proper facilities, training and an inventory of products, but the result can be a lucrative service that results in happier patients, too. The added benefit of offering BHRT is the opportunity to work more closely with the physicians in your area.
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Click. Order. Save. This online ordering service takes a whole new approach to purchasing
By Kirsten Hudson
Not every ordering service lets you set your own discounts. Most don’t take off a whole order discount on both brands and generics, either. And, what other method of buying gives you an upfront rebate? At PBA Health, our prices are already great for business, and with our Negotiator ordering service you can save even more money. When you shop with Negotiator, you set your own discount as you add a mix of items to your cart. After you meet the easy minimum qualifications—a $750 order of which 20 percent or more is generic—your discount will start to increase. You control how high your discount will be. Depending on the mix of brands and generics you add to your cart, you can earn whole order discounts as high as 8, 9, or even 10 percent. Pharmacists today value Negotiator for its unique approach to ordering. Besides great discounts, you don’t have any obligations with Negotiator. There’s no contract to sign, so you don’t have to worry about exorbitant
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contract stipulations or requirements. You get a discount without a commitment. As buying becomes more crucial to your business, exploring a new way of ordering can mean the difference between earning revenue and losing money. Take a look at how pharmacies across the country have seen Negotiator improve their purchasing—and their profitability. Discounts on discounts At Medicap Pharmacy in Winfield, Kansas, which is part of the Medicine Shoppe franchise, pharmacist and owner, Van Coble, D.Ph., uses Negotiator for price comparison. He shops with Negotiator as a secondary wholesaler, and orders with the service about three or four times a week. Besides the better prices, he has seen whole order discounts as high as 9.75 percent. “I’m ordering products that are already better priced than what I’m getting out of my wholesaler’s warehouse, and then I’m getting discounts on top of that? I’m
When pharmacies use PBA Health’s Negotiator ordering service, they can earn substantial discounts on both brands and generics. Depending on the mix of items in the order, users of Negotiator can achieve whole order discounts as high as 8, 9, or even 10 percent.
elated,” said Coble, who has used Negotiator since August 2012. “I know pharmacists who do nothing but order strictly from their wholesaler, and I think they’re shooting themselves in the foot,” he said. “You can’t throw all of your eggs in one basket because you’re going to end up paying more money.” Carlos Solis, B.S., owner of Ridgepoint Medical Pharmacy in McAllen, Texas, takes the 80/20 approach to saving money when ordering with Negotiator. He uses the business rule that 80 percent of your sales come from 20 percent of your product, and he orders the majority of his 20 percent through Negotiator. “Once you’ve identified the
generics that are going to be your big moneymakers, then it’s a really simple deal to go on to Negotiator and order those on a regular basis. And, you’re saving yourself a lot of money,” he said. Solis orders product through Negotiator about twice a week. At the lowest, he has earned discounts ranging from 7 to 7.5 percent, and at the highest, 9.62 percent. “And that’s in addition to, in some cases, already saving 40 percent, which is an astronomical amount,” said Solis, who has used Negotiator since August 2012. “I haven’t moved over all of my generics to Negotiator yet, but the ones I have switched have been
enough to improve my bottom line,” he said. “It has been a huge help. I’ve seen up to 3 percent bottom line improvement at the end of some months.” An immediate rebate Negotiator doesn’t just offer great discounts. It takes off your discount as you place the order. Unlike rebate systems that reimburse your pharmacy after a lengthy waiting period, with Negotiator you receive your discount immediately—and you can watch as it happens. “It’s like an instant rebate, and I think it’s valuable to have that,” Coble said. “I can see my discount coming off on Negotiator right there.
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With Negotiator, you get great deals on more than 4,000 drugs with no commitment beyond the current order. There’s no contract to sign, and no obligations. The service also features specials and popular items with reduced prices that allow you to optimize your order for even more savings.
And, that’s the front end. I don’t have to wait.” Solis also likes seeing his discounts calculated at the point of ordering. “We have to save money at every turn today,” he said. “With Negotiator, you get your money up front, and you see it immediately in terms of when you build your order.” Negotiator provides real time calculations as you complete an order, so you always know the exact discount you’ll receive at any point. You can take off or add items to your cart, or throw more generics or more brands into your order, and you’ll immediately see a recalculation of your discount through each of those steps. Negotiator will also display a real time recalculation of each individual item’s price. With Negotiator, the pricing stays transparent so you’ll always know exactly how much you’re saving. Options as needed For Anna Long, R.Ph, pharmacist at Milner Rushing Discount Drugs in Florence, Alabama, Negotiator serves as a source of alternatives when certain products or manufacturers aren’t available from the pharmacy’s primary wholesaler. “Our primary wholesaler was offering us one manufacturer for the size of generic eye drops we needed, for example,” she said. “We didn’t have a choice of item, and
we kept running into an issue of not getting reimbursement from several different insurance companies. We just noticed that we were always losing a dollar or two.” “When I got on Negotiator and thought to look at that particular eye drop, it was 90 percent cheaper than what I had been paying for it. I had been paying $17 a bottle and it was only $1.75 with Negotiator,” she said. “It’s nice to have another option available. Sometimes we didn’t have a choice, and now we do.” Although Long typically only orders generics with Negotiator, she has ordered brands, such as Nexium® 40mg granules, when her primary wholesaler was out. “It was nice to have a backup when I couldn’t get them from my wholesaler,” said Long, who has used Negotiator since July 2012. Besides serving as an additional option for ordering brands, Negotiator can also give your pharmacy a good price on those brand name drugs. And, that discount you receive? It extends to the brands in your order, not just the generics. It’s a whole order discount. Although Doug Phillips, R.Ph, owner of Altamont Pharmacy in Altamont, Illinois, mainly orders generics with Negotiator, he likes that Negotiator allows him to get a blended cost of goods. “It’s nice to throw a trade name in there every once in a while and get a good price on it,” said Phillips, who orders with Negotiator one to two
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times per week. Phillips has used Negotiator since April 2012. Better inventory management With Negotiator, you can find good deals on exactly what you need, which makes managing your inventory easier. Other ordering methods, such as sales calls, may offer special one-time deals, but they’re not always a reliable way to maintain your inventory. “One thing that I like about Negotiator is that the pricing is very consistent,” said Long of Milner Rushing Discount Drugs. “I can actually see Negotiator’s pricing and make comparisons if I need to. With sales calls, they may have something I need, but then again, they may not. When something comes up, I can just get on Negotiator and see if it’s there. It’s all at my convenience, my time. I can check whatever I need to without someone stopping me in the middle of my day.” Solis of Ridgepoint Medical Pharmacy also likes the convenience factor of Negotiator. “You do it at your leisure,” he said. “You don’t have to wait for a phone call. You just get online.”
Every Negotiator order is processed through the PBA Health Warehouse. With a 99.99 percent order accuracy fill rate, you can count on the quality assurance of our warehouse with every order you place with Negotiator.
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An intuitive design Earning high discounts and receiving hard-to-beat prices wouldn’t matter if ordering the product was cumbersome or demanded hours of your time, but Negotiator makes it easy. Negotiator features a modern ordering interface that enables you to see the exact discount that you’ll receive in real time. It also makes recommendations on how you can earn a higher discount by adding more brands or generics to your order. “It’s very self explanatory,” said Long. “I love the driver screen at the top that tells you how to maximize your savings. It’s pretty easy once you look up there and see if you
spend this much more money, then you can get an extra half percent. I love that.” Morten Jorgensen, owner of Rx ‘N Go in Clarendon Hills, Illinois, also finds Negotiator’s interface easy to use. “It’s very intuitive. Once you look up a couple of drugs, it flows easily from there,” said Jorgensen, who has been able to receive discounts approaching 10 percent with Negotiator. Rx ‘N Go is a national mail order pharmacy that offers a formulary of solely generic maintenance medications to employers. The low-cost formulary allows employers to provide medications to their employees with no copay. The business has used Negotiator since August 2012. Ordering outlook Finding the best cost of goods for your pharmacy matters today more than ever. As third party reimbursements continue to decrease, your pharmacy has to make the most on the buy-side. Independent pharmacies can agree that saving money starts with ordering better. And, Negotiator can help you do that. “As a small operating pharmacy, it’s even more critical that we buy well,” Solis said. “Our cost of dispensing is higher than a higher volume store, so every penny that we can save helps bring that down.” Long said she would recommend Negotiator to other pharmacies, and definitely to independents for optimal ordering. “It’s great to have another way to get your pricing in line with reimbursements, which are typically horrible anyway,” she said. “It’s nice to be able to actually make a profit on something every once in a while.” To learn more about Negotiator, call 800-333-8097 or email firstname.lastname@example.org today!
How did a low-cost medication plan become the answer for Medicare Part D in 2013? By Jim Young, PBA Health Director of Third Party Services, J.D.
Estimates clearly show that approximately 10,000 Americans become eligible for Medicare benefits every day. This growth should continue at a steady rate for close to two decades. Simultaneously, the race continues for market share in this fast-growing patient segment of the prescription drug industry. With such staggering numbers staring us in the face, independent pharmacists need to take decisive action and stake their claim in this market or risk losing it forever. The question remains for the Centers for Medicare and Medicaid Services (CMS): How in the world are we
going to pay for this? While no one appears to have a complete answer, CMS has manifested its willingness to, in part, address the question by focusing on low-cost medication therapies. In this case, a low-cost medication therapy does not just mean the utilization of low-cost generic drugs. CMS will focus on low-cost medication therapies directed toward those providers that are willing to accept lower costs for dispensing prescription drugs. If this approach continues, it means your pharmacy will have to accept less money from CMS for dispensing medication therapies, as well as decreased co-payments
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The numbers don’t lie. Low-cost is the principle driver for Medicare Part D beneficiaries. Even if they have been going to the same pharmacy for years, the majority of the decisions made by Medicare Part D beneficiaries are ultimately based upon the lowest cost.
Working within five-star rated Medicare Part D plans and focusing on excellent customer service is the best way to prove the value of independent pharmacy in a rapidly changing healthcare environment.
from Medicare patients. In other words, if you want to have access to this segment of the prescription drug industry at this point in time, it comes at a price. Effects and Influences The Medicare Part D program has undergone a considerable amount and variety of changes since it went into effect on January 1, 2006. However, in recent years, the plan has been modified in ways that more directly affect independent pharmacies around the nation. Most notably in 2010, the Medicare Part D Prescription Drug Manual was changed to permit patients into preferred networks with varied degrees of cost sharing. These preferred pharmacies offer Medicare Part D covered drugs at lower out-of-pocket costs than if Medicare patients took their prescriptions to a non-preferred, but in-network pharmacy. Further adding to the confusion is the fact that an individual pharmacy’s status of ‘preferred’ or ‘non-preferred’ may differ within its own sponsorship network. Even so, Medicare Part D patients have championed the preferred networks. Medicare Part D actuaries and industry insiders believe that 70% of the Medicare Part D plans in 2013 will have preferred networks, and they predict an estimated 20% of incoming beneficiaries will choose a preferred network plan when they enroll.
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Where We Are Now There are many different views as to whether CMS’ lowcost medication approach will ultimately succeed in saving the Medicare system. Independent pharmacy has consistently supported the approach that spending an appropriate amount of funds for high quality preventive care through appropriately-monitored medication therapy will improve the health status of Medicare patients and save money overall. Not only that, preventative-care driven medication therapy has been proven to provide patients with a better quality of life. Various studies have been performed that substantiate this approach. None more often cited than the Ashville Project in North Carolina. Independent pharmacists are uniquely positioned and qualified in the healthcare system to provide extremely effective and high quality professional preventive care services. In short, the pharmacist is in the best place to save the system money through preventive care. If the independent pharmacist’s position is correct, and yet CMS thinks otherwise and shows no intention of changing its low-cost medication game plan, how are independent pharmacists going to remain a part of the Medicare Part D process? If we stay on the sideline and complain that the current system doesn’t work, we can only expect things to remain the same. Changes can only be made by participating within the system and proving to the powers-thatbe that the preventative-care model is better. That means participating in Medicare Part D preferred networks. As distasteful as that might sound, we cannot ignore the numbers. Independent pharmacists have to go where the patients are waiting and prove to them that a preventative-care delivery method is better for them. And, that it will lead to a longer and higher quality life. Action Is What Matters Independent pharmacists must establish their place within higher-rated Medicare Part D plans in order to gain a larger share of Medicare Part D patients. They must also work to maintain a consistent five-star rating. One of the major changes in 2013 is that Medicare Part D beneficiaries will be able to change their five-star plan laterally (they can switch to a different five star plan, but cannot choose two or three star plans) if they wish,
which would affect performance rates. Patients rate Medicare Part D drug plans every year based on their performance using these star ratings: • Drug plan customer service • Member complaints, problems getting services, and improvements in the drug plan’s performance • Member experience with the drug plan • Patient safety and accuracy of drug pricing Since it is illegal for pharmacists to steer Medicare patients to any one plan, pharmacists must perpetuate excellent, personalized customer service practices, and work within plans that maintain the high CMS Medicare
Part D star rating. By doing this, independent pharmacy can prove its invaluable position in a healthcare environment that’s ever more focused on cost savings. Pharmacists must not let CMS confuse low co-pays and ‘cheap drugs’ with the kinds of essential pharmacy services that will provide CMS with the cost savings it seeks. Community pharmacists and their proponents need to incorporate current, detailed empirical data, similar to that brought forth by the Ashville Project, into the Medicare Part D star rating system. By providing evidence, there will be ample proof for CMS that independent pharmacy’s involvement in the cost savings process is not just necessary, but also critical.
Medicare Part D 2013: Standard Benefit Model Highlights This table compares the standard benefit design parameters for a Medicare Part D plan for 2013 to the amounts for 2012. The benefit plan changes take effect January 1, 2013. This standard benefit plan is the minimum allowable plan to be offered by any insurance company.
Initial Coverage Limit
Total Covered Drug Spend at OOP Threshold
$6,657.50 Plus a 50% brand discount
$6,733.75 Plus a 50% brand discount
LIS (Low-Income Subsidy) Copayment
Up to or at 100% FPL
Take Note! Important Changes For Medicare Part D 2013 • The Annual Election Period (AEP) began on October 15, 2012 and ended on December 7, 2012. New Medicare Part D plans will take effect on January 1, 2013. • In 2013, Medicare beneficiaries who reach the Coverage Gap (Donut Hole) will receive a 21% discount on generic drugs purchased and continue to receive a 52.5% discount on brand name drugs. • CMS will alert plan members if their Medicare Part D drug plan or Medicare Advantage health plan has failed for three straight years to achieve at least a 3-star quality rating. CMS will then offer a Special Enrollment Period (SEP), if desired, that will allow the member to move to a higher quality plan.
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Stay ahead of a potential audit by avoiding these common pitfalls
Hoping that your community pharmacy won’t be audited is not a good business practice. You need to stay prepared for a potential audit. Regular and correct maintenance of prescription records can mean the difference between extra expenses for your pharmacy and a problem-free audit. While the auditing entity will look at a range of documents, issues and records, you can avoid major pitfalls in the future by watching out for these common audit discrepancies. Not maintaining prescription hard copies Maintaining accurate prescription records is critical to your business— especially if your pharmacy is the target of an audit. Pharmacies must maintain the hard copies of prescription records that patients bring in for up to five years after the prescription is dispensed depending on state and federal laws, or if the pharmacy is involved in an ongoing audit or investigation. A good routine business practice is to file a prescription’s hard copy immediately once the prescription is dispensed, so the hard copy doesn’t get lost or forgotten.
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Some state laws also require that call in or faxed prescriptions be reduced to hard copy form with specific details, such as that the hard copy must be signed and dated in ink. Know your state’s laws and train your staff in the proper methods to maintain hard copies. not documenting refills Your pharmacy must be able to prove that all prescription refills dispensed are clearly indicated by the prescriber. Without supporting documentation, your pharmacy could be subject to a discrepant claim for filling unauthorized refills. Know your state and federal laws when it comes to refill orders called in by phone or faxed to your pharmacy. Dispensing incorrect days supply Your pharmacy must submit the quantity and days supply of a prescription based on the amount issued by the prescriber. If you issue a prescription greater than the documented days supply, you could face a chargeback. Using incorrect DAW codes Your pharmacy must maintain the
correct dispense as written codes (DAW) according to the set NCPDP standards or the prescription claim could be labeled as a discrepant claim and go unpaid. Make it standard procedure at your pharmacy to double check that the correct DAW code is used based on the information on the prescription and the prescriber’s signature. Filling prescriptions that lack or contain inaccurate directions Make sure to always include calculable, specific directions on every prescription dispensed based on the quantity issued by the prescriber. A “use as directed” prescription may be considered valid if the prescriber indicated a certain quantity and days supply within clinical reason. Keep in mind that Medicare Part D rules and regulations are different for maintaining records and filling prescriptions. Check the Centers for Medicare and Medicaid Services for additional audit information. Also, remember to always refer to the specific PBM’s provider manual for more information on any of these discrepancies.
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Introducing RxPlanGuard Are you tired of losing patients to mail order? By Kelsea Nore
PBA Health is excited to announce that we have partnered with Windsor Benefit Solutions to create RxPlanGuard, a valuable tool for independent pharmacists. Pharmacists who reach out and assist employers in their communities can potentially increase their market share in these areas and help prevent changes such as mandatory mail-order prescriptions, which can be detrimental to a patient’s health. RxPlanGuard creates opportunities for PBA Health member pharmacies to reach out to employers in their respective areas and deliver the expertise necessary to help them make better decisions regarding the design of their prescription benefit plan and choice of pharmacies. “The primary goal of RxPlanGuard is to provide a consultative service that brings employers and pharmacies together,” said Clark Balcom, vice president and COO of PBA Health. “Through proper education, cooperation, and collaboration, we hope to help employers negotiate, design, and manage PBM benefit plans that provide higher quality outcomes at the lowest overall cost.” Working For the Employer—Not the PBMs PBMs initially grew by selling the need to manage the increasing costs associated with pharmacy benefits to employers.They have a facilitative, transactional role in the delivery of prescription healthcare. Over time, however,
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the increasing costs associated with the PBM that has added to the annual price of employer-funded prescription benefit programs. Ensuring PBMs perform in a cost-effective manner depends on the experience, knowledge, and capabilities of the employers that select and hire them. Today, a new model is needed where the interests of the employer and the pharmacy are more collaborative and the role of the PBM, as well as its associated costs, is more visible and manageable. Success for employers depends on good negotiations, benefit plan designs, and the ability to measure and monitor the performance of a PBM. Successful plan designs for employees depend upon recognizing and appropriately positioning the valuable role independent pharmacies play in making sure affordability, efficacy, and accessibility are appropriately and fairly balanced in the plan’s design. We created RxPlanGuard for this reason. Knowing what to negotiate into a plan design and what to monitor on an ongoing basis depends on experience. PBA Health and David Schermer of Windsor Benefit Solutions have worked together for nearly 15 years. Schermer consulted with and managed plans for businesses that ranged from 5 to 50,000 people while working with companies
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like Cardinal Health/Medicine Shoppe, Express Scripts, and Pro Care prior to creating Windsor Benefit Solutions. Bringing the Pharmacy and the Employer Together RxPlanGuard seeks to bring important education and improvement to an already established process – that of an employer negotiating and selecting a PBM, designing a benefit plan, electing a payment and reimbursement model, and choosing a pharmacy provider network. Recognizing how this business model works and establishing relationships at the proper time is important. Too often, pharmacies are affected by decisions employers make in selecting their prescription benefit plans and have no opportunity to help the employer understand and improve the quality of those decisions. “PBMs have profited from taking business away from the local pharmacy, often at the expense of increased cost to the employer,” Schermer noted.
“The difference between an employer selecting a PBM on its own or with the help of RxPlanGuard is the degree to which the PBM itself is ‘managed’ under the plan.”
nies in their respective trade areas and suggested scripts and questions for making introductory contact simple and easy. RxPlanGuard helps our member pharmacies identify and qualify employer opportunities. Once qualified, RxPlanGuard will bring the necessary consultative expertise to improve the quality of prescription benefit plans while better managing plan performance and the roles of the employer, pharmacy, and the PBM. RxPlanGuard services encourage the adoption of direct-to-employer health savings accounts, and other alternative benefit plans, such as better cost and quality management, more educated plan beneficiaries, and more freedom and flexibility in the choosing of a pharmacy based on individual quality, service, and cost preferences. The program discourages mail order options, which often lead to unhappy patients, increased costs for employers and an unlevel playing field for community pharmacies. This service also encourages employers to offer community wellness days to provide opportunities for face-to-face interaction between employers’ beneficiaries and local pharmacies to build trusting relationships that lead to better outcomes through patient-centric education, programs and services. Call 816-245-5700 or email email@example.com today to find out more about this innovative program.
Pharmacies can improve the volume of patient and prescription business that develop from these decisions. Unfortunately, pharmacies too often do not realize they can also advance the growth and retention of their third party business. “Today’s business environment is tougher than ever for our member pharmacies.” Balcom said. “And, much of this difficulty relates to PBM practices that are not only damaging to the performance of our pharmacies, but also to several aspects of quality prescription healthcare for the employers and patients in their areas.” RxPlanGuard directly addresses this need by providing pharmacies with step-by-step guidance and education on “what to do” and “how to do it.” In addition to this assisted roadmap, RxPlanGuard also provides pharmacies with “action packets” that include listings of compa-
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Shop Talk Improve how you communicate with your pharmacy’s professional partners By Nick Smock, Pharm.D., MBA, PBA Health President and CEO
As pharmacists you communicate frequently. Every day you counsel patients about their medications and conditions. You talk with doctors about refills and treatment options. You manage your staff. With all this communication, it’s easy to forget the importance of staying in touch with your business partners and providers. Regular communication with your business partners is the only way to ensure your concerns are heard and properly addressed. You might be surprised by how accommodating certain companies will be when presented with the chance to expand their businesses—and yours— through more collaborative transactions. And, when problems must be solved, the way you communicate can spell the difference between a satisfactory resolution and a severed relationship. If you overlook critical elements—like what you actually mean or who you are speaking with—your communication efforts can fall flat. When it comes to business relationships, you can benefit by becoming a top-notch communicator. Who to communicate with and why Your pharmacy’s partners and providers include anyone you do business with in the process of delivering value to your customers. If your interactions with a company affect what you offer, you’d be wise to think of that company as your business partner and manage communica-
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tions accordingly. Here are some tips for communicating with key business partners and providers for pharmacies. Bankers Don’t wait until you need something financially to start communicating and building rapport with your banker. Your relationship with your banker should be based on trust and honesty from the beginning. Demonstrate your integrity by communicating openly with your banker about your business and finances. Send notice when something important occurs regarding your pharmacy— the good and the bad, like new LTC accounts or new competitors. Whenever possible, your banker will likely reciprocate for your open communication in the form of credit, waived fees and network referrals. Insurance Providers If you’re the victim of a crime, accident or natural disaster at your pharmacy, you’ll need adequate insurance coverage already in place to recover your losses. Recent events, like Hurricane Sandy or the wildfires in Colorado, have illustrated that businesses need to make sure they’re covered—before it’s too late to do anything about it. Have your agent explain your policies in full detail. Spend time working together to come up with proper coverage for all applicable aspects of your business.
COMMUNITY PHARMACY Ask how you can lower premiums without reducing coverage, like installing sprinklers, enhancing security, conducting safety training and offering employee wellness programs. If you take any such actions, notify your agent in writing. Communicate with other insurers, too—don’t assume you’re getting the best rates from year to year by sticking with your current provider. Accountant and Financial Experts If you’re using only the basic services from your accountant, you’re missing out on some insight that could lead to cost-saving opportunities. When you communicate your business goals to your CPA, you can put years of analytical experience to work for your pharmacy. For example, consider getting a financial statement review. Your CPA will analyze your financial and operational data and will compare it to industry standards and historical data. The results will reveal current implications on your financial future. You can also have your statements formatted in ways that enable you to compare your performance with benchmarking statistics in industry journals. From there you’ll have a clear picture of how much your hard work has improved your net worth over the year. Make financial planning and analysis a collaborative effort between you and the financial experts you trust. When armed with the right information, CPAs can answer many questions about reducing expenses and maximizing ROIs, like: • • • • •
Do my costs fall within industry standards? How can I manage my costs more effectively? How do I increase my revenue? How do I minimize my tax liability? Should I lease or buy new equipment to update my practice? • Am I maximizing my retirement contributions or spending too much on the wrong benefits? Attorneys Every business encounters situations that need the services of an attorney to prevent liability and litigation. From tax rates to partnership agreements, intellectual property rights, policy enforcement, leasing and more. To protect your business, you need to communicate openly with your attorney. Attorneys also help with contract negotiations. When you have an attorney negotiate your contracts, it usually results in better terms and benefits for your pharmacy. Third party contracts are no exception; it helps tremen-
dously to have attorneys working for you. But, paying private attorney fees for PBM contracting is costly. The best solution is to join a third party network that employs a contract attorney. Legislators Referring to legislators as business partners may seem like a stretch, but lawmakers today have more influence on community pharmacy than ever. Think AMP. Think PBM prompt pay. Think compounding. Like it or not, legislators make decisions at the capitol that affect the decisions you make in your practice. You can and should influence legislation by giving input and making sure your concerns are properly considered. Elected officials encourage communication from constituents. Educate your local legislators on the issues affecting your pharmacy. If you’re not sure how to reach them, go online. Most legislators today have their own websites. You can likely contact them by phone or email. Or, you could even write a personal letter and send it through the mail.
“Regular communication with your business partners is the only way to ensure your concerns are heard and properly addressed.” Wholesalers, Vendors & Service Providers It’s easy to overlook communicating with vendors because you’re busy focusing on connecting with your patients, but your vendors play an integral part in how you deliver value to your patients. You need to make sure that your vendors understand their important role in your business in order for them to make a better contribution. Your service and supply partners know what they can contribute better than you do. By communicating your business plan and where they fit into it, you signal your interest in greater collaboration to the benefit of your business and theirs’. Share your goals—but remember, they may be suppliers for your competition as well, so have non-disclosure agreements in place up front (your attorney can help with those as well). Provide regular communication updates to reinforce your commitment to increased collaboration.
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The Future of Pharmacy
Perspective of a Soon-To-Be Pharm.D. Kimberly Kern, PBA Health intern and Pharm.D. candidate, discusses the future of pharmacy As the pharmacy profession evolves, those just starting their careers see the profession differently than pharmacists who have been in the field for a number of years. Whether in a retail pharmacy, a hospital setting or a long-term care facility, new pharmacists have to adapt to the changing times. We sat down with Kimberly Kern, PBA Health intern and 2013 Pharm.D. candidate at the University of Missouri Kansas City (UMKC) School of Pharmacy, to discuss her plans for her future career and how she sees the profession progressing. Why did you decide to go into pharmacy? A career in healthcare has always interested me. I began college with the intention of getting a bachelorâ€™s degree and continuing on to medical school. After my first year of college, my neighbor, and local pharmacist, told me that the pharmacy she worked in could really use a technician. After applying for the job, I was hired. Almost immediately I realized that pharmacy might be the best option for me. I worked with all female pharmacists at the time and saw that they were able to
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have a successful career and also maintain a family life as well. This appealed to me, so I began the process to apply to pharmacy school. I am currently finishing up my last year of school at UMKC and will graduate in May 2013. I could not be happier with my choice of career. Pharmacy as a profession is constantly changing and evolving and I know I will be given countless opportunities to help patients throughout my career. What experiences have you had with independent retail pharmacy? I have had only minor experience with independent pharmacies. While interning at PBA Health, I have been exposed to what actually happens behind the scenes to create a setting for a successful pharmacy and business. Working at a large chain retail setting, I have always known that cost of goods is important and that contracting with insurance companies is very difficult and time consuming. I did not realize, however, how much work goes into successfully running a business. While at PBA Health I have been able to observe and partici-
OUTLOOK pate in the “behind the scenes” services that help independent pharmacies function. I now know that in order to run a successful independent pharmacy that one must be very business savvy in addition to being able to safely and effectively provide treatment to patients. What area of pharmacy do you see yourself working in? I have worked at a large chain retail pharmacy for a little more than five years and I feel pretty confident that the retail setting is where I will work. Throughout my different rotations and clinical experience I have been exposed to several different practice settings. I think that practical experience is a critical component to any successful curriculum and I have been very lucky to have excellent preceptors and diverse learning experiences. The true purpose behind these clinical and practical learning experiences, I feel, is to open the student’s eyes to the possibilities of what pharmacy as a profession can truly offer. The days of pharmacists simply dispensing medications and sending patients on their way are coming to an end and I am excited for the possibilities ahead to provide a more diverse type of healthcare. Do you have any other interests in the pharmacy field? Another aspect of pharmacy that interests me is nursing home consulting. This type of service, which is mandated by Medicare, requires that a licensed pharmacist review nursing home patients’ medical records or charts on a monthly basis. Pharmacists are the ideal candidates for this type of service, as we are able to look at a list of medications and determine if the side effects the patient may be experiencing are typical, or more serious. Pharmacists are able to identify drug-drug interactions as well as allergic reactions. Throughout school I have learned how to read and interpret laboratory values, which when combined with a current medication list, is very helpful for determining where dosages can be adjusted or medications can be changed in order to make the patient healthier. Consultation services can be done individually or pharmacies are able to contract with certain facilities and have a staff pharmacist visit the facilities monthly to perform the chart reviews. This is an excellent way for pharmacies, especially those providing long term care services, to increase their business and to allow the pharmacists to use the clinical knowledge they have been taught. Where do you see the future of pharmacy going? I understand that patients will always need monthly prescription medications and that aspect of the job does not deter me. I love daily interaction with patients
During her internship at PBA Health, Kern worked with Jim Young, Director of Third Party Services, to learn about contracting, PBMs and more. and although the daily routine does not vary much from day-to-day, I can honestly say I have never had the same day twice. Currently my store is focused mainly on dispensing medications but I hope that in the future we will move towards more medication therapy management (MTM) type of services and clinics. As a student at UMKC I have been trained in many health-related activities, such as blood pressure monitoring, diabetic glucose testing, A1C testing, INR monitoring and height and weight checks. Students are also required to become licensed to immunize. All of these activities really make pharmacy stand out as a profession. Not only can we help patients with day-today medication issues, such as adherence, but we can also be a one-stop-shop for maintenance healthcare. Instead of a diabetic patient making an appointment at the doctor to get his blood glucose checked, he could come to his local community pharmacy where a pharmacist would be able to assist him. Pharmacists areable to check blood glucose, height, weight, as well as discuss the importance of medication compliance and proper insulin injection technique. Pharmacists have long been seen as the most accessible healthcare professionals and pharmacy continues to be one of the most trusted professions. I think that this makes pharmacists the perfect people to help patients understand their health. All of these aspects just begin to touch on the possibilities that pharmacists moving forward in the future will have. As I approach graduation the thought that my days at school are over is really starting to hit me and I can’t wait to see how the profession will grow and evolve as I begin my career and continue to practice.
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Things You Didn’t Know About PBA Health
When your pharmacy joins PBA Health, you start buying, operating and selling more efficiently—and profitably. We created every product and service we offer to encourage the success of a community pharmacy as a business, as well as a clinical practice. Whether you are a long-time customer or you just joined one of our services, we’re curious how much you know about PBA Health and what we offer? Here are ten facts that you may not know.
1 Customer Service We care about our customers. When pharmacists have questions about their orders, contracts or any PBA Health service, they know that assistance is only a phone call or an email away.
2 Purchasing Technology Our unique back-end reporting system can help you track and manage your costs and buying opportunities. With the ProfitGuard program, monthly purchases and wholesale recommendations are available at your fingertips. Total transparency is built right in.
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Contract Management From expert negotiations to audit support, pricing appeals, recoupment services, CMS compliance assistance and much more, TriNet Third Party Services takes care of your pharmacy.
Reconciliation Service What other service helps you increase productivity, reconcile third party claims and also provides detailed reports on payment discrepancies and aging receivables? EnsurePay is the electronic solution that saves you money!
4 Keeping Money In Your Pharmacy For pharmacies that want to offer maximum value to cash customers while also increasing cash claim revenue, ScriptCard and ScriptCard Plus prescription discount cards provide the ideal solution.
5 99.99% Order Accuracy For your primary or secondary purchasing needs, you can place your Negotiator or PBA Online orders confidently through the PBA Health Warehouse.
6 Industry Knowledge & Relationships We work with our vendors and our pharmaceutical wholesalers every day to make sure that you receive the best cost of goods on the products you sell.
8 Reaching Your Customers If your pharmacy has the services patients are looking for, how will they know if you don’t tell them? PBA Health’s marketing services can help you get the word out, whether online, with direct mail, or through customized campaigns.
9 Annual Conference Important CEs, informative speakers, and a collaborative environment are part of the PBA Health Conference in Overland Park, Kansas every summer.
10 Easy Online Ordering Users of PBA Online and the newly introduced Negotiator get the best deals out there. To learn more about these, and any PBA Health service, call 800-333-8097 today!