As the healthcare landscape undergoes accelerating change, almost every clinical and operational area within health systems must evolve to keep pace, including pharmacy operations. Managing medications across an increasingly complex health system is both challenging and expensive, with pharmacy teams often spending too much time managing medication and not enough time with patients. Many health systems are leveraging technology and data to help them better manage resources and medications while also gaining analytics-based insights to improve operational efficiency.
At Greenville Health System, an eight-hospital system based in Greenville, South Carolina, pharmacy operations leaders have deployed an enterprise software solution designed to provide real-time visibility and actionable insight to improve pharmacy operations. Greenville Health System pharmacy teams currently manage an increasingly complex pharmacy landscape with ambitious drug savings goals, several 340b facilities and 200 physician offices and all eight hospitals to support.
In February 2017, Greenville established its Greenville Pharmacy Consolidated Service Center (PCSC), with the overall goal to build a model pharmaceutical supply chain and pharmacy business center to manage GHS resources and assets on an enterprise-wide level.
Matt Parker, PharmD, manager of consolidated pharmacy services at Greenville Health System (GHS), says there are a number of supply chain and operational challenges facing pharmacy operations. “The first thing that comes to mind when you look at a large integrated delivery network such as ourselves is logistics, and efficiently moving product from point A to point B, within a large health system. You know you have X number of locations, with all the pharmacy needs and pharmacy services, and you have to move that product around, and it’s not always necessary to have a pharmacist or complete pharmacy at all those locations. So, you have to rely heavily on technology, whether it’s an automated dispensing cabinet or some other type of technology that gives you visibility into the inventory there, but also helps you get inventory from point A to point B,” he says.
In addition, increased pharmacy costs, regulatory pressures and decreased reimbursement also are challenges facing chief pharmacy officers and pharmacy supervisors, he says. Health systems will see a 7.61 percent price increase for pharmaceutical purchases in 2018, according to estimates from Vizient's July 2017 Drug Price Forecast.
Matt Parker, PharmD
“We know that right now healthcare is in a point of turmoil and change, and the pressures from a regulatory standpoint, from a decreased reimbursement, and then the escalating cost of pharmacy items, all that mixed together, was something that we just had to get our hands around,” Parker says. “Hospitals were the land of milk and honey for quite some time, and they didn’t have to look everywhere for cost savings, but, we are at a point in healthcare today, where, literally, we have to turn over every rock, to see if there is savings there. I think pharmacy has been one of the hidden gems, as there is a lot of cost in pharmacy, and there is a large potential for savings.”
To get this initiative underway, Parker and other clinical leaders put together a strategic business plan. “We started with, first, we needed to know how much we’re spending on pharmaceuticals as an entire system. We need to know where that spend is going within our organization. We need to know if that is the right contracted price, or not. We need to know if the quantity in any given location is correct, or not. And, by managing all of those pieces together, we’re able to produce a ROI. We’ve produced a business case, we went to senior level leadership and said, ‘Here’s the problem, pharmacy inventory is costing hundreds of millions of dollars to the health system on an annual basis.’ And we feel like we can take percentage points away from that by better managing our inventory; doing things that for-profit corporations have been doing for years, looking at streamlining the supply chain.’”
Parker adds, “We want to apply those concepts to hospital pharmacy integrated delivery network-type work. And, so that’s really the case that we made. That we can do things better, more efficiently, we can increase our inventory turns, and by doing so, we can bring savings, or least working capital, back into the organization.”
The health system worked with Mountain View, California-based Omnicell, a provider of medication automation, analytics and medication adherence solutions, to implement the pharmacy performance center to leverage enterprise software solutions to centralize pharmacy services, standardize workflows and processes across the health system and leverage medication use analytics for cost/benefit evaluation of different medication regimes. The supply chain and distribution side of operations are provided out of an 8,000-square-foot facility, while at the same time, the technology platform is providing business operations and insights.
“It’s a wide net that’s capturing a lot of operational data, it’s putting it into one place, and then the data scientists are going in and creating rules and queries that are writing language, it comes back to us, it takes our data, and moves it from being data and turns it into information, and then take that information a step further, and turn it into knowledge,” Parker says. “We’re able to take data elements from across our system, merge them together, and then are able to tell a story that we haven’t been able to tell before, by having this software available for us.”
Previously, the health system managed individual pharmacy locations that were at each acute care hospital as well as retail pharmacies. “Each one of those were purchasing pharmaceuticals on their own. So, we put the gatekeeper approach into our process, and the pharmacy consolidated service center is now that entry into the pharmacy supply chain. That is helping us drive down redundancy and waste in our system,” Parker says.
He continues, “The supply chain piece for us is the largest piece. Pharmacy, by nature, is a supply chain operation, and we are also a clinical department and we have clinical functions, but we have to have the drug in order to service the patients’ needs. Many times, I think the supply chain aspect of what we do has been neglected through the years of pharmacy practice, and we find that we have got to come back to that, we need to refine that, as there is opportunity for savings and efficiency in that process.”
Essentially, use of the technology platform allows the hospital to pinpoint exactly where medications are located across facilities to better navigate drug shortages from both an operational and clinical standpoint. It also allows pharmacy leaders to better track utilization and reduce costs as medications aren't expiring while just sitting on the shelves. What’s more, the health system is able to improve its processes by using technology and data.
“By using this tool and these analytics, we’re able to really drive down into our inventory management functions and able to identify what is the right quantity to have, at any given location,” Parker says, adding, “And, by doing so, we’re improving patient care; we’re having less doctors out, we’re having the product there available when the clinician needs it. That work was being done at each individual location. Our pharmacists and technicians that work in those areas, that’s not their primary responsibility; their primary responsibility is to take care of the patients. With this tool, we’re able to centralize that function and take that work away from them so they can focus on being at the bedside for the patient.”
In addition to improving efficiency and patient care, Parker says an unintended consequence of leveraging this technology is the ability to take cost out of the system. “Ultimately, we’re taking money out of healthcare costs in general. So, our organization is very focused on becoming a more efficient provider of care, and a cost leader in our market, so anything we can do to remove cost from our system will ultimately benefit the patients as well.”
Through the use of data analytics, pharmacy leaders have visibility across the system with regard to clinical utilization. “We could do that before we had this tool, but it took a lot of time; we had to run five, six, seven reports in different systems,” Parker notes.
The biggest challenges pharmacy and clinical leaders encountered while implementing this technology platform was more of a cultural issue, rather than technical. “We’re making adjustments to inventory quantity, we’re making adjustments to where inventory is sitting and can be stored, and a lot of times, the individual pharmacist or pharmacy technician at each location, they are used to what they have always done. It’s been a learning curve to get them comfortable; you’ve got to trust the data, you got to trust the analytics that we have. And we’re able to present the data, and say ‘This is what’s happening on a regular basis.’ On a ground level, they just don’t see it, because there’s so many other priorities going on inside a pharmacy for you to pay attention to,” Parker says.
Parker says there were many lessons learned as the system rolled out the technology platform. “We’ve learned that in a complicated health care system, it’s important to make sure all your data points are talking together. So, what we’ve put in place, if a drug comes in the door, in this facility, we make sure it exists in our electronic medical record (EMR) and that the bar code scans are there, and built throughout all our systems, and that it’s talking to each other,” he says.
What’s more, the development of a strategic business plan as critical for any health system looking to implement a consolidated pharmacy service center approach to managing resources across the enterprise. “That’s where we spent a lot of time, developing the plan and thinking about services we were going to offer, thinking about the IT partnerships we would need to accomplish our goals, and then being able to really go to our C-suite and make a case for where we should tie up organizational funds to do this. That’s probably the most important piece of what we’ve done; making sure that we’re able to follow up on the commitment we made to our corporate officers,” he says.