Predictions for 2015 ––>

we begin a new year, we
decided that an annual
forecast of market changes
would be in order. What
follows is what we
believe will have the
greatest impact on
pharmacy this year.

of Jan. 1, pharmaceutical
manufacturers must now
provide the transaction
information, statement, and
history to the direct
purchasers of their products
in the supply chain. If this
information is not available,
the purchaser is expected to
quarantine the product until
they can resolve the
pedigree issue. If
manufacturers are not ready
for this requirement,
we may see product
shortages that could
negatively affect patient
care until these issues
are resolved.

will be required to
obtain the same
information from their
trading partners
beginning on July 1, 2015.
We expect a flurry of
activity in the first half
of 2015 as supply chain
participants determine the
best method to handle these
requirements. The FDA
provided draft guidance on
Nov. 27 last year that
stated, “Trading
partners can utilize
current paper-based or
electronic-based methods for
the interoperable
exchange of data to
provide product
tracing information to
subsequent purchasers as
long as the selected
method(s) allow
information to be exchanged
in a manner that complies
with the requirements
of section 582 (b)(1),
(c)(1), (d)(1), and
(e)(1) of the FD&C Act.
Such methods could include,
but are not limited to,
the use of:

  • paper
    or electronic versions of

  • paper
    versions of packing slips;

  • electronic
    data interchange
    (EDI) standards,
    such as the 856 Advance
    Ship Notice (ASN), which
    is currently used to
    provide the receiving
    entity with advance data
    on shipments; and

    (Electronic Product Code
    Information Services),
    which defines a data-sharing
    interface that enables supply
    chain partners to capture and
    communicate data about the
    movement and status of
    objects in the supply chain.”

expect the industry to
focus on the electronic
transfer of this
information, as a
paper-based system, while
nostalgic, will prove
difficult for all
participants to manage.

by the Affordable
Care Act and Medicare Part
D benefit designs, an
increasing number of
consumers are now fully
aware of the actual price
of their prescription
medications. Each year,
fewer people are insulated
from prescription
drug pricing due to a
decline in flat dollar
co-payments. These flat
dollar co-payments
are being replaced by
percentage-based co-payments,
which ensure that the
consumer pays a defined
percentage of the total
prescription cost. In
addition to percentage
co-payments, some
commercial plans have
implemented deductibles,
where the patient pays
100% of the product or
service price until the
deductible is met.

pharmacists, you should
expect more questions from
patients about the price of
their medication,
both before and after the
claim adjudication.
If you are aware of a
patient with a deductible or
co-insurance, it may be
advisable to alert him or
her as to the amount he or
she will need to pay after
you adjudicate the claim, but
before completing the
dispensing process. This

admittedly becomes more of a challenge with prescriptions that are e-prescribed, or phoned in versus
dropped off at the pharmacy. While patient-pay amounts will most often be based on the agreed-upon network rate
with the third-party plan, it may be advisable to review your usual and customary cash pricing at this time.

should anticipate
additional questions from
patients about the price of
their prescription
and lower-cost therapeutic
alternatives. This is an
opportunity to evaluate a
patient’s medication
profile, counsel him or
her on the importance of
taking the prescribed
medication as directed, or
suggest alternatives,
which may require
contacting the prescriber.
You may also want to
consider the availability
of co-pay cards or
tablet splitting, if
appropriate, for specific

see reimbursement
rates continuing to
decline as payers face
additional pressures with
new, expensive medications,
risk-sharing arrangements,
and rate guarantees for
their clients. This battle
between third-party
insurers and pharmacies has
existed for over 30 years
and will continue into
the future. Narrow
pharmacy networks are a
growing trend. This is where
payers negotiate
deeper pharmacy
network discounts in
return for a degree of
exclusivity, where at least
one major national chain
is excluded. This
theoretically increases the
pharmacy target
population and prescription
volume from this payer, in
return for an additional
discount. Payers have
now found that employers are
willing to force
employees to change
pharmacies if it means a
lower out-of-pocket
co-pay or lower premiums
for employees and lowers the
employers’ premiums.

network expansion can
best be seen in Medicare D,
where over 70% of
beneficiaries are enrolled
in a preferred network. In
this scenario, the patient
pays a lower monthly
premium if he or she elects
the preferred network
option, and enjoys lower
co-payments at preferred
pharmacies. As this is
written, many Medicare D
patients are receiving
letters about their narrow
network pharmacy
options and how to
transfer their prescriptions
to a preferred pharmacy

need to be proactive in
their negotiations
with payers to understand all
network options and
evaluate the level of brand
and generic discounts they
can offer for that plan’s
mix of business.
Pharmacies should also
consider the front-end
value of the patient in
this calculation.
Additionally, pharmacies may
wish to evaluate their
prescription volume and
fixed overhead should they
lose access to a
third-party plan.
Pharmacies that use a
Pharmacy Services
Administration Organization
(PSAO) to negotiate
third-party contracts
should proactively
discuss narrow network
participation rates and
pharmacy certification
with their PSAO
representative to both
understand and ensure that
the pharmacy’s needs are
being addressed.

and Documentation
addition to reimbursement
rates, pharmacy
certification is
increasingly mentioned as a
criterion for a pharmacy to
dispense certain
medications. Originally
seen as a means to limit
the dispensing of specialty
medications to only
pharmacies that met
certain standards,
certification by a
third-party organization
may be a future
requirement for network
participation. The
Utilization Review
Accreditation Commission
(URAC) is one example of an
accreditation organization.
CVS earned URAC’s first
community pharmacy
accreditation this past
summer. Measurement
and documentation
are key components in
pharmacy certification.
Policies and procedures
that detail how a pharmacy
meets a particular
standard or service level
are essential in pharmacy
certification. The subsequent
reporting of the activities
demonstrates the pharmacy’s
proficiency and is the
output that is measured to
determine compliance
with the standard. We
expect more certification
requirements of pharmacies
to participate in narrow
networks and differentiate
the network for the
payers’ clients.

pharmacy leads the industry
with online adjudication
for payment of prescriptions.
However, pharmacy lags
behind in documentation
and measurement of
service-level activities,
including when a prescribed
medication is not dispensed
due to a duplicate
therapy flag or drug
interaction alert.

service-level activity that
should be tracked is the
time spent training
patients on how to use a
device (inhaler or
injection device) to
administer their
medication. Pharmacies
should examine how their
pharmacy management
system can document and
report various nondispensing
activities. If you are
evaluating a new pharmacy
system, inquire about
how nondispensing
activities can be tracked.
Does the system allow
you to document and
report interventions
and outcome codes? We
believe that reporting the
nondispensing activities
will become increasingly
important in the future for
payment of services.

expect 2015 to be another
year with a variety of
opportunities and challenges
for retail pharmacy. CT

Kosty, R.Ph., M.B.A.
is president, and
Dietz, R.Ph., M.S.
is vice president, at
Pharmacy Healthcare
Solutions, Inc., which
provides consulting
solutions to pharmaceutical
manufacturers, PBMs, retail
pharmacy chains, and
software companies on
strategic business and
marketing issues. The
authors can be reached at
tkosty@phsirx .com and