Nick Karalis, R.Ph.
Nick Karalis, R.Ph.

Nick Karalis, R.Ph., didn’t get into pharmacy with the idea of running a specialty operation that’s grown into a 17,000-square-foot headquarters building outside of Philadelphia, Pa., and recently acquired two specialty pharmacies: one in Charleston, W.Va., that focuses on HIV and oncology, and one in Glen Rock, N.J., that focuses on fertility. It all came about through a very natural progression of leveraging the expertise he was developing, which may make his path all the more illustrative of what other pharmacist out there can do. Karalis has owned retail pharmacies since 1994. In 2003, he bought Elwyn Pharmacy, a community retail pharmacy that was doing some LTC. By 2006 he’d expanded more into nursing homes and skilled facilities, and really built that side of the business.

Then just two years later he opened Elwyn Specialty Care, based in Glen Mills, Pa. “Specialty was a natural progression to us, because of the kinds of patients we were caring for in nursing and skilled facilities,” says Karalis. “We already understood the importance of compliance and refill reminders and making sure that patients take their medicine on time, every day.” While these skills were not mew at Elwyn Pharmacy, Karalis saw a trend of pharmacies repackaging these skills and calling it “specialty” when applied to certain expensive, high-tech, and high-touch medications. “Well, we were doing this with all of a patient’s medications, so we felt we’d be in a perfect position to build programs and models around that,” says Karalis.

Building the Team

Karalis began by investing in resources and staff for a sales team, a customer service team, and clinical pharmacists, all dedicated to specialty. “Most of this we already had,” he says. “But we reallocated them to put them in charge of specific conditions that we were going to focus on.” And how does Karalis decide what constitutes a specialty pharmacy opportunity? At its most basic, people define specialty by the cost of the medications. But there’s a more clinical and, Karalis thinks, more accurate way to look at it. Specialty pharmacy focuses on medications that are high cost, yes, but that also treat chronic complex disease states, have a lot of side effects, and require a lot of support. These are medications that, before you even dispense them to the patient and have a clinical conversation about them, you need to address a range of administrative tasks, such as prior authorization, reimbursement assistance, and appropriate-use determination. “When a prescription comes into a specialty pharmacy,” explains Karalis, “you have a team of people who touch it before you even consider giving it to the patient.”

For example, Karalis estimates that over 90% of specialty medications require prior authorization, with every insurance company having thresholds for appropriateness, and many of them also having step therapies. Then you have to address the co-pay. For example, offers Karalis, a senior oncology patient who has Part D may have an approved claim with a $2,500 co-pay that he can’t afford. “Where do we go from there?” asks Karalis. Brand manufacturers have co-pay cards that help absorb the cost, but you can’t use them for government-sponsored plans. So you have to turn to foundations. “You are then working on behalf of the patient to submit information to get money from these foundations to cover the co-pay,” says Karalis. “The good news is that we’re very successful at doing this.”

These claims also come in with significant clinical information attached, such as labs and a whole array of chart information. Again, this was the same space Karalis was in with his LTC pharmacy. “We were used to seeing charts and lab values and having our clinical pharmacists review them and make recommendations,” he says. “So in our practice, it was, okay, we’re going to expand what we’re already doing.”

“Only at this point, when we’ve cleared the administrative and clinical tasks, do we start to talk with the patient about the medication, about the disease state, and what we can do to help manage that,” says Karalis.

The Technology

It’s not surprising then that specialty pharmacy places very particular demands on technology. Karalis is using pharmacy management software from HBS. And while it isn’t specifically a specialty system, it is the retail and LTC system that he’s built his operations on to date. He’s had good success in modifying the LTC system, in particular, to support the specialty business.

One area of particular importance for specialty is reporting, which has to meet very specific needs if a pharmacy is going to participate in specialty pharmacy limited networks. “For example, if you are going to be in a third party’s specialty pharmacy contract,” says Karalis, “you are responsible for reporting certain information on outcomes and your performance. You can be financially penalized if the reporting isn’t done or if you don’t meet standards. Your data has to be accurate and delivered correctly in a timely fashion.”

The fulfillment area at Elwyn.

Reporting is also important to a specialty pharmacy’s customer service and sales force. Karalis has been able to use features already in the HBS system for this, with more robust features coming soon. “It’s critical for your pharmacy system to be able to segregate your specialty claims and collect all the data you need so you can really understand that part of your business,” he says. At Elwyn Specialty Care, Karalis tracks every referral that comes in by sales person, disease state, and referral source. “The fact that this is being done within the pharmacy system, rather than in some other software package, makes it far easier for us to understand our business,” he says. “We can more easily combine our sales- and customer-service-generated data with pharmacy data such as acquisition cost, djudicated payments from third parties, and more.”

The Patient

Documenting patient interactions is another key application for technology in specialty pharmacy, though one where Karalis would like to see some innovation. Elwyn Specialty Care uses a mix of homegrown and commercial software for this, and then integrates that data as best it can back into the pharmacy system. “The results after each touch with a patient get recorded and scanned in through a feature in HBS that lets us scan in an unlimited number of images for each new fill or refill and connect these to the patient profile,” Karalis explains. “So if we speak to a patient 10 different times, the documentation for each of these interactions is scanned in and we can see them in chronological order.” It works, but it’s not seamless. And, in Karalis’s opinion, integrating this kind of patient management documentation into the pharmacy software is somewhere that specialty system developers really need to go. “In a perfect world,” he says, “what I would like to see is a pharmacy system that lets you build your own clinical protocols within it and work with this data right within the pharmacy platform itself.”

Collaborate to Capture the Right Data

What’s ultimately really critical is capturing and putting to use data elements that are not traditionally part of the patient record in a retail-oriented system, and generally not even considered by community pharmacy. Karalis already has experience with this from the LTC market, where pharmacy has developed integration to eMARs and EMRs that help them understand much better just how well patients are doing in managing their conditions. “We are going to have the opportunity to bring the same level of automated patient adherence management to specialty as we have in LTC,” says Karalis. For example, in most retail pharmacies a patient can fill a prescription for potassium, and the pharmacist won’t ask what the patient’s potassium levels are. “In specialty, just as in nursing homes and skilled facilities, you always need to know what that lab value is,” says Karalis. And so specialty technology going forward needs to be able to collaborate with a range of other data systems — EHRs, HIEs, physician and hospital systems, and more — from across the healthcare spectrum. “We’re going to have a greater and greater need to integrate and collaborate,” says Karalis. CT