Tipping the Scales on Quality — One Patient at a Time

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Established in March 2016 through a joint venture between American Associated Pharmacies‘ United Drugs and H. D. Smith’s Third Party Network, Arete Pharmacy Network has earned a reputation as a quality-focused pharmacy services administrative organization (PSAO) in the independent community retail pharmacy market. For a pharmacy in today’s healthcare environment, star ratings and performance scores are essential to achieving revenue goals. With a portfolio of IT-based solutions that address financial, quality, and operational challenges, Arete helps independent pharmacies stay ahead of the curve. Darla Bodnar, R. Ph., director of clinical services, describes how Arete Pharmacy Network’s Quality Center helps member pharmacies achieve and exceed performance goals.

ComputerTalk: What is the Quality Center, and how does it serve the pharmacy and/or patient?

Darla Bodnar

Darla Bodnar: The Quality Center is a comprehensive, web-based platform (exclusive to member pharmacies of Arete Pharmacy Network) that offers tools and resources for improving performance ratings. The Quality Center uses real-time data to ensure that a pharmacy is well-placed to make adjustments that will ultimately impact scores. The core value that the Quality Center delivers to pharmacies is actionable insight into patient behavioral patterns such as medication adherence and high-risk medication, as well as statin use by diabetic patients. These behavioral patterns have a potential impact on performance scores. 

View a three-minute video to learn how the Quality Center works.


CT: Financial health and patient outcomes are primary concerns for owners. How does the Quality Center help with these?
Adherence, high-risk medication use, and statin use by diabetic patients factor into how a pharmacy’s performance rating is calculated. In many instances, these parameters are the driving factors for clawback charges and pay-for-performance bonus payments. Many Medicare Part D preferred plan contracts include a quality-based clawback charge or direct and indirect remuneration (DIR) fee, which can lead to the assessment of hefty charges. Some DIR fees are calculated using a percentage of ingredient cost paid, while others use a tiered flat-fee approach. The common thread that runs through these Medicare Part D contracts is the ability to “buy down” or lower the DIR clawback by enhancing performance ratings.

CT: Explain to us how the benefits of the Quality Center are aligned with CMS star ratings.

Bodnar: The Quality Center utilizes the same National Drug Code (NDC) lists used by the Centers for Medicare and Medicaid Services (CMS), as provided by Pharmacy Quality Alliance (PQA). The formula for calculating star ratings measures at Arete Pharmacy Network is adapted from the CMS star ratings methodology. The dashboard feature in the Quality Center allows a user to view current performance scores. These performance scores are provided by specific health plans and are calculated by the Electronic Quality Improvement Platform for Plans and Pharmacies (EQuIPP). CMS utilizes the pharmacy’s performance scores to calculate a Medicare Part D health plan’s overall star rating, which leads to multiple perks for that health plan — the most significant of which are robust bonus payments. A health plan’s star rating comprises multiple factors, over 50% of which are attributed to pharmacy services such as adherence.

CT: Adherence and medication therapy management [MTM] are operative words in the independent pharmacy market. How has the Quality Center’s offering differentiated Arete from other PSAOs?

Bodnar: Adherence to cholesterol, diabetes, and hypertension medications make up a large percentage of star ratings, clawback charges, and year-end bonuses. Adherence scores for participating pharmacies in Arete’s Network continue to show a steady rise — 3% year over year (YOY) from 2015 to 2016, a clear demonstration of the Quality Center’s value. The increase in scores for adherence, statin use in diabetes, and high-risk medication, combined with increases in completion rates for MTM, have resulted in reduced DIR fees or clawback charges from a major Medicare Part D payer by nearly $1 million on an annualized basis.

An April 2017 report prepared by Pharmacy Quality Solutions showed that our member pharmacies placed first in nine out of 25 comparisons for five major payers in the Medicare Part D space, when ranked against PSAOs of similar size. This figure represents a 45% increase from 2015. The steady upward trend observed for adherence scores and other performance measures saves pharmacies money and sends a quantifiably positive message to pharmacy benefit managers (PBMs) and health plans. High performance is an attractive attribute that leads to a stronger footing in payer interactions, as well as greater access to patient lives.

Avid users of the Quality Center have had quantifiable success in increasing quality scores, and subsequently, decreasing clawback charges while adding additional revenue through MTM. CT

For more information about Arete Pharmacy Network, visit www.areterx.com.