Health consumers migrating to retail
Futurist/economist Jane Sarason-Kahn
Healthcare goods and services will account for nearly 1-in-4 dollars spent in the United States within the next three years. That massive growth in spending will pose huge challenges for patients and health plan payers, said health economist Jane Sarasohn-Kahn. But it will thrust retail pharmacy even further into the front lines of care as the nation’s stressed health system desperately seeks ways to curb unsustainable costs, expand patient access and improve health outcomes.
Addressing the Health Innovation Summit, co-hosted in June by CVS Health in partnership with DSN and Mack Elevation, Sarasohn-Kahn highlighted the economic stresses Americans face as they grapple with rising out-of-pocket costs. “Increasingly, the patient is the payer,” she said. “The mass of Americans … haven’t had a wage increase in years, but [their] health costs are jumping. This is really part of our culture now.”
Americans’ alarm over the costs of health care is well documented. A recent Gallup poll found that “the cost of health care is Americans’ top financial concern,” and “leads the list of what Americans consider the most important financial problem facing their family,” Gallup reported.
Behind those concerns is the very real expansion of health costs in the United States. Between 1980 and 2015, healthcare costs as a share of the gross domestic product doubled, from 9% of the GDP to 18%, according to Gallup.
For that and other reasons, Sarasohn-Kahn said, “We must understand what our patients want. Say we prescribe something for patients that [costs] $90,000 a year. If that patient doesn’t have enough food to eat, the drug really isn’t going to work very well.”
But unsustainable out-of-pocket costs are only one of the stresses Americans are facing as they grapple with an opaque and disjointed health ecosystem, said Sarasohn-Kahn, who authors the Health Populi blog. Costs and quality of care can be wildly dissimilar and out of sync from one region to the next, and even from one community to the next, she said, depending on which health provider or hospital system serves that community, and which insurance plans are available.
“What really matters to your health is where you’re born,” she said. “You can have very different health outcomes two miles away from your own community, and state by state, your well-being is different.”
Both health plans and many local and regional health systems have failed to provide a clear picture of care and cost options, or to rein in rising out-of-pocket costs, Sarasohn-Kahn said. “People feel … pretty confused and dazed when they get sick and have to deal with the labyrinth of health care in this country,” she said.
As a result, she said, “Health plans are really … the lowest-rated industry segment in America. When it comes to the legacy healthcare system, … consumers don’t feel they get any respect.”
Instead, she said Americans increasingly have turned to such retail settings as pharmacies and in-store and stand-alone clinics as places that provide “trust to help [them] manage [their] health. Consumers are looking for transparency — ‘how much is it going to cost me, what’s the quality and is there a report card for this doctor?’ So whom do consumers love in terms of experience? Supermarket chains … and retail pharmacy.”
Given those trends, Sarasohn-Kahn said, “This is a great time in health care to be in this business … because we now have the technologies to help people turbocharge their engagement in their health.”
Supermarket and mass pharmacy operators that provide a broad array of groceries have an additional advantage as health care becomes more self-directed and patient controlled, she added. “Food has become really, really important” to the pursuit for healthier lives, she said. “Food is a gateway drug. People with chronic conditions are really serious about it, and need a lot of help.” That means that combo and superstore retailers that “figure out how to help people build a healthy grocery cart” will have a powerful market advantage. “Food and fitness are colliding. Hy-Vee now has a fitness center in a few stores,” she said.
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Q&A: Doyle Jensen on central fill’s potential for community pharmacists
The demands placed on pharmacists’ time have only increased as the industry works to deliver within a fee-for-service model, and among the companies looking to help pharmacists maximize their time through technology is Innovation, maker of the PharmAssist robot and solutions. Drug Store News caught up with Innovation VP global business development Doyle Jensen to discuss the company’s role in enabling community pharmacists to better serve patients through technology.
Drug Store News: With consumers taking greater control of their own health, how is your company helping community pharmacists use technology to better engage patients, improve the patient experience in pharmacy and/or improve communication with patients?
DOYLE JENSEN: Our central fill/mail order technologies help free up in-store pharmacists and other pharmacy staff from their prescription fulfillment responsibilities by centralizing up to 50% to 60% of the store’s prescription volume at an offsite facility. By removing these prescriptions from the store’s daily grind, pharmacists and technicians have more time to engage patients and deliver the various services patients now expect.
DSN: As pharmacists work to achieve provider status and continue to play a greater role in healthcare delivery, how is your company enabling community pharmacists to practice at the top of their license?
DJ: The question I continually ask our pharmacy partners is, “Are you currently utilizing your pharmacists in an appropriate role for their professional background?”
We typically hear that they are not. Most of their pharmacists are extremely busy performing tasks that would be better dealt with by other staff members. Today, it’s common to only see the pharmacist from afar tethered to a PC and a phone, verifying prescriptions at the same time. If pharmacies truly want to make an impact on patient care and take on a greater role in healthcare delivery, they need to redeploy their pharmacists.
Technology really is the answer. Central fill is the most efficient use and has the best ROI of capital investment. Retail-deployed (in-store) technology can have an impact, but is utilized on average less than 20% of the time. Additionally, newer technologies that can “virtualize” the required pharmacist verifications, can now free pharmacists from the back counter and enable them to be upfront with patients.
DSN: How is your company helping community pharmacies drive greater efficiency in their business whether in terms of inventory management, optimizing workflow, or keeping ahead of reimbursement challenges, etc.?
DJ: The greatest impact we make is on optimizing a pharmacy’s workflow. The production of prescriptions can be done more safely and much more efficiently at a centralized facility using our central fill/mail order technologies. Removing potentially 50%-plus of the day-to-day prescription production provides immediate relief at the store level and frees up staffs to provide patient facing care.