Revenue
Lauren Howell, PharmD
A study from the November/December 2024 issue of JAPhA found that over a 3-month period, there was a difference of over $16,000 between the actual revenue that was generated and the potential revenue that could have been generated if pharmacists were able to bill for their services in an ambulatory clinic.
These findings indicate that the value of pharmacists may be underestimated if value is based solely on revenue generation.
Study design and results
This retrospective study utilized a chart review of data from January 1, 2022, to April 6, 2022, from a single ambulatory clinic served by a 0.5 full-time equivalent pharmacist serving chronic disease management and patients with COVID-19. For each appointment during the study period, the chart was reviewed for elements that would meet the requirements for current procedural terminology (CPT) billing codes. Medicare and Medicaid reimbursement was based on the official 2022 Physician Fee Schedules and private insurance reimbursement was set at a single rate of 60% of the fee schedule of the most common private payer.
Over the 3-month period, 118 patients were seen by the pharmacist. The amount paid to the clinic was estimated to be $2,174.91. The hypothetical amount that could have been paid to the clinic if pharmacists were billable health providers was found to be $10,415.31 for chronic disease management and $7,953.48 for COVID-19, totaling $18,368.79. This provided a total unrealized revenue of $16,193.88.
What do these results mean for pharmacists?
Despite a growing body of evidence that pharmacists positively impact patient outcomes and the cost of care, pharmacists are not recognized as billable health care providers under Medicare Part B or most government and private medical plans. Pharmacists seeking payment for services provided in the outpatient clinic setting often utilize incident-to-provider billing. The CPT code used in this situation is the evaluation and management code and signifies a nonmedically complex appointment with a nonqualified health care provider for an established patient. This code is one of the lowest revenue-generating codes for services in the outpatient clinic setting and does not properly reflect pharmacist management of complex disease states and medication regimens.
These billing limitations can make it difficult for pharmacists to prove the value that they add to the health care team. The discrepancy between the medically complex patients that pharmacists are serving and the minimal reimbursement that they receive for this service creates an imbalance between completed work and generated revenue.
Pharmacists may be expected to make up for this low revenue by seeing more patients in a day, potentially impacting the quality of care that patients receive. Additionally, outpatient clinics may simply decide not to employ pharmacists at all due to the lack of reimbursement.
Several study limitations were identified by the authors including telemedicine COVID-19 appointments being coded as in-person, a highly insured patient population that may affect the real-world translation of the data, a potential spike in COVID-19 cases due to the study period including winter months, and the part-time nature of the pharmacist. Additionally, revenue generation estimates were based on the most common payers at this specific facility, so these numbers could differ across geographic regions and payers.
The authors recommended further studies including converting these data to relative value units using clinic-specific metrics and exploring telephonic-based billing codes. They also recommend performing similar studies including an expanded list of billing codes, besides those for COVID-19 and chronic disease management. The researchers believed that these data had the potential to be useful in support of advocacy efforts related to pharmacist reimbursement for services delivered. ■