On The Cover
Sonya Collins
Rapidly falling reimbursement rates and stiff competition from large corporate pharmacy models are forcing pharmacists to make difficult decisions. According to the National Community Pharmacy Association (NCPA), more than 300 independent community pharmacies closed their doors last year, and the chain community pharmacies weren’t immune either. Many are paring down their numbers as well.
There are 2,200 fewer retail community pharmacies open today than 4 years ago. Nearly one-third of independent pharmacies who answered a 2024 NCPA survey said they may shutter this year due to falling reimbursement rates. Others are cutting hours, staff, and services just to keep going.
However, other community pharmacies are expanding their offerings to become less reliant on prescription reimbursement.
“Pharmacists have to be innovative and constantly find ways to make sure they are able to meet their bottom line and keep their doors open for the community,” said Jade Ranger, PharmD, co-owner and operator of the Prescription Shoppe in Williamsburg, VA.
For pharmacists looking to diversify their revenue streams, these are some trends to watch.
Automated pharmacy kiosks
Research suggests that automated pharmacy kiosks might improve patient adherence, which means customer retention, and they could make a quantifiable impact on the pharmacy’s bottom line as well.
Authors of a 2021 study published in the March/April issue of JAPhA looked at prescription pick-up rates, counseling duration, and patient counseling experiences over a 35-month period at both an automated kiosk and the filling pharmacy.
The study participants were health system employees who were given the option of either picking up their prescriptions from an automated kiosk in the hospital lobby or from the filling pharmacy 2 miles away. The filling pharmacy operated Monday through Friday from 8:30 am to 5:30 pm. The kiosk was accessible 24/7.
The study’s key findings were that prescription abandonment rates were lower at the kiosk; pharmacists agreed that their ability to provide counseling (which takes place over live video through the kiosk) was the same at the kiosk and in the regular pharmacy; and patients were satisfied with their access to a pharmacist at the kiosk.
Small increases in prescription pick-up can make a big impact, according to Jan Hirsch, PhD, BSPharm, coauthor of the JAPhA JAPhAstudy.
“From a financial standpoint, according to the pharmacy that we worked with for this study, it costs $30 for each prescription they have to put back in stock,” she said.
The pharmacy involved in the research avoided an estimated 4,000 prescription returns during the study period, which saved $12,000.
Automated pharmacy kiosks may improve inefficiencies in the pharmacy, allow for pharmacists and technicians to provide other services, and increase patient retention. At least 10 states have legislation that allows for the use of automated pharmacy kiosks.
Point-of-care testing
A growing number of pharmacies are offering point-of-care CLIA-waived tests and test-and-treat services, which can increase revenue through the service itself and by way of the new patients it draws into the pharmacy.
According to NCPA, most people who turn to pharmacies for point-of-care testing (POCT) are between the ages of 18 years and 44 years, do not have an established primary care provider, and at least a third of them are uninsured. In this market, pharmacists can charge competitive prices that beat those of urgent care facilities. Reduced wait times and a more streamlined process might also give POCT in a pharmacy an edge over testing in physicians’ offices and urgent care clinics.
Middletown Pharmacy & Wellness in Louisville, KY, offers the tests most commonly sought during respiratory season: COVID-19, influenza, strep throat, and RSV. Through a collaborative practice agreement with a local physician, pharmacists have the authority to prescribe and dispense the appropriate medication after a positive test.
The pharmacy offers individual tests for respiratory illnesses for about $30 to $50 each or in bundles for under $100.
“During respiratory season, this boosts revenue by five or, during the peak of the season, up to 10 grand a month,” said Tara Schneider, PharmD, who co-owns Middletown Pharmacy & Wellness with her husband, Chuck Schneider. The couple also run the Point of Care Testing Institute, a program of online courses that prepare pharmacists to launch a POCT business in their own pharmacy.
While tests for respiratory illnesses may be the most common ones offered in pharmacies, they are far from the only ones pharmacists can offer.
In addition to respiratory-related tests, the Prescription Shoppe in Williamsburg, VA, offers HIV and hepatitis B testing. Prescription Shoppe pharmacists completed HIV test training through the Virginia Pharmacy Association and the Virginia Department of Health. In this program, pharmacists learn the proper protocols for communicating positive results to patients and getting patients into care at the local health department without delay.
Testing and other services offered at the Prescription Shoppe have been critical to keeping their doors open, Ranger said.
“PBMs and DIR fees are just terrible for pharmacies right now, both the independents and the chains, so if you don’t have another revenue stream, there’s no way you can make it,” she said. “Just filling prescriptions alone is a thing of the past.”
NCPA’s website includes resources and guidance for pharmacists looking to set up a POCT business. APhA offers a pharmacy-based test and treat certificate training program that provides learners with experience in identifying opportunities to expand patient-centered services across pharmacy settings with POCT. Visit www.pharmacist.com/Education/Certificate-Training-Programs/Pharmacy-Based-Test-And-Treat to learn more about this program.
Telehealth and remote patient monitoring
The growing acceptance of, and in many cases demand for, telehealth services to meet all applicable health care needs has carved out a market for pharmacists to administer patient care virtually.
ReNue Pharmacy, a community pharmacy in Dallas, TX, employs telehealth to manage complex primary care patients referred by a partnering primary care clinic. The pharmacy also offers remote patient monitoring for hypertension, diabetes, and blood oxygen saturation. Both services are billed incident to the partnering primary care provider.
“Pharmacy primary care is absolutely an area that we need to continue to move forward through and explore as the crisis in primary care access continues, especially in rural and underserved parts of the country,” said Raj Chhadua, PharmD, who owns and operates ReNue Pharmacy.
Until the COVID-19 pandemic, ReNue was a typical community pharmacy. During the pandemic, a primary clinic adjacent to the pharmacy asked for support managing patients with hypertension and diabetes. Now, pharmacists at ReNue provide disease state management via telehealth to patients between their routine visits with their physician.
“We ensure that the patient is compliant with their medication, coach the patient, and make sure there aren’t any other complications,” Chhadua said.
Through Seva Care, a pharmacist-led health technology company, ReNue provides remote patient monitoring. ReNue pharmacists monitor patient BP, for example, through a Seva Care device and make necessary adjustments to patient medications as BP changes indicate a need. This service has led to improvements in patient outcomes as well as identification of cardiac events the moment they start to occur. While remote patient monitoring has been around for some time, it is often carried out by providers at a distant call center. Chhadua noted that patient retention is better when the area pharmacist who already has a relationship with the patient is the one monitoring them.
“If anything looks out of the norm,” Chhadua said, “the pharmacist can call the patient, talk to them about their therapy, and the patients actually pick up the phone because they know their pharmacist and they recognize the number.”
Changes made by CMS in 2020 allow pharmacists greater authority to oversee remote patient monitoring and bill for those services.
Billing and coding
The increasing numbers and types of services pharmacists provide reflects their expanding scope. As that scope continues to broaden, pharmacists will need more expertise in medical billing and coding.
“The pharmacy profession has been strongly pushing for federal provider status. If we got that today, everyone would be excited, but no one would know how to bill at the appropriate level,” said Eric Dietrich, PharmD, a clinical associate professor at the University of Florida College of Pharmacy. The board-certified ambulatory care pharmacist is also an American Association of Professional Coders (AAPC) certified professional coder.
Dietrich took the medical coding course and certification exam in order to be able to properly bill for pharmacy services and obtain more reimbursement at the internal medicine clinic where he sees patients.
“The biggest barrier to using pharmacists in clinical practice settings has always been financial,” Dietrich said. “Most every provider would be happy and willing to collaborate with a pharmacist. They just don’t want to pay $150,000 out of their pocket to do it.”
Dietrich’s attempt to bring in more reimbursement for pharmacy services at his clinic was successful, and other pharmacy faculty at the University of Florida have followed his lead, which he said, expands access to care for patients and opportunities for pharmacy practice and training.
As pharmacists’ scope expands and more pharmacists are providing clinical services in ambulatory settings, colleges of pharmacy may need to teach billing and coding, Dietrich said.
“Right now,” he said, “the place to train pharmacists in billing and coding is residency training for those pharmacists who are committed to going into ambulatory care.”
While health systems and ambulatory clinics employ billing and coding professionals, community pharmacies—should they choose to provide patient care services—don’t typically have the infrastructure to bring in a billing professional. Pharmacists in community settings may look to their state professional associations for support.
“The biggest champions of this right now are the state pharmacy associations,” said Olivia Welter, PharmD, director of professional affairs at the Tennessee Pharmacists Association (TPA). “They’re the ones who have the time to devote to making resources, doing site visits, helping pharmacists get this implemented, meeting with different software vendors. I’m seeing a lot of that leadership at the state association level.”
TPA provides support and resources for pharmacists in the state who want to be credentialed as providers so they can contract with and bill health plans. The association has online resources for pharmacists going through the credentialing process to set up themselves for medical billing. TPA also walks pharmacists through this process by phone as well.
The Washington State Pharmacy Association, as another example, provides links on its website to continuing education modules on billing and coding for pharmacy professionals and a guidebook Pharmacy Practice Guidebook: Medical Billing, Coding and Documentation for Pharmacy Professionals.
Pharmacists wishing to bill insurance for clinical services can take the arduous route that Dietrich did, but he warns, the pricey AAPC course includes 20 hours of online instruction and an 800-page text. Working through the material nights and weekends took him 8 months.
“It’s like picking up a textbook on astrophysics,” he said. “Yes, all the information is in there, but if you don’t speak the language, it’s hard to make sense of it and make it actionable.”
While professional certification might not be the right path for every community pharmacist, it would be wise for independent pharmacies to make a plan for how they will eventually begin coding services and billing for them when the time comes, Welter said.
“Most independent pharmacies are always looking for new revenue streams,” she said, “because they are under-reimbursed. So, on the independent side, we’re seeing a push toward more pharmacists wanting to get engaged with it.” ■