Specialty Pharmacy is your friend…sometimes
I have a “like” (never love) and “hate” relationship with Specialty Pharmacies. Likewise, there are infusion providers that wouldn’t accept a Specialty Pharmacy shipment under any condition and others who wouldn’t Buy&Bill a medication if it cost more than $20 a vial.
Our last post provided a brief overview of both Buy&Bill and Specialty Pharmacy (“SpecRx”) strategies for the in-office or stand-alone Infusion Center provider. In that writing, we mostly focused on why and when you should consider a Buy&Bill inventory strategy to leverage your practice profitability. If you missed it, take a moment to read our previous post To Buy&Bill or not to Buy&Bill… for more context for this discussion. Here, we will look more closely at the Specialty Pharmacy inventory strategy and discuss how and when this alternative option might benefit your operations and your patients.
If you read our previous blog post, then you already know that I don’t advocate for either an all Buy&Bill or all SpecRx extreme except in very special situations. The vast majority of providers fall somewhere in the middle of these options in an attempt to balance patient access to the medications they need and stewarding a sustainable and profitable infusion service.
Let’s establish first, that while a Specialty Pharmacy strategy will off-load the majority of the medication financial risk, it is not completely without cost to the provider. To start, Specialty Pharmacies always bring a third party into the patient care coordination effort. A member of your office team will need to interface with the SpecRx to order, authorize, and confirm each and every patient-specific medication shipment. In my experience, this call is almost never with the same SpecRx representative and can be both time consuming and frustrating depending on the knowledge of the pharmacy representative. This quarterbacking can eat up serious time as your team attempts to get everything lined up for the patient’s appointment date. In addition to staff time, there is an additional cost associated with the need to segregate patient-specific SpecRx medications from Buy&Bill inventory. If you don’t keep a clear dividing line between these very different inventories, you risk your clinical team using Buy&Bill medications for a Specialty Pharmacy patient – effectively, giving away some very expensive drugs.
Having said everything above, SpecRx is not the root of all evil in your office. There are some very good reasons and situations when you should consider using a SpecRx strategy.
When to Consider using Specialty Pharmacy (SpecRx) Strategies:
Free-drug/Patient assistance programs
- OK, so this one was obvious. Any self-respecting provider knows that if the only way for one of your patients to access the drug they need is through a SpecRx arrangement then you should oblige for the sake of your patient.
- I am not saying that you open the office up to every free-drug program or patient in your area, but consider the merit of these programs as many of these patients use these programs as a bridge while transitioning to another insurance provider.
Brand-spanking new medications
- Covered briefly in our Buy&Bill blog post, I again want to encourage providers to learn the supply chain, clinical, and billing nuances of a new-to-market medication before taking on the financial risk.
- Newly approved medications that have temporary J-codes (J3490-J3590) can complicate both your pre-infusion workflow and your payer collections process. New medications usually do not have clear utilization guidelines from either private or government payers.
- Using the Specialty Pharmacy option in the first 6-12 months of a new drug launch is a conservative and wise way to work the kinks out of your process while limiting your financial exposure to the unknown.
- For those of you mumbling about the sizable profit that can be made in the J3490-J3590 environment, that is your call of course, but we will dedicate another blog post for this scenario. Stay tuned, and hold your emails.
Uncommonly used, or unfamiliar medications
- None of us are experts in everything, but our teams get pretty good at buying, managing, treating, and billing the most common infusible/injectable medications through experience and repetition.
- Buying & Billing one-off medications or any rare medication that your team does not keep up with routinely can cause issues as your team may not stay as up to date on the dynamic variables associated with private and public payer utilization guidelines, LCD’s, pricing programs, FDA label changes, etc.
- If the medication is not commonly infused in your office, it is likely not going to be a major profit driver in your big picture. It can, however, become a big financial distraction that slows down your main line workflow.
Crazy expensive or risky medications
- I won’t mention any by name here. We all have those medications that keep us up at night every time we inventory them. Depending on your Replacement Risk tolerance (discussed in our previous post), it may just not make sense to take the Buy&Bill risk on a single drug that your office can’t afford to screw up.
- Some medications, especially those with FDA orphan disease designation, can be as much as $100,000 per treatment. Even when very good Buy&Bill profit opportunities exist for these meds, don’t let them steal your peace of mind by keeping them in the refrigerator with your office name on the invoice.
No inventory strategy is perfect, but we hope these suggestions and articles are the catalysts to more discussions about how to improve your operations and increase patient access to specialty intravenous and injectable medications in your practice and Infusion Center. With both Buy&Bill and Specialty Pharmacy inventory processes, efficient systems are needed to ensure that your strategy is implemented consistently and is accurately maintained for your chronic patient population. In the current environment of expensive and complex specialty biologicals, not having a process or a system to manage purchasing and inventory is no longer an option. (We are partial to one particular system we would love to tell you about)
In our next post, we will discuss situations when a location might use a “Specialty Pharmacy Only” approach to managing their inventory. Keep up with all our post and updates on our IV Insights page at https://weinfuse.com/infusion-center-blog/