A Prescription for Success

Keeping up in the pharmacy is a tall order to fill

At the end of the day, pharmacy executives must ensure their IDN is using the safest, most effective drugs. Easier said than done. Typically one of the busiest hubs of the hospital, the pharmacy must navigate drug costs, drug availability, product shortages and more, while keeping a close eye on clinical needs and patient safety concerns. Seasoned pharmacy directors and vice presidents know this often is too much for one person to handle. Smart ones know where to find help.

Facing the issues
As if patient safety concerns are not enough to manage, contracting for the pharmacy has become so complex, it can be mind-boggling, says Nick Caseinova, director of pharmacy services at Benefis Health System (Great Falls, Mont.). Pharmacy contracts are laden with market share clauses and bundling agreements, forcing pharmacy executives to have to read them more closely than ever before, he says. “Today, hospital pharmacies almost need a full-time person to ensure that rebates and bundle agreements are accurate,” he says.

Chances are, that won’t happen, he continues. “Given the current economy, we all are being asked to do more with less,” says Caseinova. That said, he foresees greater interaction between IDNs and their GPOs in the future. For instance, VHA provides Benefis with shared service resources, including cost-savings initiatives, feedback on rebates and cost-sharing ideas. “I think we will see more of these types of services in the future,” he notes. This will help ensure that the many details of pharmacy are covered, he adds.

Mark Donaldson, B.Sc., R.Ph., Pharm.D., FASHIP, director of pharmacy, Kalispell Regional Medical Center (Kalispell, Mont.), agrees. “Patient safety is our number one culture here,” he says. “From a pharmacy standpoint, how can we add to that by ensuring that the drugs we select are safe?

“Twenty years ago, we had to contract with every individual supplier, which was time-consuming and silly,” Donaldson continues. “Today, we partner with VHA and Novation. So, instead of me having to do all of the contracting, they do a lot of that now.” With 350+ hospital members in the mountain states, the “power of one” approach is much more efficient, he points out. And, standardizing to one wholesaler on Novation’s contract has further reduced costs for the IDN.

In Gary Freeman’s experience, product shortages are one of the biggest issues facing directors and vice presidents of pharmacy. The Amerinet vice president of pharmacy notes that this year, for example, healthcare providers are experiencing a shortage of seasonal flu vaccine. “The government mandated swine flu vaccine production early on,” he says. Today, providers that placed orders for seasonal flu vaccine last spring are having trouble getting them filled, he notes. So, suppliers cut back from 140 million doses of seasonal flu vaccine to 120 million doses. Due to sundry issues, this in turn has been further reduced to 90 million, says Freeman.

For pharmacy executives, less product means more work. “We encourage our members to work with us, as we try to contract with alternative suppliers when possible,” says Freeman. In addition, he advises pharmacy directors to stay in close contact with their wholesalers to ensure they get their share of product. And, by working closely with other hospitals in their IDN, they can often generate some good strategies, he adds.

Safety first
From the perspective of Joel Hennenfent, Pharm. D., M.B.A., BCPS director, pharmacy, services operations department Broadlane, two overriding issues in hospital pharmacies are patient safety/product efficacy and cost reduction. “Medications must be available in a safe and usable form for patients and healthcare professionals,” he says. As such, he expects drugs to be available as unit dose products, clearly labeled and bar-coded with expirations dates. “Unique labels [are necessary] to decrease look-alike/sound-alike product labeling errors,” he says. In addition, packaging should be small enough to accommodate space limitations and components on injectable products should be latex- and PVC-free, he adds.

Indeed, selecting the right products is key in reducing medication errors, he points out. In addition, Hennenfent suggests the following:

  • Develop sound multidisciplinary processes with continuous quality improvement processes.
  • Organize and label pharmacy and administration areas logically and in accordance with JCAHO standards and best practices.
  • Simplify and automate as many processes as possible to eliminate steps and human error.
  • Create a culture of medication safety in the department, hospital supply chain, IDN and GPO, as well as with wholesalers, manufacturers and professional organizations.
  • Ensure that medication error reporting is simple and non-punitive for the individual making the report.

But, patient safety and medication error reduction is only half the battle, says Hennenfent. Pharmacy directors are constrained by rising drug costs, reimbursement cuts and an increased number of uninsured or underinsured patients needing to be served, notes Freeman. “Health systems and hospitals develop best practices consistent with the literature that maximizes contract compliance to obtain the best pricing,” he says. This includes “identifying areas of opportunity, having political support to pass committee structures, having the necessary manpower to educate others on and implement best practices, monitoring progress, and making adjustments as problems arise and as new data becomes available.”

Mick Hunt, vice president of pharmacy, Novation, agrees that patient safety and controlling costs are two of the biggest issues facing pharmacy directors today. Add to that the fact that “in the last eight or nine years, drug shortages have become a problem,” he says. “If a drug is not available, the [pharmacy director] must take extraordinary measures, such as switching to a new supplier or working with the medical staff to find a different drug.” At the same time, pharmacy executives must oversee drug utilization to ensure the right medications are being properly dosed and dispensed, he adds. By standardizing on one or two medications in each drug category, pharmacy directors can leverage greater market share and lower prices, while reducing the risk for medication errors, he points out.

Indeed, a shelf full of look-alike/sound-alike drugs present one of the greatest risks for error, notes Hunt. Pre-filled glass syringes labeled by hand are difficult to read, he cautions. Look-alike drugs should be stored far apart to help prevent confusions while clinicians and staff should be thoroughly educated about, and alerted to, similar-sounding drugs.

Today, some distributors are doing their part to reduce medical errors and ensure patient safety. “Sometimes the smallest thing can interfere with getting the right medication to the right patient,” says Suzanne Shea, vice president of pharmacy operations management, Cardinal Health (Dublin, Ohio). Pharmacy directors play an important role in medication error reduction, she points out. As such, “they should be involved from the time the drug is prescribed to the time it is ordered, delivered and administered. Communication is key. Cardinal has over 100 clinical pharmacists whose job it is to work directly with [hospital] physicians.”

Distributors can help by ensuring the right products are correctly packaged and delivered, explains Shea. “Are the right generics coming through the door?” Automated solutions, such as barcode-ready packaging for bedside scanning, can be extremely helpful, as are automated dispensing cabinets, she adds. Not only are such solutions safer, they save staff time as well.

Getting buy-in
Even in the best economy, it’s nearly impossible for hospital pharmacies to carry every drug. “Pharmacy directors need a good formulary that [reflects] best practices and is cost effective,” says Caseinova. “The biggest issue is developing a real consensus and significant clinician buy-in regarding which items should be included – and then ensuring that physicians stick to it.” Involving key decision makers and engaging medical staff helps facilitate consensus, he points out.

“Communicate, communicate, communicate,” he continues. “Pharmacy directors must communicate their reasons [for choosing certain drugs] with medical staff and personnel.” In addition, they need a solid process to address those rare circumstances when non-formulary drugs are indicated.

The formulary process has evolved over the years, notes Freeman. “It’s much better managed today,” he says. Indeed, as the focus has shifted from cost to drug safety and efficacy, pharmacy executives have become more adept at effectively communicating with physicians on pharmacy and therapeutics committees. “At the end of the day, cost should be the last thing pharmacy directors should discuss with physicians,” he points out.

It helps that pharmacists today are more involved in clinical processes, notes Donaldson. “Pharmacists no longer sit in the background,” he says. “The old model where the physician did everything has morphed into a teamwork model. Now, pharmacists [accompany] physicians on their rounds. When the physician makes a diagnosis, [he or she] confers with the pharmacist.”

That said, no one wants to force formulary, adds Shea. “Pharmacy directors should get physician buy-in [by providing doctors with] clinical tool kits with bundled information and clinical research,” she says. And, pharmacists and physicians must constantly look at drug safety, efficacy and cost, and make decisions that balance all three, she notes.

Working with colleagues
It’s all about communication, says Freeman. Pharmacy executives should never work in a vacuum, particularly with regard to medical error reduction. “It’s extremely important for pharmacy directors to work with other professionals and interdisciplinary teams at their hospital,” he points out. “How are medications being used, from shipping and storing to the distribution [and dispensing] of the product? There are a lot of people doing good out there, and [pharmacy directors] can learn from those best practices.”

“There absolutely is a real opportunity for pharmacy directors and materials management directors to work together,” says Shea. After all, they play similar roles when it comes to getting products to nurses, staff and patients, she points out. “They need to work together to say, ‘What do you, doctor, need to be most effective?’”

“Too often, in the past, pharmacy directors viewed materials management as trying to encroach on them,” adds Freeman. “Today we know that’s certainly not the case. Often, pharmacy initiatives [extend to] equipment or other [products]. It can be a good opportunity when two hospital departments work together.”

Network of support
One of the biggest challenges for pharmacy executives today is finding the time to stay current on regulatory guidelines and new drugs, notes Shea. Through benchmarking tools, the distributor can identify top medication cost drivers and trends, and share this information with its IDN customers. “We package information and literature for pharmacy directors so that they don’t have to peruse the various Web sites,” she says.

Sometimes, however, it pays for pharmacy directors to take time to review Internet sites, says Hennenfent. Professional organizations, such as The Joint Commission, ISMP Medication Safety Alert®, National Patient Safety Goals and the Food and Drug Administration, offer a wealth of information on their Web sites, he points out. “Another excellent way [for pharmacy directors to stay up-to-date] is to join listserv groups in areas that are changing rapidly (e.g., patient safety and computerized physician order entry).”

Staying current on drug guidelines and standards involves a lot of commitment on the part of pharmacy executives, adds Hunt. That said, “the hospital pharmacy is very collegial by nature,” he says. “The pharmacy is a tight network, and there often is a lot of sharing from one hospital to the next.”

The future of pharmacy
Pharmacy contracting has evolved from local bargaining to national strategizing over the years. But, don’t be surprised to see pharmacy executives bring the contracting process back to their own backyard, note some experts. “We’ve seen contracting grow from a local to a regional to a national [venue],” says Freeman. “I think we will begin to see some movement back to regional or local contracting, and GPOs will have to accommodate that.” In particular, decision makers are realizing it’s easier to drive compliance on a local level rather than a national one, he adds. Certainly from an IDN perspective, they should have a solid ability to obtain buy-in and contract for products cohesively, he explains.

But, no matter what level contracting takes place, the pharmacy director will never be in a position to do it all and, as such, will continue to rely on outside support groups, such as GPOs and distributors. As pharmacy departments continue to tighten their budgets and reduce staff, “I think they’ll look more to their GPOs and take advantage of available GPO programs,” says Hunt. “This will [ensure] less work for smaller pharmacy staffs.” And, as more hospitals come together through national GPOs or regional purchasing coalitions, “we should see a greater focus on commitment to contracts,” he adds.

Indeed, the pharmacy reach has expanded from the loading dock to the patient bedside, says Shea. “As the pharmacy’s role continues to grow, pharmacy directors will have to rely more on outside resources, and regardless of the issue, it will be our responsibility to keep our customers up-to-date.”

However, pharmacy contracting will continue to revolve around obtaining safe and effective medication at the lowest cost, says Hennenfent. “An increased emphasis will be placed on patient safety features, such as product labeling and packaging,” he says. “In addition, it will become more important to obtain medication pedigree history and confirmation of appropriate product storage throughout the supply chain.

“One challenge for directors of pharmacy will be [to determine] who actually will provide the patient safety mechanisms,” he continues. “Will it be the manufacturer, a pre-packing company or individual organizations? Will manufacturers be willing to step up and buy into the patient safety culture, and will they be compensated for the added expense? Will directors of pharmacy re-label and re-package all products at the individual pharmacy level, and can they afford the technology [necessary to do so]?”

Regardless, pharmacy executives will have to be innovative, says Hennenfent. “They will have to be willing to try new things outside of their comfort zone and be able to understand the ever-changing complexities [in order] to continue their focus on providing safe, high quality care at the lowest cost.”

About Laura Thill

Laura Thill is a contributing editor for The Journal of Healthcare Contracting.

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